I Need Advice About A Big Order

[SueH]

At Christmas I gave everyone in my dentist's office a bunch of lip balms and they loved them. Well today I got a call from someone from the office and the dentist wants to purchase some to give to his patients. Wait till you hear this! 1000-2000!!!!!!!! :grin2: How much of a discount should I give with such a large order? I'm very smalltime and don't know diddly about large orders. I generally charge 1.00 per lip balm. Help!!!!!! I'm so sxcited!!!!!

[dcroome2005]

I don't make these so I can't help you but I want to say CONGRATS on the order!

[debscent]

That's great! How much does it cost you to make them? I'm assuming with buying supplies in such bulk you will save. I don't make lip balm so I can't even begin to help, but a 25% discount would seem fair to the dentist, he wouldn't expect them for nothing. If he does, ask him for free dental services for a year!

[barncat]

Did they ask for a discount? Don't give them one if they don't ask or expect one. Maybe give a few extra or make a thank you gift for the office emplyees.

[MsDammit]

That's great! How much does it cost you to make them? I'm assuming with buying supplies in such bulk you will save. I don't make lip balm so I can't even begin to help, but a 25% discount would seem fair to the dentist, he wouldn't expect them for nothing. If he does, ask him for free dental services for a year!

I ditto that, with the cost of dental services I'd opt for free services, 'specially if ya got kids, lol.

[Scented]

Can't help you with the cost break but congrats on the order!

[sockmonkey]

What do you normally charge for them? Did the office ask for a discount? My sister works for a dentist, and I know they, like everyone else can be tightwads, or extremely generous.

If they didn't ask for a discount, give them your normal price. Then ask the person if that fits within their budget. If they say no, ask what they had in mind and see if you can afford to to it for that.

Like someone else suggested, perhaps you can get some free dental treatments--teeth whitening sound good?

My gut instinct tells me $1 ea should be a reasonable price but for freebies, you never know what they expect.

[woolfswickery]

I do not do lip balms but if someone called me with candles like that.

I would do the cost for making them and mark up some. See the difference in what you have there and then selling them for your $1. Also something else you could consider ask the dentist if he would like to have on the label his name. Like you have especially made for DR.DENTIST Blah blah. If that be the case he may be willing to pay any extra with out a discount.

Good Luck

[HeavenScentU]

Are located in Ririe, ID?? I just went to the dentist and they gave me a real yummy lip balm called strawberry cheesecake. Very cute and professional label. I didn't notice at first until I was putting it on my lips and smelled the fragrance. I thought it was the store bought stuff. Smells more like butterscotch, too me...

[LynnS]

I agree about "not asking for a discount don't give one".I don't make lip balm but IMO the smaller the more work.Candles at times can be a breeze but I guess large orders of lip balm could too.

My opinion he makes enough money to pay full price.Who knows maybe he can take that out of the business and not his own pocket.I am sure that could be done.For non profit giving(I know for a fact on that) businesses take that off on taxes.OF course this is a small gift to all patients and might be different but sure he could do it.FULL PRICE!!!!!!

LynnS

[mystical_angel1219]

At Christmas I gave everyone in my dentist's office a bunch of lip balms and they loved them. Well today I got a call from someone from the office and the dentist wants to purchase some to give to his patients. Wait till you hear this! 1000-2000!!!!!!!! :grin2: How much of a discount should I give with such a large order? I'm very smalltime and don't know diddly about large orders. I generally charge 1.00 per lip balm. Help!!!!!! I'm so sxcited!!!!!

One dollar is cheap! Don't deviate from that price, IMO.

You have to pay yourself for time, product development, supplies and advertising. Your wholesale price should be at least twice the amount of all your expense PER unit. Including waste, and if the cat climbs on the table.

Congrats on the big order!

[elle110]

One dollar is cheap! Don't deviate from that price, IMO.

You have to pay yourself for time, product development, supplies and advertising. Your wholesale price should be at least twice the amount of all your expense PER unit. Including waste, and if the cat climbs on the table.

Congrats on the big order!

My thoughts exactly, your $1 retail price is lower than my wholesale amount, when you compare homemade lip balms to those cheap, petroleum, mineral oil based ones our should be more since we, or I do, use high quality ingredients. I wholesale mine for $1.75

HTH

[sockmonkey]

People charge what the market will bear. That is a lesson that everyone learns at some point.

In the world of lip balms, even Avon sells them for less than $1 sometimes.

I can make a lip balm for $.30 per tube--including the tube, ingredients, and label. Maybe she can too. If she normally sells them for $1 each, then she obviously has room to play with the numbers too. Would I drop my price to $.75 if necessary to get the job. You betcha! When you've only got $.30 invested, you're still more than doubling your profit at $.75. It would be worth my trouble to make $450 in profit.

[mystical_angel1219]

Again, I cannot stress this enough- DO NOT sell yourself short.

Honestly, it is the biggest mistake to ignore "perceived value" and "logistics" when you do pricing for your products, especially wholesale.

