An In-Depth Look at Wholesale

There is an informative Storque article about the basics of selling wholesale. The article covers pricing, terms and packaging considerations. I wanted to get a little more in depth on the topic with a couple of knowledgeable and experienced artisans.

wristlet by janinekingdesigns
Janine King is an established independent designer of fine quality, fun and unique fabric handbags. Working from their expanded carriage house studio in upstate New York, Janine and her husband Donald run JanineKingDesigns, a premier Made in the USA cottage company. With over 6,000 sales on Etsy.com, Janine brings a mature perspective to the topic of selling wholesale. I feel privileged that she is willing to share her wisdom with us.

pendant by 215Design

Trudy of 215Design, is a 7th grade English teacher at a private school in Kansas City, MO. Making pretty pendants and packaging them beautifully gives her a creative outlet outside of her regular work. I love the enthusiasm Trudy brings to this article.

this photo byOrganicStills Trade shows and reps are the traditional (maybe old fashioned now) wholesale venues. Janine spent time pursuing these routes before settling on Etsy as her location of choice to market her lines. Janine says, "Our items fit into the ‘Gift Market’, which is inundated, with inexpensive China imports. We can’t compete with the pricing. And we can’t mass-produce at the required levels."

My own experience with the ABC show in Las Vegas is that attendance at trade shows has dwindled over the past several years, and both boutiques and small manufacturers are seeking less expensive alternatives to sourcing and marketing their goods. In response to this trend, juvenile marketing expert, James Girone, runs a virtual trade show on his site, a must-see for anyone with infant-juvenile lines. Additionally, rep commissions are usually 15%- 20% of the wholesale price. Unless you can produce your items very quickly and cheaply, your profits will be slim or non-existent. Both Janine and I found it difficult to make a profit selling wholesale through reps.

How Wholesale Happens Janine has had several shop owners tell her they found her by stopping women on the street and asking them where they got their bag. This echoes what I have learned from shop owners over the years. They know what they want when they see it.

(Get stopped on the street by carrying this bag by ArmandoJavierDesign)

If the wholesale buyers are not seeking you out, Trudy suggests sending an email to boutiques, referring them to your shop or website. This has resulted in several accounts for 215Design. Another source of wholesale accounts for Trudy and other popular Etsy sellers has been Trunkt.org (a website where brick and mortar owners can shop for wholesale items to sell retail.)

Having a shop on Etsy does make you visible to boutiques looking for unique items to feature. Trudy says, "I have 5 new wholesale accounts from people who have found me through my Etsy shop." Janine has used her Etsy shop to streamline the wholesale process, by clearly stating her offerings and requirements in her wholesale listings.

Put the horse before the cart. (toy by twelfthdimension)

I asked Janine, "Do you find that selling wholesale helped you get more efficient in your production methods and therefore, more profitable in your retail business?" Her response reveals her business savvy: "The other way around, actually. We became efficient enough in our production methods for retail that we realized that it was possible for us to sell wholesale, but on a limited basis only. "

Trudy offers some inspiration for getting more organized: "I have had to become very efficient in my production because large orders tend to overlap each other. Keeping my supplies fully stocked and my studio tidy helps my production speed. I have also figured out a nightly schedule to produce my necklaces (my necklaces take 3 days to produce due to drying time). I have a batch of necklaces going all of the time. I have to be efficient because I am a 7th grade English teacher by day. I have become more profitable in my Etsy retail shop because people have seen my items in boutiques and visit my website. Also, my husband helps me with the packing and shipping." Organize t-shirt by hungryknife

Don’t get discouraged. Janine (remember now, she is the top seller of bags on Etsy) gets many wholesale inquiries that do not result in new accounts. She comments, "In recent years gift shop owners have become accustomed to buying inexpensive China imports that they can markup 400% and more. When they realize that they can’t purchase one of our $60 bags for $10-$12 they often lose interest. We seem to sell best to very exclusive shops, usually in upscale tourist destinations."

Here is Janine King’s advice to Etsians wanting to break into selling wholesale. "Unless your ultimate goal is to be a large manufacturer or a well known brand thus leaving Etsy altogether, I recommend that you put your energies into expanding your online retail business and use wholesale only to supplement your retail sales. If you aren’t selling enough retail on one site, then expand to other sites. This is called multi-channeling and many professional artisans do this, and if you really want to sell wholesale:
RULE #1: Make it easy on yourself. Be selective in what you offer and offer only your best selling items and/or items that are easy for you to produce. Make sure they are items that you can continue to produce for awhile. If an item sells well for a shop owner, they usually want to re-order and will be disappointed if the item is no longer available.
RULE #2: Make it easy for the shop owner to buy from you. Shop owners are busy people and more likely to buy if they can do so quickly online, without contacting you first for terms and pricing. I recommend setting up a wholesale section in your Etsy store and offer your best selling items at quantity discount. For example, we offer an assortment of 6 wristlets at 50% off retail.
Note: We stipulate in the listing that the customer must include tax-id in the ‘message to seller’ field to qualify to purchase the wholesale listing. As a general rule, you don’t want to offer quantity discount pricing to your retail customers. The intention is to grow your business with the repeat business of your wholesale customer who will come back to you over and over again to stock their store. A retail customer who buys in quantity will usually do so only once, say for Christmas or bridesmaids gifts. A retail customer cannot offer the repeat business a shop owner can. You will upset/alienate your wholesale customers if you offer the same discount to everyone and consequently they may look elsewhere to buy. " laptop bag by JanineKingDesigns

Trudy adds an uplifting anecdote. "I wasn't expecting the amount of wholesale business that I received before the holidays. I had only been selling on Etsy for a few months, and I was contacted by 3 boutiques for very large wholesale orders (over 600 necklaces). I told my husband that I was determined to finish the orders. I am a perfectionist, so I pulled a few all nighters, being fed snacks and water by my husband who would periodically check in on me in my studio. He would also assemble the ballchain necklaces. The night that we had to package the orders was hilarious. It was 3 in the morning, we were slap happy, trying to bubble wrap the necklaces and singing along to our Ipod. We would periodically take dance breaks to help keep our sanity. With the profit made on those orders, I took him away for a fabulous long weekend to Vermont. My lesson was learned - in my downtime on my summer/winter/spring vacations, stock up!! Wholesaling has been a wonderful experience for me with incredible shop owners. I have a few shops in my city where I take a big batch of necklaces monthly for them to purchase. I just love it when the owners and customers "ooh" and "aahhh" at my work. And, knowing that my product - made with so much love by me - is around the necks of people worldwide, makes me happy."