When selling what you make in a store (let's say candles, soap)

[38carrots]

What is typical for the store to charge you? Does anyone know?

[Julie Smith]

My Mom sells knitted stuff in two? local stores. She is actually charged nothing. Both places sell stuff that when on display needs a little spicing up with something different - which is her knitted goods. She does have tags on the things saying, "Hand knit by Grandma ----" and a note saying the complete purchase price goes to XYZ, which is currently her grand niece in the USA who has cancer.  (We live in Canada)

 

All her yarn is given to her because her full time job involves caring for the feet and nails the elderly, who literally are just dieng to give her yarn. :p (Sorry, bad joke.)

 

ETA: Perhaps she is just lucky. But they sell them for her. If she asks for 20 dollars a hat, they collect that 20 dollars when someone buys the hat, and then gives her that 20 dollars. They make zero profit off her goods. 

Edited March 3, 2016 by Julie Smith

[Spryte]

The store shouldn't charge you anything. They buy your goods wholesale. Set up a minimum order, and expect them to pay net 30. That is, you ship/deliver the order and they have thirty days to pay. Generally, stores want to mark up items for a profit, of course, so the standard is give them 50% off your retail, but make the minimum order hefty enough so that it's worth your while. I have friends who prefer not to wholesale and give a 30% markdown.

 

I never sell consignment. Items that don't sell will return to you shopworn and unsellable. Not worth it.

 

ETA: in ten years of business, only two stores didn't pay their net 30. Both Christian bookstores, which made me raise my eyebrows a bit. :)

Edited March 2, 2016 by Spryte

[Pink and Green Mom]

When I had a home based embroidery business and my products were sold in retail outlets, there was no charge to me.  These stores would buy my product at 50 percent off retail.  Once they bought them they belonged to the store - meaning if they couldn't sell them they did not return them (so it wasn't on consignment I guess is what I'm trying to say). 

 

I was also involved with drop shipping.  My product would be carried with an online only retailer and if someone placed an order I'd ship it directly to their customer.  The online retailers got my product for 40 percent off retail.

These numbers were pretty standard.

[eternalsummer]

wholesale standard is 50%; that is, you sell them the items for 50% of the retail price

 

consignment can be a bit cheaper for you but the sales are not guaranteed; still at least 30% of the retail price generally

 

 

[Tap]

I have seen it both ways.  I have a family member who makes rice packs and sells them.  They have such a huge mark up that some stores just pay her outright for the items and others stores only pay her once they sell.  She has said that she actually makes more money at the stores that do the latter, since there is more risk to her, she gets more profit. (Risks like: shoplifters/damage/wear and tear of items, etc). A rice/barley/whatever pack costs her a $2-3 dollars to make, (filler in bulk, discount fabric scraps and she grows her own lavender) and she makes one is less that 5 minutes, while she is sitting around watching TV....She gets $10-12 profit. They retail for almost $20 in boutique stores.   

 

She has boxes of them and hand delivers to the stores, so the owners can pick the colors/patterns that they think will sell best to their clientele. She only delivers on days that she will be in the areas already, so the drive and delivery time is minimal.  She feels that she clears about $100 per hour that she puts in effort of setting up accounts/sewing and driving. 

 

 

She also made high end, fabric dog beds for a few years.  They didn't sell as well as the heat packs but it was in the recession and she was paying someone to do the sewing.  

Edited March 3, 2016 by Tap