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wholesale pricing (was re: shipping fees)

updated wed 21 oct 98

 

Tom Wirt on sat 17 oct 98

----------------------------Original message----------------------------
Is wholesale considered to be 50% off your retail?
Is the going consignment rate 60/40? Or does this vary from area to area?



We set wholesale price by considering what we think the piece will sell for in a
retail store, and then taking 50% off that. HOWEVER, most stores are marking up
more than 100% (50% margin) and then adding shipping on top of that. Packing,
as I posted before, is in the wholesale price and gets marked up too. We
haven't adjusted our wholesale price for the consideration that markup might be
120%. I specifically noted the price is based on the retail STORE environment.
What a piece will command in a store MAY be different than what it will bring at
a street fair.

I think the retail stores that keep increasing the markup, are putting
themselves in a negative spiral. The higher prices slow sales which require
higher markups to cover costs. (Maybe Wendy could offer some insight here.) We
try to visit the shops carrying our work to see how they're displayed, what the
pricing is and what other work is being carried. Invariably, for our work, the
store that stays closest to the 100-120% markup is selling the most. But our
pricing and business philosophy is stolen from Warren MacKenzie and others. It
wouldn't be right for others.

Is 50 % too much to"give away"? (I'll enter this fray again, with trepidation).
Add up all your costs, add in a factor for lost production time and wear and
tear on yourself and your equipment and 50% is very reasonable. We still do
some retail fairs. It's the only way to stay in touch with consumers and, in
limited quantity, is fun. But it is no more profitable than selling wholesale.
And there's a weather risk factor that doesn't exist in wholesale.

Wendy Rosen contends that many of us price way too low for the market. On the
other hand, many functional potters want to see their work in peoples hands
being used. If you pay $20 for a plate, you may use it everyday. If you pay
$40, you'll think it's for company only, negating the reason for owning. Truly
a dilemma.

So, enough of this. Hope some of it makes sense. It's just the way we approach
they business.

Tom Wirt
Clay Coyote Pottery
17614 240th St.
Hutchinson, MN 55350
320-587-2599
claypot@hutchtel.net

The Slack-DeBrock Family on mon 19 oct 98

Just another point of view on pricing that may be of interest to some: I
recently decided to set some"terms" on pricing my work. I needed to feel
comfortable with the issue, and I felt that I was giving away my work in
many instances. Since I operate a retail shop next to my studio, I decided
on this:

i will mark my work at the retail price I would sell it for in my store.
If a business wants my work on consignment, I will allow a 25% discount off
my retail price. If a business buys work outright, the first through fifth
items are sold at the marked price. No Discount. If they purchase 5 items
or more, I allow 35% off my marked price. the business owner may mark
prices at their own discretion. I feel this is fair because my shop is
located in a rural setting, and i know that the work sells for much more
depending on location. the business owner can be the judge. This
arrangement feels good to me- reasonable and I can still make a living at
this!!

Joan Slack-DeBrock/River Run Pottery
P.O.Box 95
McNaughton, WI 54543
715-277-2773
riverrun@newnorth.net

Kathi LeSueur on tue 20 oct 98


In a message dated 10/19/98 1:12:27 PM, you wrote:

>i will mark my work at the retail price I would sell it for in my store.
>If a business wants my work on consignment, I will allow a 25% discount off
>my retail price. If a business buys work outright, the first through fifth
>items are sold at the marked price. No Discount. If they purchase 5 items
>or more, I allow 35% off my marked price. the business owner may mark
>prices at their own discretion.

If you don't care to do much wholesaling this is probably an okay system. But
if I was the buyer I'd turn it away. One of the things a buyer expects me to
know is what price my work can go for at the retail level. Although this will
vary in some areas, it isn't by much. A retailer MUST double the price they
pay you in order to meet their own expenses of doing business. Most must mark
the price up even more. If you have a $50 item and can maybe get $55 for it,
if you are lucky, how can you expect a shop owner to get at least $65 for it.
I believe it is best to test all items at the price you expect the shop owner
to sell the work at. That price is a minimum of a 50% markup. If you can't
sell it at that price why do you think they can?

I've known people to go to Rosen and raise all of their prices 20% over the
retail prices that they've been selling their work at because "I can't give
away 50%". When they have a bad show they blame it on Wendy Rosen rather than
themselves. The buyers have an idea of what they can get for a piece. They've
been to shows enough to probably know what you or someone doing similar work
is selling it for. When that price is out of line they will pass you by and
spend their money at the next booth.

Kathi LeSueur
Ann Arbor, MI

Tom Wirt on tue 20 oct 98

>----------------------------Original message----------------------------
>Just another point of view on pricing that may be of interest to some: I
>recently decided to set some"terms" on pricing my work. I needed to feel
>comfortable with the issue, and I felt that I was giving away my work in
>many instances. Since I operate a retail shop next to my studio, I >
>i will mark my work at the retail price I would sell it for in my store.
>If a business wants my work on consignment, I will allow a 25% discount off
>my retail price. If a business buys work outright, the first through fifth
>items are sold at the marked price. No Discount. If they purchase 5 items
>or more, I allow 35% off my marked price. the business owner may mark
>prices at their own discretion. I feel this is fair because my shop is
>loca


Truth is, any of us can price our work any way we want. If someone wants to buy
it or not buy it, wholesale or retail, that's their prerogative.

I believe Joe Bennion once stated (are you still out there Joe?) that he sells
everything at his shop for one price. No discount to anyone. If a retailer
buys it for a shop,(s)he can mark it anywhere he wants. Joe's happy, they're
happy.

The whole 50% off thing for wholesale is a joke, since the markup is usually
more than 100%. (One shop in NY marked our stuff up 400%...course they didn't
sell any of it either.) Shop owners will look at your work and prices, figure
what they need to make a living and keep the store open, and mark it up
accordingly. If they think it will still sell at that price, they buy....if
not, they don't.

Jonathan, your post has sent me back to the calculator. Will get back on line
with this shortly. I might also put in a note that a couple of years back,
someone wrote and posted a series of papers on doing business. Sorry I've
forgotten your name. Probably in the archives.

Tom Wirt
Clay Coyote Pottery
17614 240th St.
Hutchinson, MN 55350
320-587-2599
claypot@hutchtel.net