selling high end pens

[ragz]

Wasn't sure where to put this but for all the advanced high end pen makers and sellers the question is this. How do you set a wholesale price on your pens? It looks like I may have stumbled into an opportunity to sell my pens to a retailer but I'm not sure how to set a whole sale price to the pens he would be interested in selling. Any info would be appreciated.

 

[theidlemind]

Your retailer needs to be able to sell your pens at about the same price you retail for.
I promise that if you sell a pen retail (at a show) and you undercut your own pen at the retailer it will cause some ill feelings.
So if they have to have a 100% markup then you need to set your wholesale price at half of your retail. Or 60% or whatever the number is.
Hope that makes sense........

 

[Donovan's Corner]

I just sold my first batch of pens to a retailer today and have much to learn, but while discussing profits with the store owner I considered a few ideas.

1. What profit is the minimum I would be happy with if I were to sell 5 pens at a time and didn't have to SELL it to a unconvinced purchaser (now the retailers job)?
2. If I were to give the retailer a larger profit margin would it make him a happy return customer.
3. The sales will generate word of mouth which may lead to more sales.
4. What would I charge my grandmother or other fixed income relative?

Get a product card with your contact information to put with your items to describe the pen type, wood/acrylic type, and refill type.

 

[ragz]

So Idlemind you're saying that if I retail one of my pens at $150 he should as well and that I wholesale to him at $75-$90?
He is a highend seller of Waterman, Schaeffer, Pilot,etc so his profit margin is his to set. If I sold him a pen at $100 and he sold it for $1000 then more power to him. Of course I'd have to relook at my prices

I did happen to purchase a stealth Pilot Nakimi from him today as a birthday splurge

 

[76winger]

So Idlemind you're saying that if I retail one of my pens at $150 he should as well and that I wholesale to him at $75-$90?
He is a highend seller of Waterman, Schaeffer, Pilot,etc so his profit margin is his to set. If I sold him a pen at $100 and he sold it for $1000 then more power to him. Of course I'd have to relook at my prices

I did happen to purchase a stealth Pilot Nakimi from him today as a birthday splurge

I think what was trying to be said is that if you sell the pen to the retailer for 100 and he/she marks it up for sale $500, they're not going to be very happy if they see you selling the same pen online or at a show for $150, serious undercutting the price they're trying to get.

I'd be interested in see how other handle this. Maybe only wholesale a particular line or two of pens while directly selling other lines is the first thing that comes to my mind as a solution. Another might be to up my retail price to more closely match what the retailer is trying to get. I haven't been in this position myself, I'm just tying to think through the practicalities of the situation.

 

[SCR0LL3R]

I am thinking that if Mr Customer comes in off the street and buys 10 pens, why should he not get the same price that I give a retailer who buys 10-20 pens per year.

As for normal customers that buy 1 or 2 pens... I just can't justify charging them 100% more than the retailer who buys 10. Either way somebody is getting the short end of the stick.

Take a simple Sierra ...an easy pen to make... costs me $12 to $14 (costs a little more here in Canada) figuring all material costs. I can't sell that pen for less than $25 to a retailer. Yet I feel I feel wrong selling that pen to an individual for more than $40 or so.

I don't know how to deal with it. At $50 for my cheapest pens, I can't see I'll be selling much of anything in my area. I dunno :frown:

 

[ashaw]

I currently have 28 retailers that sell my pens. Your first cost sold be what it cost you to make the pen with profit and labor. I second price depending on the way you plan to distribute the pen is you distribution cost ( I will add $5.00 - $20.00/per pen covers shipping or the cost of gas). The next price is the retail price. That is double your cost to the retailer.

If you also sell on the web site or shows you also have to sell it at retail. Otherwise you will lose your wholesale customers real fast.

I am ding the Philadelphia Pen show now. I have three dealers there. I round robin the the sales to the dealers so that not one dealer is favored. Also the dealers take 20% off the price of the pen for show special. I will take 10% off there cost because I am getting paid at end of the show from the dealers. Plus it gives them a little extra (customer service).

You have to look outside your area. It take a lot of time and at first a lot of no answers. But you have to keep at it.

 

[ragz]

I have no problem setting my own "retail" price. I've done the 3 times material cost and used an hourly rate. This particular retailer my pens would be displayed along with Lamy, Pilot, Waterman and Schaeffer pens priced from $80 to over $1000. I'm sure he buys these pens ay wholesale and would want a similar purchase point on my pens. He did ask what my pricepoint was and I mentioned it depended on the pen which bought me time since I need to bring him samples to see what he's interested in.

 

[azamiryou]

As for normal customers that buy 1 or 2 pens... I just can't justify charging them 100% more than the retailer who buys 10. Either way somebody is getting the short end of the stick.

Why not? Someone makes the pen, and has to get paid for that. Someone sells the pen, and has to get paid for that. The difference between retail and wholesale is there to cover the costs of selling and pay the seller.

So if you both make it and sell it, it's fair to charge full retail so that you get paid for your time and expenses selling it.

