This is the first in a series of 5 episodes covering the different areas of selling and pricing your work. The goal with this series is to discuss and help you find ways to sell your art, create consistent revenue, and build relationships with the outlets you sell your art through. Whether distributor or retailer.
Today we are diving head first into selling to a distributor.
I personally sell my work through 2-distributors and several retailers directly. The benefits of both allow for a consistent income without putting all your eggs in one basket. On one hand you have a catalog that has a broader reach of distribution allowing more exposure for your line of work.
Most distributors take a 15-25% fee off the top of the wholesale. If you sell an item for $10.00 wholesale the distributor will then pay you $7.75 per item. If you calculate your time and gas that it takes to drive around and hope to sell orders it is way more beneficial to work with a distributor. When you first start out I recommend starting off selling to a select few shops and have then help you find the right pricing based on their customers feedback. In the long run you can then fine tune your line and become more consistent which you can then approach the catalog companies.
When you begin building relationships with distributors it is important to know that you will need to mail off FREE samples giving them a physical sample of your work. This allows them to settle on pricing and then if they accept the item they have it for photographing it for their catalog.
If you decide to go this route there are a few details to take into consideration.
1. distribution companies tend to buy in bulk which means you will need to be able to keep up with orders if your lines sell well.
2. purchase materials in bulk which will save you a ton in overhead. if you order 6 or more cases then frieght will be an option to ship saving you tons of cash in the long run. Wait till companies like mountain glass have a monthly sale on clear or a color company.
whether you buy your material in bulk or single cases always estimate your cost to manufacture based on regular pricing, not the sale price as well as always include shipping in the cost of the case. if you buy a case of 1" hvy wall and it costs 130.00 before shipping then the actual cost will be around 165.00- then devide that cost by the number of tubes in the case.
Below is a basic calculation you can use when figuring out cost of manufacturing your items.
How to calculate cost of production
In this example I'm using reference from internet which has material price based on length .....
This is a generic example
example 3"-wrap and rake hand pipe
Material breakdown :
2" section of simax 25.4 hvy wall ($8.00/60")
$0.13per inch or $0.26(2"section)
1/2" section of color cobalt firsts ($5.25/18")
9" section 4mm clear for raking ($0.52/60")
Estimated total for cost of Goods
3"wrap and take spoon ($0.26+$0.15+$0.09)=$0.50
Propane/oxygen/power is pennies on the dollar if you're able to get liquid oxygen. If you are renting space you still need to calculate your estimated per hour rate. If you pay $1500.00/mo(power,rent,gas) break it down to per day then estimate how many hours you work in a day and use that number as a base calculation.
$1500.00/month (30-day month) is approx $50.00/day (per hour in a 10-hr day)
If you can make 10-$5.00 3" wrap spoons per hour your estimated cost per hour is $10.00/hr
(power,rent,gas) $5.00+(material x's 10-hr) $5.00= $10.00/hr. to manufacture 10-$5.00 spoons
Net-$50.00(10-$5.00 3" w/r)-$10.00(cost to manufacture)=
Gross approx $40.00/hr.
In a 8 hr day do the math
You can see just by getting a good base line down for estimating your cost to manufacture
you have the ability to make anywhere from
$30-60.00/hr gross profit
Net =income-cost to manufacture =profit
Now take 15% of your gross and put that aside for TAXES !!!!
GO TO WWW.WYZGUYMEDIA/RESOURCES FOR A DOWNLOADABLE FILE TO FIND OUT WHAT YOUR BASELINE COST TO MANUFACTURE YOUR PRODUCTS ACTUALLY IS.