This weekend I spent some time finalizing the Sunlit Letterpress Spring-Summer 2008 Catalog. I found setting wholesale pricing difficult. There is always the tradeoff between making a profit and adding more retailers to your list of retailers. From my research, I've established that with mass-produced items, the wholesale price offered to retailers should be about 50% of the MSRP. But when you are an artist or crafter creating limited amounts of product, this 50% might only cover your costs. Selling your products at cost won't get you very far.
So what is the balance? Is there even a formula that works for everyone? Definitely not. I guess it's a bit of trial and error.
Then there is the other issue of minimum order quantities and dollar amounts. Discounts for repeat orders and payment up front. Oh, and should you even list an MSRP? Shipping costs and return policies...the list goes on and on.
I think I've come up with terms and pricing that will work for me - but the sad thing is, that I won't know if this will work for retailers until they see the catalog for themselves.
If you are an artist or crafter that has struggled with these issues - I invite you to comment below. What works for you? What feedback have you received from retailers that carry your products? Do you have tips for the rest of us?
Happy letterpressing!
I am right there with you! Those are all questions that weigh on my mind. PLUS, in my tax bracket I would have to take out 50% of the tiny miniscule profit for taxes, social security, and medicare. Makes the whole thing pointless for me unless I did it full time and all the time. Discouraging!
ReplyDeleteMeg Ilasco's book "Craft, Inc." has a nice section on pricing which explains how and why one should be marking up prices from "cost" for wholesaling.
ReplyDeleteWhat I found most helpful was to do research, research, research on what other companies were charging and their terms and order policies. Having a sense of the range of retail pricing helps so you don't overvalue or undervalue your work.
If you have the time or availability, visit the Stationery Show in New York in a few weeks where you can meet with current business who have already done what you're doing. No need to re-invent the wheel, right?
Best of luck!
Thanks Megan and Albertine - great to hear from you both!
ReplyDeleteCraft Inc. is definitely a great book, I refer to it often. It took me a while to decide on all my wholesale policies and pricing schedules, but I think I got it figured out. Hopefully retailers will like what I've come up with :)
Best to you both!
I agree with Megan. When you figure in taxes, etc. it can be discouraging. Also, the fees from paypal, and the mastercard people. Every little bit eats away any profits. Good thing most of us enjoy our time on press. :)
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