Wholesaling

Updated December 1, 2019 @ 11:00 am

For our purposes, wholesaling means that an artisan is selling their work to a sales outlet, product distributor, or dealer, who will then sell the work directly to the consumer, or further up the supply chain.

Benefits of Wholesaling

• multiple bricks and mortar sales points are possible
• much higher live reach is possible
• diversity of sales locations means more robust enterprise
• higher sales volumes are expected
• you only provide marketing materials for your work and another party is responsible for driving traffic to the retail location
• trade shows can be more lucrative and less risky
• makes it possible to produce multiple product lines or brands out of one production location
• significant and rapid growth is possible under the right circumstances
• this makes it possible to delegate many aspects of the enterprise and focus on the aspects you enjoy

 

Negatives of Wholesaling

• can be difficult to manage cash flow issues (especially initially)
• bigger production means bigger risk
• artisan will be working for a much lower percentage of the selling price per item
• production can be more capital intensive as the artist seeks to produce enough work to supply the market
• less control over the sales channel and message

 

Finance Terms

• many dealers/wholesalers/distributors require a net 90 day period before paying you
• you become a creditor if this party goes bankrupt
• you may need to supply a lot of inventory with no guarantee that the work will sell depending on deal

Trade Shows

• totally different prep than consumer shows
• only sample products are required – not big inventory
• literature is key for dealers
  • they want to know your terms and capacity
  • they want the product story
  • they want to work with pros
• practice your 30 second elevator pitch
• provide realistic production and delivery schedule