wholesasle pricing

[candicec003]

Hello fellow soapers. I have had the opportunity to have my cold process soap in a local gift shop. While everyone seems to have their own interpretation of what a "whole sale" amount of soap is and what the price should be. While its one thing to agree on a price for the initial large order, what do you guys usually do when they want to buy more after the initial first purchase? Usually they don't want to buy the same large quantity, but want to buy smaller amounts as the product sells. Would anyone like to share what they do in this instance that works for them? Please and thank you

 

[TheGecko]

Hello fellow soapers. I have had the opportunity to have my cold process soap in a local gift shop. While everyone seems to have their own interpretation of what a "whole sale" amount of soap is and what the price should be. While its one thing to agree on a price for the initial large order, what do you guys usually do when they want to buy more after the initial first purchase? Usually they don't want to buy the same large quantity, but want to buy smaller amounts as the product sells. Would anyone like to share what they do in this instance that works for them? Please and thank you

I have been talking to a company about my Goat Milk Soap as their current vendor has a very limited selection. Minimum order would be 2 lbs (10 bars) of any scent, no individual bars. I cure the soap for four weeks before I ship. 50% down, balance upon delivery; the “down” is non-refundable. Soap will be cut, trimmed and wrapped as a loaf since they are selling it under their own label. They are currently reviewing about a dozen different scents I have sent them...neither of us are in a huge rush given the commitment involved.

Price is always an issue as both parties want to make money. What you have to do is figure out what is the max price you can reasonably sell your soap for, subtract costs (yours and the customer's) , then split the difference. And base you costs on the smallest order, but don't forget to pass on the savings (buying bulk) for larger orders.

 

[amd]

Usually they don't want to buy the same large quantity, but want to buy smaller amounts as the product sells. Would anyone like to share what they do in this instance that works for them?

I'm not sure why you think that. Did they tell you that? Because that does not seem like a good buying practice for a store. Typically stores will order x qty, and if it sells they will restock not the amount that sold, but the amount that the supplier offers - whether it's by the case, dozen, or whatever. If it doesn't sell for the store, they discount to move stock and don't reorder.

I do wholesale for a couple breweries, and I set one order qty: my minimum wholesale batch size is 18 bars, which is the largest batch that I make, which is what I determined to be the smallest amount I could do and still be profitable (I include my time in addition to COG).

You need to determine 1) Cost of Goods (COG) make sure you include packaging 2) costs not in COG (this is things like the disposable gloves, freezer paper for lining mold) 3) Your time. (1+2+3)*2=wholesale. For me, it isn't worth doing wholesale for 9 bars (my next smallest batch size) and it isn't worth it to my buyer either, as it tends to be more expensive. For example for 18 bars, I spend 30 minutes making, 15 minutes cutting, beveling, stamping, 15 minutes making and printing labels, and 30 minute packaging. So roughly 1.5 hours * $12/hour which is what I decided my hourly rate is (I'm cheap labor haha). For a 9 bar batch, I have a slight reduction in time spent packaging, and probably cutting/beveling/stamping... but my entire time doesn't drop in half, it only drops by about 15 minutes.
So labor for 18 bars = 1.5*12=$18
labor for 9 bars = 1.25*12=$15
So my 1+2+3 = 16+.20+18 = 21.40 *2 = $42.80 per 18 batch (2.37/bar)... or 8+.20+15=46.4 per 9 batch (5.15/bar).
If your buyer wants to pay a higher price for smaller qty size, then that's what you have to do, you can't offer it to them at the same price, you'll be short changing yourself.