fbpx
Wholesale products

I get this question a lot from my clients because wholesale products requires the sharing of profits with the retailer, so the margins are lower in your business. While it isn’t right for every business, I have helped several clients with very successful wholesale and consignment lines of business that rapidly grew more income, greater audience following, and ultimately a larger retail base.  Here are a few reasons that wholesale and consignment can be great for your business.

 

Wholesale Products

 

 

Wholesale Products: Larger orders than individual sales

 

When any customer buys you should do a happy dance. But when a wholesale customer buys it’s a bigger order and a bigger happy dance. If a customer buys one, a wholesale order can buy 12. Even with the loss of margin, you have more volume, and you make more income.  Just make sure your numbers are right on the wholesale and retail prices.  Know your production, packaging, and labor costs.  I have several clients with retail margins over 60-80%, so wholesale margins are still beautiful even sharing 25-40% with a retailer.  Take the time to build a solid relationship. Give them the product knowledge and watch how your business customers begin to promote YOUR product when people ask for suggestions.

 

 

Wholesale Products: Introduction to their audience

 

And the reason you don’t mind giving margin to the retailer is… because you are being introduced to their audience! They are paying for their storefront, labor, overhead, etc., and you get to be an option for the customer base they spent time and money building.  They are making something, and you are still making something. It is a win-win. You get shelf space, physical or virtual, and the visibility.

 

 

Wholesale Products: Reordering more frequently

 

Another aspect of wholesale is that there are more frequent orders from the buyers. Individual consumers buy maybe a few times a year (depending on the product) but businesses are going to order as they are selling. A key here is to be organized and to be a great account manager. Know the business owner’s intentions with your product. Learn what is selling and what isn’t.

 

Again, build that relationship. Make suggestions, call, and ask for the reorder (don’t make them run out first), and for the love of all things holy, don’t take it personally if an item isn’t a hit with their audience.  The reorders from a business are generally larger than an individual order, so more volume, more income, more chances to serve the business owner and their audience.

 

 

Converting fans to direct retail

 

This happens frequently. After a time, the customer may begin to order directly from you, at retail.  This happened to us with the coffee business. People bought our product from a local store, then joined our Facebook group, then directly ordered from us.  I’ve seen this happen with several clients of mine as well.

Make sure to have your website or online store on your product label.  But please note: DO NOT undercut your wholesalers with deep discounts online. It’s very disrespectful and will cause you to lose wholesale business fast. The retail price is the retail price. If you buy from me, from them, or from the other them. The ONLY time I’d think about discounts would be if something is discontinued or you are discounting wholesale as well, the margin remains the same for the retailer.

 

One last thing, consignment can be a great way to test out a relationship with a potential wholesale customer. Offer to let them try it out in their business for a time, say 30-60 days, and after it sells out, you would be happy to have them as a wholesale customer. The difference is that on consignment you are paid only after an item sells. In a wholesale account the business customer owns the item once they are purchased at the wholesale price.

When you aim at nothing, you will hit it every time” – Zig Ziglar

This is the quote that reminds me to set my business goals, and that includes financial goals.

Some entrepreneurs are a bit timid in setting income goals because they just want to sell as much as possible. Others set super stretch goals that they will never reach with the belief that “if you aim for the moon and miss, you will land among the stars.

I understand both approaches. I want to offer you an approach that falls somewhere in the middle.

 

If you don’t typically set goals right now

 

How much money do you want to make, and in what timeframe? That can feel like such a loaded question.

Does reading that have you thinking, “What if I set it wrong? Too low or too high? Am I going to be disappointed? What if I miss it?” right away.

I hear you. The fact is goals don’t have to be arbitrary or decided by throwing a dart at a bunch of numbers. Here are a few questions to help you narrow down a good goal.

 

1. What am I offering, how much does it cost?

 

How many can I sell? This question will help you look at your capacity to make more money. This may be limited by your time, by your production model, or by your own working guidelines.

If you don’t know the maximum that you can comfortably make with each offer in a month, you can’t begin to set a goal, because you can’t figure out what to sell and how many.

 

2. What is my best sales month ever?

 

What made it so good? Was it a new ad? Did you host a challenge? What was it?

These questions can help you to examine what you did in your best sales month, and whether you can duplicate it or do more now. What are you available to do to hit your goal this month?

 

3. What is the purpose for the money?

 

Having a purpose can definitely help you gain clarity on your goals. If you to make $3,000.00 so you can launch a new thing,  then that’s a pretty clear purpose for the money.

Get laser focused on what you want the money for and what it is going to do for you and your business when it is earned.

 

If you set arbitrary goals that you always miss

 

First, follow the questions above! And check on your capacity, availability, and purpose for the money and the goal.

Then ask yourself if it would be better to keep the lofty goal as a “best” goal, but add in a “good” and a “better” goal that is more attainable.

For example, if you set your goal at $10k for the month, but your best month has been $2k and you don’t have the availability to do more than $6k, you can set a “good” goal at $3k (attainable) and a “better” goal of $6k, the “best” (or stretch) goal of $10k.

There is a real psychological boost to you as an entrepreneur as you reach your financial goals. For each of the three goals, make sure you have a clear purpose for the money.

It takes just a few minutes to set your financial goals. It can be for the week, month, quarter, that is up to you. But make sure you have something to aim at and then define the availability and steps you need to take to hit your mark.

By the way, The Profit Accelerator is open again! Grab one of the 12 spots inside the signature program that has helped entrepreneurs focus on making more money and keeping more profit in a six-week sprint. Visit https://entremoneycoach.com/accelerator to learn more.

Wishing you the best with your business goals!