I often get questions about selling wholesale so I thought I would answer a few of the most frequently asked questions in a blog post. It's definitely not comprehensive, but hopefully it can help anyone looking to start out selling their products wholesale.
1. Do you sell wholesale?
Why yes, I do! For most of my products anyway. I provide wholesale buying options for my products that are at a low enough cost to still gain a decent profit when selling wholesale.
Find the list of stores that carry my products on this page: https://chanamon.com/pages/stockists
2. What does it mean to wholesale your goods?
When you sell wholesale, you are selling your goods in bulk to a retailer at a reduced cost (think Costco!). They then go on to sell the product at full retail value without needing your involvement, while you’re at home counting your cash from the large order.
3. Why do businesses sell wholesale?
For me personally, I sell wholesale for the following reasons:
- I am able to sell a higher quantity of goods in one sale.
- My products will be exposed to a wider audience without me doing the legwork to reach each individual consumer. This is especially true for sales to other states or countries that I don’t have access to otherwise.
- I like the idea of having regular purchases from wholesale accounts, creating a more consistent stream of income that I can rely on having throughout the year.
But I can also see a number of reasons why a business would not want to sell wholesale:
- Some products, such as hand carved wood, are incredibly labor intensive. Selling them at half price to retailers may not be worth it for the amount of work put in by the maker.
- Other products may take a very long time to create. It might be too much pressure for a maker to create large batches at a time to sell. I know I had this feeling when I sold my ceramics wholesale.
- The cost of goods is high, so either you wouldn’t make very much selling it wholesale, or retailers/customers wouldn’t buy your product at the price point where you make a profit. This is why I don’t sell my apparel wholesale.
4. Did you say wholesale is half price?
Yes. Typically, wholesale prices are 50% of retail prices. This means if you buy a shirt at a store for $40, the store likely bought it for $20 from the original brand. Consider your pricing carefully when thinking about wholesale. You’ll still want to make a profit off of selling to a retailer, so make your retail prices at least 4 times the cost.
For example, my stickers cost about $0.75 to produce. I sell them at $4 direct to consumer because that is the market rate for stickers right now, and because I would still make a profit selling them at $2 to a retailer.
My apparel on the other hand, I do not sell wholesale. Each garment costs about $15 to produce. I want my shirts to be affordably priced, so I decided to make them priced at $35-40. If I were to wholesale them, I would only be making $2.50-$5.00 per shirt, and that’s before taking into account the time and effort I put in, shipping costs, etc.
Fortunately, the cost of shirts goes down the more you order, which is why I was able to sell my shirts wholesale once to Attic Salt when they told me upfront they would be buying 1400 units. That brought down the cost to around $9 per shirt and Attic Salt bought them for $13. $4 a unit still isn’t a great profit, but I considered it an investment in publicity to have my shirts available in this national retail chain.
Selling your products at half price isn’t for everyone though. You’ll have to weigh for yourself if the pros outweigh the cons.
5. How do you have your wholesale catalog set up?
I started off with a PDF catalog of all the items available for wholesale, with photos and descriptions of each item, the wholesale price, suggested retail price, and minimum order quantity listed. I eventually got very tired of updating this long document, so I was very happy when platforms like Faire and Bulletin came around.
I love selling on Faire because it’s an easy way to manage my wholesale catalog as well as get discovered by new retailers organically. Think of it like an Etsy but for retail shop owners. They can go to this platform to search what they’re looking for and find brands that create these goods. For any retailer that finds you on the platform, Faire takes a 25% commission for new orders from your shop and 15% commission for repeat orders. For wholesale accounts I contact myself, I’m able to give them my Faire Direct link where the commission rate is 0%. This means I’m able to have the structure and convenience of Faire while gaining 100% of the sale from accounts I found on my own.
Bulletin is very similar but with a lower commission rate of 15% for new orders and 10% for repeating orders. I honestly just set it up because they emailed me about it, but I don’t have much experience or orders so far from it to really give my opinion.
I would definitely recommend opening a store on Faire though! It’s a neat way to get discovered by shops across the country and world that you might not have otherwise found yourself.
If you’d like to open a shop on Faire and I’ve helped convince you, please consider signing up through my referral link. You have to be reviewed and approved to become a storefront on Faire, so my referral may help give you a leg up in getting accepted. I will get a referral bonus for anyone that signs up through my link, which will allow me to continue making art and free content like this blog!
6. How do you find retailers to buy wholesale from you?
For as long as I can remember, I’ve had a note on my phone with a running list of shops in which I’d like to have my goods carried. Many of these were stores that I was a customer of myself and liked shopping at. Eventually, I got to the point where I had the courage to actually approach these stores to sell my goods.
I usually come across a new store for the list when browsing on Instagram or when out on a stroll in a new place. I’ll stop by any store that looks like they sell cute knick knacks or locally made goods to see if my work will be a good fit. If I’d like to have my stuff there, I usually walk right up to the counter to speak with an employee about it. I always have my business card on hand to leave with them and try to get an email address to follow up with later.
Now, I also take the time to research new retail opportunities online. Many business have a “stockists” page where they list all the retail stores they are stocked at. For brands similar to mine, I often research through their stockists page, taking note of which ones to reach out to myself.
I’ll be talking about how I approach potential new wholesale accounts in a future blog post.
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