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Is wholesale right for your handmade business?
Are you wondering how to take your handmade biz to the next level? Are you asking yourself, is wholesale right for me? If you have these questions, this blog post is most definitely for you.
Well. I have a few wholesale orders under my belt and I wanted to shed some light on some of the things I have learned. Wholesale isn’t easy, but it can definitely take you to a whole new level of reaching customers, product visibility and really putting yourself and business out there. In this blog post I am going to suggest a few questions that you can ask yourself to really dig deep into the idea of wholesaling your products. Ultimately, finding out if it is right for you!
Is wholesale right for you?
Wholesale is right for you if you are wanting to take your business to the next level and you’re okay with selling your products at 40% – 50% below your retail price to boutiques who match your brand. Wholesale is a different ballgame in the fact that you are selling your products for less than retail value to boutiques and Brick and Mortar (B&M) locations. Most retailers will mark your product up by 2.2 – 2.5x of your wholesale price – so make sure you have a great pricing structure in place.
Are you confident that you can keep up with demand?
Are you confident in your work ethic? I admit, I was a bit overwhelmed when I first started selling my products wholesale to small boutiques. I was surprised with the amount of orders coming in as soon as I started offering wholesale availability. That’s a good problem to have, right? Well, I jumped in head first and decided to test my might and give it my all. It has definitely paid off. If you feel that you are confident and can keep up, I say go for it.
Are your books and numbers in place?
Book keeping is SO important. Knowing your numbers is top priority in running a profitable business. If you don’t know your cost of goods (COG) then how do you know you are making a profit on your items, large enough to sell them for 50% their retail price. Ask yourself – can you make a profit with your current pricing structure? Like I said previously, most buyers want a 40-50% below retail value price, and then they make up roughly 2.2-2.5x of their purchase price. Make sure you have a great pricing structure in place so that both you and your buyer can succeed. Thus, resulting in a great wholesale relationship and a return buyer!
See this post on why I love quickbooks self employed.
Here’s a few questions to ask yourself:
- Is your packaging professional and cohesive?
- Can you cover upfront costs for supplies?
- Do you have ample storage to buy in bulk to increase your profits?
If you answered yes to these questions and believe you have the go-getter attitude to succeed, I say “GO FOR IT!” and knock those potential buyers socks off. If you have any specific questions, feel free to comment below and I’ll definitely try to reply to all of them.