First, let me apologize for being a bad blogger. I have the best of intentions, I really do - but so many other things really have to come first and this blog always seems to slide down the bottom of my to-do list. I'd promise to be better about it, but I know it's unlikely I'll ever be a weekly blogger. There are always going to be busy times, or weeks I can't think of anything to write about, or when the topics I do want to write about seem like such a big project that I keep putting them off until I have more time. (And when exactly is that, anyway?)
So I'll just trust that you have lots of great blogs you're following and hope you appreciate that there's one that doesn't overload you with posts.
And now, on to the subject of wholesale terms:
Every artist who starts in wholesale has to start by establishing their terms, and most are confused and overwhelmed at the thought of it. So if you don't know what 'terms' means, know you're not alone and relax. I'm going to give you a simple explanation that should make this task a lot easier.
When you start approaching buyers, whether at their store or at a show, one of the first questions they are likely to ask is "What is your Minimum?"
Minimum refers to the minimum amount you require for a wholesale order. Most wholesalers have a minimum opening order – which is the first order they place with you, and a different minimum reorder. Deciding what your minimum will be depends on a few criteria.
1. Every order must be profitable for you.
2. Your minimum opening order should create a nice display of your work but at the same time not require a huge investment for the buyer who is taking a risk on your line for the first time.
3. Your minimum reorder should make it easy for the buyer to restock and replenish their display long before they run out.
Your opening order is always larger, because you want to make sure the store carries and displays a strong mix of your work, enough to show it off and enough variety that there are choices for everyone. You also want the store to make an investment in your work. It motivates them to display and sell it well. Having a few items scattered throughout a store does not show your work well and generally doesn’t sell it as well, so small opening orders don’t serve you or the buyer.
Your reorder minimum should be smaller. My opening minimum is $200, my reorder minimum is $100. I want my buyers to be able to keep my display full and fresh without a big investment and with a smaller minimum they can reorder more often instead of waiting until they run out to reorder. In other words, if they have sold half of their first order, buying another $200 worth at that point might be too much for them. But they can easily refresh and fill out the display for only $100. And when I introduce new items they can easily buy a sampling of those to add to the line.
So, while it’s tempting to require a large minimums, remember that if you do it will not only turn away new buyers who don't want to spend too much on a new line, but it will also take longer for the store to run low which can make it look like your work sells slowly. The faster they see it disappear, the better!
Now, exactly how do you structure your minimum? Really, this is up to you.
You can require a minimum dollar amount or a minimum quantity of items. You can also require a buyer purchase a quantity of each color, each style, each item or each design.
For example: I can require that when ordering magnets a buyer must order 2 (or 6) of each design and order a total of 4 dozen. I allow my buyers to order anything as long as it adds up to my total minimum, but not every artist does. You can require that they order 48 pieces, 10 sets, or for example, a glass earring can be sold in sets of six, with the sets available in a variety of colors.
Some stores might need special consideration. I sell to several stores that only sell pet items or ladybug or horse themed items. For those stores I allow a smaller minimum since they have a narrow focus and I only have a few items that will work for them.
When you set your minimum, figure out what works for you, and then always put yourself in the shoes of your buyer. It’s your job to make sure your policies work for them too. As I have said here before, your relationship with your buyer is a partnership. If they do well, you do well and vice versa.
As always, if you have any questions about wholesale or any other topic please leave a comment or email me at email@example.com.