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    How do I determine bulk pricing for my product?
    I'm so stoked! I just reced a call from a resort spa in my area and they want to sell MY organic skincare line in their resort style spa!!!!! They asked about bulk pricing and to be honest I've never sold in bulk before. I just sell a few items online here and there and also at health expos. I don't even know how to begin pricing my products on a bulk level. I want to take the opportunity, but I don't want to loose any money. Can anyone help me?


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    Quote Originally Posted by True Self Organics View Post
    I'm so stoked! I just reced a call from a resort spa in my area and they want to sell MY organic skincare line in their resort style spa!!!!! They asked about bulk pricing and to be honest I've never sold in bulk before. I just sell a few items online here and there and also at health expos. I don't even know how to begin pricing my products on a bulk level. I want to take the opportunity, but I don't want to loose any money. Can anyone help me?
    You figure the spa will mark up your product at least 100% so if you are selling the products at bulk it should be around 50% of what you would sell it for at your retail listing price. But the first thing I would say you need to do is figure out your cost, before anything has been sold how much money are you out for the products and that would include packaging etc. And how much are you selling, are we talking 20, 100 or 1000 products? The price should obviously be less for the more they buy.
    It is very exciting you got this offer and don't undercharge!


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    Congratulations True Self Organics!

    As PoolsRCool has mentioned, you have to determine your actual costs for the product. This includes everything from purchasing from your suppliers, shipping to your location, your time to process the received items, manufacturing, packaging, shop costs (lighting, heat, rent, business fees, etc), labor. Once you know this, you can add your markup and be guaranteed you will always make a profit.

    I offer my dealers a 30% discount off of my retail pricing. They can charge whatever they want and are not locked into specific pricing. On the rare occasions when they want to place a large bulk order, I will base the price on the amount of items ordered. Since I know what my base costs are, I figure out how long it will take me to process the order and base my markup on how much profit I want to make for the order.


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    It's usually best to base your bulk pricing on your production costs, then adding a markup that you're comfortable with, rather than basing it on your retail pricing for small quantities. If your client wants to literally buy in bulk and do their own packaging, that would of course need to be factored in. Or do they want you to provide custom branding and packaging?

    Of course you can afford to give them a quantity discount given that your admin, marketing and "general messing around with communications and paperwork" time has just been reduced relative to quantity of product sold. Congratulations on getting your first big order, and hope there will be many more to come!


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    Like already mentioned the first thing to do is to calculate costs. I would NOT factor your own labour into these costs. Then when you have the costs, you also need an idea of just how much they want to order. Then you can calculate what sort of markup you would need, at the minimum, to be comfortable with the amount of money you are making from this deal.

    Seeing as it's your first big order I'd be willing to sell it for a very low markup if necessary, this deal is very important for getting exposure for your product.


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    Here's a basic method for starting off with figuring out what your bulk pricing should be.

    You want it to be competitive, so do some research of other product lines that are similar to yours and see if you can figure out what their bulk prices are. This might be harder to do if you're not ordering from them, so then take some other key factors into play.

    What price do you generally sell your products, individually, at?

    How much does it cost YOU to produce or make that product, per individual product?

    Now consider the main principle in business as the more bulk you buy, the less it is per individual product.

    Example: I buy 1 skin care lotion for $14.99 at a store. That's the MSRP of that particular item generally speaking throughout different stores. Now I contact the supplier and say I want to sell their products for them and I want to buy bulk. Minimum purchase amount is a quantity of 10. $150? No thank you, there's no profit there. They'll bump it down based on the amount you purchase. Now 10 items, is not a significant amount so the bump down might not be significant either. Now let's say they purchased 100 of these items at once. It costs you $5 per product, so you'll bump it down to $10 per, so they get a $5 profit and you instantly receive $500 profit from the whole order.

    If you give me specifics on the numbers for questions I initially asked, I can help you determine a fair price.

    Hope that helps though.


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    Quote Originally Posted by crimsonghost747 View Post
    I would NOT factor your own labour into these costs.
    I disagree with this method, crimsonghost747. Labour is one of the highest costs in business, and must be accounted for or you risk selling the items at a loss. As an example, if it takes me 10 hours to create, package and ship 1000 items, and my wage was $10.00 per hour, that is $100.00 (plus the associated EI, benefits, taxes and peripherals) that I have to pay. Not accounting for this $100.00+ could easily end up costing me money.


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    Determining bulk pricing for your product is a tricky prospect. You have to keep in mind a number of things while deciding the bulk price of for your product. You would have to keep in mind the shipping costs you would have to incur. You could categorize it in terms of number of units to be shipped and the distance of the destination from your warehouse. The next thing you have to keep in mind is the cost of packing the units. You can categorize this in terms of number of units which you have to pack for the buyer. The last and the most important thing you have to decide on is how much of a discount you have to offer on the original price of the product. It basically depends upon the nature of competition in your industry and how much economy of scale you get while processing bulk orders.


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    Just get your retail pricing and multiply it by the amount of pieces for one bulk or a wholesale. Then just discount let say 5% for the entire bulk whether it is 50 pieces or whatever. This way you cannot lose money, you'll earn more since a lot of your items are sold at one time.


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    Quote Originally Posted by PoolsRCool View Post
    You figure the spa will mark up your product at least 100% so if you are selling the products at bulk it should be around 50% of what you would sell it for at your retail listing price. But the first thing I would say you need to do is figure out your cost, before anything has been sold how much money are you out for the products and that would include packaging etc. And how much are you selling, are we talking 20, 100 or 1000 products? The price should obviously be less for the more they buy.
    It is very exciting you got this offer and don't undercharge!
    Good advise. Health and care products in spas have a very high markup. That's why I agree on that 100%, else I wouldn't estimate it that high.

    What you do is, you product a batch and see how much everything costs. Don't forget electricity, maybe internet, a portion of the devices needed (estimate how much you can produce with those devices), ...
    Then calculate what it costs to make 1 item of your product.
    Then give yourself a 50% extra.


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