Selling costs time and money, whether it's online (web site fees, photography and post-processing, maintaining the online catalog) or face-to-face (show fees, travel expenses, time spent showing).

 

[studioso]

First find out what is the retail price he intends selling the pen for. If he is good at his trade, he should have an idea of what people are ready to spend on your pens.
Don't ask him straight out what price you think we should sell this pen for: instead say something like:" I usually sell this pen for (highball price here). Do you think that will work in this store?" he might agree with the high retail price (btw, us penworkers, being so critical about ourselves most often undersell our pens anyways) or might tell you that in his area, he customers, will not spend mOre than so and so.

Once you know the retail price, expect to sell it to him for anywhere between 40 to 50%.
That's where you can handle: perhaps start asking for a high %, and than go down in price, but ask in return for things like good placement, or so.

 

[ALA]

I had wondered about this myself (but hated to ask) being that I am new at this pen turning thing. It can be rather costly especially geting started.
Thanks for all the info!

 

[dankc908]

Here's what I have done - not sure if this is the best method but it is my first experience with wholesale selling.

When I retail a pen I triple the cost of blank and kit.
When I consign I ask for 2/3 of retail.
When I sell wholesale, outright, I ask for 1/2 of retail.

This seems to work for me and a couple of my vendors and I still make money. I don't have the 'selling expenses' I encountered when we did craft shows.

Dan

 

[Scooley01]

When figuring retail, do you account for how much of the blank you use?

I know it probably doesn't come up a lot, but doing something like the .50 cal machine gun shell pen, you only need 1 1/8"-2" of blank. I haven't figured if I should be factoring in the whole blank to the price, or just the 1/3 of it that I use.

 

[GrantH]

I still only turn pens on 15 dollar or less kits as I can't order a ton of higher end kits. That being said...sans slimlines....nothing goes for less than 40.

 

[Frank Nemke sr]

When figuring retail, do you account for how much of the blank you use?

I know it probably doesn't come up a lot, but doing something like the .50 cal machine gun shell pen, you only need 1 1/8"-2" of blank. I haven't figured if I should be factoring in the whole blank to the price, or just the 1/3 of it that I use.

When a carpet store sells you carpet, installed you have to pay for all the remnints. When you use a blank, its gone! it should be figured into the cost. You my never find a use for it again. Or you might use it for a give away pen
A close friend in merchandizing told me this. It easy to go broke selling at a profit. There's a lot more exspence in it than just making it

 

[Scooley01]

Well with 99% of kits that's true...but I can get 2-3 .50 caliber pens out of one blank...assuming it's a common color (Lots of requests for Camo acrylic on these), I'd feel bad charging someone for the whole block of material if I later charged someone else for it.

Granted it's really covering my time and effort, but still...

 

[Eyeshooter]

For many of us here who are not producing pens for a living, pricing the fruits of our hobbies is a complicated issue. Do we charge for our time? How about for those blanks that end up in the "ah, shucks" pile? I do not think it is fair to those who DO make a living or rely heavily on income from pen making not to charge a competitive rate. I price every pen as if I used the entire blank on that exact pen and never feel bad about it. After 18 months, I still blow up blanks. That's a cost I need to recoup. My goal is for my hobbies to pay for themselves or I cannot afford to keep doing them. I spent $1600 on my lathe, $400 for a stand and another $400 on lathe tools. I have a $1,500 dust collector so I do not make myself ill. My choice to put in a nice shop but I took the time to learn, I'm currently building a website, donate to IAP and gift a number of the pens I make to help seed my market niche. That all has to eventually break even or my upcoming retirement will become seeking new employment.

 

[Ambidex]

Well with 99% of kits that's true...but I can get 2-3 .50 caliber pens out of one blank...assuming it's a common color (Lots of requests for Camo acrylic on these), I'd feel bad charging someone for the whole block of material if I later charged someone else for it.

Granted it's really covering my time and effort, but still...

I have had the same question..especially on blanks I know can get 2 outa..but then I don't feel too bad when I have wasted more than 1-2 blanks on bad kits, catches, breakouts drilling, so on so forth. I just finished an order for 100...and am NOT feeling guilty for charging full blank prices..especially as acryl camo isn't too pricey when you buy 60 or more at a pop..jmho

 

[azamiryou]

For materials, I price according to how much I can't use on something else, rather than how much is actually in the pen. If I buy a piece of material for $6 and get 3 complete pens out of it, I figure that at $2 per pen. On the other hand, if I use 2/3 of it so all I'm left with is a little piece that may be used for accents on future pens or something, I figure the whole $6 for the pen.

Another way to think of it: if I buy a board and cut it into 30 blanks, each of those blanks is worth 1/30 what the board was, right? I'm certainly not going to figure the whole board price for each pen made from it. Well if you buy one "blank" and cut it into 3 blanks, each of those is worth 1/3 of what the original "blank" was. Even though the store calls what you bought a "blank", for you it was actually material to cut into blanks.