5 Insider Tips for Successfully Wholesaling Your Handmade Products

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I started my business with great passion and a big dose of optimism, but absolutely no relevant experience.  I knew next to nothing about the gifts & homewares industry.  I had never worked in a retail store.  Terms like ‘merchandising’ and ‘PoS’ meant absolutely nothing to me.  Looking back, I realise that a lot of the rejection I received in the early years was due to my not understanding the rules of engagement.

I wish I’d had a checklist back then to help guide me, rather than simply following the process of trial and (a lot of) error.  I offer the following insider tips from my own experience over the past 15 years from both sides of the counter, both as a maker and a retailer selling handmade products.

 

 

Branding – too much is too much
Branding is really important to get right.  Attaching your logo to everything you make helps establish your business and makes it easier for customers to identify your products. 

Most retailers will display your branding if it is attractive and it adds to the perceived value of the item.  For handmade goods, a quote or phrase that shares something about your story as a maker can be really attractive.

However, don’t try to include all your contact details on every product.  Your business name and logo are all you need.  Everyone knows how to Google your brand if they are interested in more information.  Even for the sake of quality assurance or customer questions, do not include your email or phone number.  Nothing irks shop keepers more than makers who seem to be trying to direct customers back to themselves.  

 
 

Delivery Times – don’t promise more than you can give
If you make everything by hand, and you suddenly get an order that equates to six weeks worth of work, then be honest with your stockist.  Most retailers expect lead times, but it’s up to you to set the boundaries and manage expectations.  Conversely, if it normally takes you three weeks to fill an order, but you happen to be able to do it within one week this one time, then make sure you let them know that this is a bonus and not normally possible. 

As a general rule, I add one week to my estimated delivery time, which eliminates potential disappointment or frustration for my stockists, and gives me a bit of breathing room in case anything is delayed or needs to be redone.  Plus it’s nice to surprise people occasionally by being earlier than expected.

It’s much more important to set realistic deadlines and keep to them, than it is to promise unrealistic delivery times that might affect the quality of your work, or have you working insane hours as you desperately try to finish an order. 

If you have a busy time of year, then give your stockists plenty of notice so that they can order 2-3 months in advance to give you enough production time.  Most stores will plan their buying a season ahead, and they are used to early cut off dates for Christmas ordering.

  

  Don’t under-sell your stockists
The basic formula that most gift and homeware stores will use in pricing the products that they sell is to add 100% plus gst.  Trust me, this does not make the store rich on your hardwork – it simply helps to cover the high rent, wages and the other expenses that come along with running a successful store in a prominent position, meanwhile giving you the exposure to thousands of customers you would struggle to connect with otherwise.

A common mistake that many makers fall into is to undervalue their work.  Once you start selling wholesale, you have to uphold the value of your product.  And that is not the price that you charge your stockists; it is the price that they sell your items for to their customers.  By setting your wholesale prices, you are also setting the retail value of your products. 

The worst thing you can possibly do is go to your local market and sell your products at just above your wholesale rates.  In pursuing a few extra sales in the short term, you are undermining the value of your products and brand, and breaking trust with your stockists.  You might think that no one will notice, but as your brand gains more exposure, you’d be surprised.  Many of your customers will know exactly how much they usually pay for your work, and suddenly finding it much cheaper somewhere else can actually diminish the value of your work in their minds.

 

  

Consignment – trust me, don’t do it
I’m going to be brutally honest here.  I would almost NEVER recommend putting your work into a store on consignment.  It is messy, a burden on both the maker and the seller, and it generally indicates a lack of confidence in the product.  The one exception to this is if you make very high priced, one off pieces.  Even then, I’d exercise caution in considering consignment.  Issues of damage and theft, as well as confusion over stock levels as you bring in extra work, can mean a loss of profit for you, and it can really sour your relationship with your stockist.

My experience as both a maker and a retailer is that if a store has confidence in a product, it will usually sell well.  Products sell best in large attractive displays, not in little dribs and drabs dotted around the store.

Focus your attention on stores that really know what they are doing.  Their owners/buyers will generally have years of industry experience, and they will know by instinct whether a product is right for their customers or not.  Smaller stores or inexperienced owners/buyers tend to prefer consignment, as they may not have the confidence in their own spending decisions.  This doesn’t usually translate into high and frequent sales for you.

 

  

A good stockist is your best business card
A successful store will have a well developed relationship with their customers, so if the store loves your product, their customers tend to as well.  Work with the staff to give them plenty of information about you and your products, so that they can answer any common questions that come up.  Every time they tell your story, it helps to cement the value of your brand, because customers will align your brand with the good name of their favourite store.

If you ever have to provide replacements for damaged/faulty stock (don’t worry, it happens to everyone now and then), arrange to do this through the store where your work was originally purchased, rather than directly with the customer.  It is great PR to let the shop know that you value their support of your brand, as well as their good relationship with their customers. Providing replacements in this situation should actually be a greater priority than delivering a regular order.  It is your golden opportunity to turn a negative into a positive experience for both your stockist and the end customer.

Finally, as your stockist list grows, you will notice that some stores order more regularly, and sell far greater quantities of your work than other stores.  These stores are generally industry leaders, and can influence trends throughout the gifts & homewares industry.  While I have around 50 regular stockists of my candles, almost every new stockist enquiry that I receive mentions that they saw my products in one of two or three stores.  When you discover that you have a powerful champion in the industry, take note.  Look after them and listen to their guidance – this insider wisdom can be incredibly valuable to the success and growth of your business.

Over to you!
I’d love to hear of your own experiences and hard-won wisdom.  If you have any comments or suggestions, please jump in and join the conversation below.  Most importantly, if you have a question, please ask it.  Let’s pool our collective wisdom and help local small businesses thrive.

 

 

 

A little gift for you
I have recently teamed up with some of our best Australian makers and designers to put together a curated collection of gift boxes for all occasions.  Pop over and have a little look – I’m thrilled to be able to share so much handmade goodness in these beautiful gift boxes.

Use the coupon LOVEHANDMADE78 during August to receive $15 off your first order of any of our gift boxes.*

We’ve got you covered for Christmas, Baby Showers, Mothers Day, House Warming Gifts, Birthdays & Anniversaries, and most especially for those times when you just want to spoil someone and show them how much you care.

* This offer is limited to one coupon per customer, and is only available until 31st August 2017.