ubure Posted February 13, 2014 Share Posted February 13, 2014 Hi there,I wanted to ask the experienced candlesmakers among you if you give any additional discounts if a wholesaler orders about 500 candles? Shipping costs? Or do you stick with 2-times-your-costs? After having made such disastrous mistakes the last time I had a bigger order I want to make sure I don't do it again.Thank you so much! Quote Link to comment Share on other sites More sharing options...
Guest OldGlory Posted February 13, 2014 Share Posted February 13, 2014 (edited) My opinion and practice ...Yes, I will offer a smaller company a discount for a really big order. However, I have learned to set my prices with enough extra profit (beyond the 2x price) to allow for a discount and still make the 2x price. If your cost is $3 and you would typically sell wholesale for $6, add in another 60 to 75 cents (or Euros). I would suggest starting with somewhere between a 7-10% increased margin and then offering a 3-5% drop for one level of order and 7-10% drop for a level you think nobody will ever reach. Or offer 3 different levels, whatever you are comfortable with.I have worked in retail forever, and this is what all retail companies do. They jack up prices to allow for discounts. It is completely appropriate for you to do it also. The company I work for right now pays a few $$ for their merchandise, marks it at, for example, $16.99, offers a buy one get one for $5, and they are still making a lot of profit.I never offer a discount on something that I have no control over - like shipping. Edited February 13, 2014 by OldGlory add one more comment Quote Link to comment Share on other sites More sharing options...
Daisymay66 Posted February 14, 2014 Share Posted February 14, 2014 Wow..congratulations! That's so exciting! Quote Link to comment Share on other sites More sharing options...
David Fields Posted February 14, 2014 Share Posted February 14, 2014 I completely agree with Old Glory. We pay no attention to the 2X, 3X "rule of thumb" We charge what we feel our customers will pay. We don't give discounts if someone asks for them. We give them our breakpoints for volume buying. And never on shipping. From our experience, once you start giving discounts or free shipping, you can't go back; the customer expects/demands it. You cheapen your products and reduce your profits. We have a store in a mall, and some stores have "sales" going on all the time. Shoppers do not look at non-sale items and only buy "sale" stuff, which forces merchants to raise regular prices and offer deeper discounts to attract business. Crazy. Just like auto mfgs. So, my advice is set a wholesale and retail price based on what you feel from previous sales and your experience that you can get, but with a good profit margin built it. Otherwise, what do you do when your costs rise? HTH Quote Link to comment Share on other sites More sharing options...
marcuset Posted February 14, 2014 Share Posted February 14, 2014 (edited) I completely agree with Old Glory. We pay no attention to the 2X, 3X "rule of thumb" We charge what we feel our customers will pay. We don't give discounts if someone asks for them. We give them our breakpoints for volume buying. And never on shipping. From our experience, once you start giving discounts or free shipping, you can't go back; the customer expects/demands it. You cheapen your products and reduce your profits. We have a store in a mall, and some stores have "sales" going on all the time. Shoppers do not look at non-sale items and only buy "sale" stuff, which forces merchants to raise regular prices and offer deeper discounts to attract business. Crazy. Just like auto mfgs. So, my advice is set a wholesale and retail price based on what you feel from previous sales and your experience that you can get, but with a good profit margin built it. Otherwise, what do you do when your costs rise? HTHAmen to that. Once you start down that road...you make yourself a charity. Take it from a little gal who learned 1st hand the hard way. These guys know what they're talking about. Hugs, Ubure! Edited February 14, 2014 by marcuset Quote Link to comment Share on other sites More sharing options...
ubure Posted February 14, 2014 Author Share Posted February 14, 2014 I am very thankful for your advice! I always tend to give more discount than I intended to...really don't know why. This time I want to it to make sense and I want to make profit. I need to make profit. I've had much largre volume orders before and I always screwed it because my calculation was, well, ...I had no calculation. Only a rough imagination which price my customer would like. Bad idea. I have told my potential wholesale customer that I don't produce a mass product but that this is artisan handwork. If they don't want to pay for that they'll have to let it be.Shipping discount is an option for shipping within Germany, but this depends on the order volume as well. This order is supposed to go outside of Germany - the actual shipping costs apply.(You see I have finally learned a few things!)Thanks again, you are a great bunch! Quote Link to comment Share on other sites More sharing options...
thinkr Posted February 14, 2014 Share Posted February 14, 2014 OldGlory: Thank you for the insight. Do you base your discount levels on number of candles they buy or dollar amount they spend?If it's by number of candles, how do you treat the discount if they order multiple sizes/types of product? Quote Link to comment Share on other sites More sharing options...
