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Saturday, February 16, 2008

Wholesale and The Small Indie Business, Is It Worth It??

Recently, I've gotten a slew of requests, to do wholesale locally, and overseas. I absolutely love receiving them, and occasionally it works out. Most of the time however, it is larger businesses, just fishing Etsy for a deal on our handwork. Here are some of the problems I can see, when going into a larger wholesale deal.

1. Unless you plan on making 5,000 zipper pouches yourself in the space of a week, you probably won't be able to handle large requests.

2. Buying materials in bulk, so that you actually make money on the wholesale purchase, is a lot of money up front. And you will probably end up with a ton of excess, therefore, lose money.

3. Usually, wholesale would be 50% off your regular price. Unfortunately on Etsy, we all are so competitive for business, we are mostly underselling to begin with. Therefore, who can afford to take 50% off, on a small wholesale order?

4. As I said in number 1, due to the fact that we are small, usually individual, businesses, we cannot handle the volume of a retail store. Unless someone buys a large quantity of our product to begin with, other than getting our name out, wholesale will probably leave us in the red.

Some positive thoughts on wholesale, you can definitely get some great advertising and word of mouth from doing larger orders. Most B&M stores are very professional and accommodating to artists. They found us because they value handcrafted goods, and understand our pricing struggles. Also, they generally give a lot of leeway in production times and quantities.

In conclusion, take a chance with wholesale selling, but be careful not to lose more money than you make!
T♥

5 comments:

Steph said...

so far I've had pretty good experiences with small wholesale orders. : ) I keep my etsy prices at the retail price so there's no disparity between the B&M shop prices and mine. I haven't quit my side jobs or anything but I definately make more off wholesale than etsy sales. I totally agree that it can be tough to crank out the large wholesale orders sometimes, I'm in the middle of one now yipes!

Orion Designs said...

Tara,
I'm very selective about which items I am willing to wholesale. I make sure to price everything at full retail on etsy and at shows so that all customers will see similar pricing no matter where they purchase.
Wholesaling on a super-large scale is definitely something I'm NOT interested in doing. Currently I maintain 3-4 wholesale accounts and about 12 consignment accounts. That's about as much as I can commit to! Good luck!
Vicki

VioletsVintage said...

I found this article very helpful as I just received a wholesale request and am worried about depleting my items I have i stock. The article answered some of my questions, thank you!

Susantha Herath said...

I am in Blue Topaz business, wholesale is very profitable when you buy direct from the source.

This is my blog about gems and jewelry http://srilankajewellers.blogspot.com

DivineAprons said...

I found this really helpful! I just got my first request to sell wholesale and am so excited. But at the same time really nervous- I don't think I can cut my prices much more and make it worth making...It takes so long to create one of my apron sets..Plus the fabric I use is so expensive!!I'm going to give her a number and hope she will take it! Wish me luck..
http://divineaprons.etsy.com