Guest OldGlory Posted February 15, 2014 Share Posted February 15, 2014 Actually I have done it both ways. In one instance, I did a large order (1000 candles in 8 different scents) for an insurance company fundraiser. It was so easy - they were all the same size, and only 8 scents, simple labels. I bought all of my supplies in bulk at discounts. But I still made more than the 2x cost.For a smaller company, after we established which sizes she would buy, I offered a discount after she reached a $ amount. You don't want to get stuck doing all votives (if you offer votives) for a company to get a discount. That's just too much work and not enough profit.I think it's important to set minimums for the basics. For example, I won't pour fewer than 6 per fragrance in the 6.5 oz size candles, or 3 per fragrance in the 13 oz size ... or a combination to equal the same amount of wax in the same fragrance. It's not worth my time. And having said all of that, I do have one big client that I've had for 8+ years, they order every 4 weeks, and I let them order whatever they want. But I still always pour a minimum amount of wax, and maybe I have some made up in advance for their next order. Their smallest orders are $300+ and go up to $4000+. Most of us make mistakes along the way and learn how to run our businesses by knowing what NOT to do next time! Quote Link to comment Share on other sites More sharing options...
ubure Posted February 15, 2014 Author Share Posted February 15, 2014 Thanks again OldGlory that#s valuable info.It is what I do now: I told them that MOQ is 5 units of 6 glasses of the same scent. Discounts for 10+ units and the again for 21+ units. Quote Link to comment Share on other sites More sharing options...
thinkr Posted February 16, 2014 Share Posted February 16, 2014 Thank you! Great information. Quote Link to comment Share on other sites More sharing options...
ubure Posted February 17, 2014 Author Share Posted February 17, 2014 a little update: she didn't order. She wanted to have the candles + boxes with custom print on the boxes (which I offered, for additional costs) for the pirce I charge for standard candles with small frangrance label and warning label. I advised her to look for a big candle company with large output who can offer such candles at a smaller price. I really don't know what people think if you tell them your candles are handmade, one by one. Do they think you can sell them for $ 1,50? Quote Link to comment Share on other sites More sharing options...
Lorelei Posted February 17, 2014 Share Posted February 17, 2014 Do they think you can sell them for $ 1,50?Yes they do. Quote Link to comment Share on other sites More sharing options...
ubure Posted February 17, 2014 Author Share Posted February 17, 2014 *lol* I knew the answer! Had another customer today who didn't understand why it shouldn't be possible ordering a few candles at a time and getting 25 or 30% discount for them. Sometimes I think I'm just a fool doing this. Quote Link to comment Share on other sites More sharing options...
Guest OldGlory Posted February 18, 2014 Share Posted February 18, 2014 Look at it this way - during this process you are defining your business. What valuable information! You will learn to see who is serious and who wants something unrealistic. And yes, there are foolish people who think they can walk all over you. Lots of them live here in Tennessee near me, lol. Sounds like you have your share too! Before I have a serious discussion with a potential client, I give them a *HIGH* estimate of what they should expect to pay for a candle. It scares away those who aren't in touch with reality. You have to be tough! Quote Link to comment Share on other sites More sharing options...
ubure Posted February 18, 2014 Author Share Posted February 18, 2014 Yes, you are right. So far I wasn't tough at all, always wanted to please everybody and accept any condition they wanted. It is high time I get aware of this and be smarter in the future.Could have needed this order badly but it doesn't make sense if in the end I have to pay for it all. Quote Link to comment Share on other sites More sharing options...
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