You are not using el cheapo filler ingredients like petroleum, lanolin and mineral oil. These lip balms are handcrafted. Doesn't mean that they should be ultra cheap. Avon is the largest beauty purveyor in the world, and they change like the wind. Because they can spend millions of dollars in R&D, target markets and advertising. Even if this dentist is selling them at 2.00, which is REALLY cheap, he would be making 100% profit. What more can he ask for?

I'd make him pay upfront as well, no question.

I would not do 1000 lip balms for less than 1.00 a piece, wholesale. Not even 999. This is ALOT of work! I just paid $7.00 for an organic lip balm at a specialty store, because I want to work on formulating something similiar. There were hardly any flavors left- believe it. I've seen essential oil blends in this store flying off the shelves, at $28.00 for 5 ml. Crazy, huh?- but true.

I see way too may incidents where crafters are selling themselves short. I know logistics has alot to do with it, but think your pricing out carefully. It is much easier to lower a price, than raise it. You have to pay yourself, just not taking your supply cost and mulitiplying it. You have to consider people that look at something cheap, and put it down. Why? Because they would never pay LESS for something that is quality. These are customers you want to target, IMO. Not the cheapskates that want deals and everything super duper cheap.

[LynnS]

It might cost 30 cents to make BUT the time it involves.I know that all to well.I am so reasonable and then boom it took more time than I imagined.Made 120 packs of tarts and 2 per pack.Charged only 80 cents because a big order IMO.Won't happen again.It took forever to pack, make bows and label.So forget that.She is back but price goes up.This time it is for something else though.

LynnS

[KristinesShower]

Don't forget - more product means more work!!

No discount, instead offer them 10 free samples of something or better yet put together a little basket to show your thanks.

[sockmonkey]

Again, I cannot stress this enough- DO NOT sell yourself short.

Honestly, it is the biggest mistake to ignore "perceived value" and "logistics" when you do pricing for your products, especially wholesale.

You are not using el cheapo filler ingredients like petroleum, lanolin and mineral oil. These lip balms are handcrafted. Doesn't mean that they should be ultra cheap. Avon is the largest beauty purveyor in the world, and they change like the wind. Because they can spend millions of dollars in R&D, target markets and advertising. Even if this dentist is selling them at 2.00, which is REALLY cheap, he would be making 100% profit. What more can he ask for?

I'd make him pay upfront as well, no question.

I would not do 1000 lip balms for less than 1.00 a piece, wholesale. Not even 999. This is ALOT of work! I just paid $7.00 for an organic lip balm at a specialty store, because I want to work on formulating something similiar. There were hardly any flavors left- believe it. I've seen essential oil blends in this store flying off the shelves, at $28.00 for 5 ml. Crazy, huh?- but true.

I see way too may incidents where crafters are selling themselves short. I know logistics has alot to do with it, but think your pricing out carefully. It is much easier to lower a price, than raise it. You have to pay yourself, just not taking your supply cost and mulitiplying it. You have to consider people that look at something cheap, and put it down. Why? Because they would never pay LESS for something that is quality. These are customers you want to target, IMO. Not the cheapskates that want deals and everything super duper cheap.

Just to set the record straight, I believe she said the dentist is GIVING them away, not selling them. When people are looking for giveaways, they general don't expect to pay too much for things.

Here's the thing... they came to her, she didn't hit them up looking for a sale. If she's already selling them at $1 ea, and is comfortable with the profit she's making, why would you suggest she raise her price to a potential client who has already tried it and loved it? I doubt the dentist will look at her product as cheap and inferior, since they know what they are getting. They will probably be plesantly surprised by the price and might will go with the 2,000 qty instead of 1,000.

If she was already selling them at $3.50 a piece, then I would agree with everyone she shouldn't slash her price down to a buck. But the fact is, she isn't. The other thing to consider is that this is an EXCELLENT marketing tool for her. The people who will be receiving her lip balms are right there, in her own community, which means 1,000 - 2,000 potential clients for her products in the future! You never know, this dentist might even be willing to sell them for her in his office if this goes over well.

There's no need to get hung up on perceived value at this point. Yes, making that many lip balms would be time consuming and labor intensive, but this is an opportunity that should be taken advantage of.

[mystical_angel1219]

Sorry sockmonkey, even if the dentist is giving them away, 1.00 is still one hell of a deal for a wholesale lip balm. Promo items are necessities to any business, but I am sure this man is more than willing and able to pay her a fair price. This isn't mass manufactured little tubes of toothpaste we are talking about here.

Not only is he improving people lips, so to speak- he is taking interest in promoting a local business. This to me speaks volumes to me about his mindset and how he treats his patients. Doesn't sound like some cheap idiot.

I do agree this is an opportunity that should be seized.

However, it still involves alot of work. Orders this size require time, effort and planning. This should be considered, IMO with the pricing. Even with the potential exposure, you have to try and remove the hobbyist mentality when it comes to time and money.

Also, you can never instill ENOUGH the importance of looking at the big picture when it comes to any business practice. Perceived value included.

KristinesShower gave a fantastic thought, of giving him a gift basket.

Who knows, he might even sell other products down the road.

[sudsnwicks]

I think $1 is cheap enough that you needn't lower it, especially if he isn't asking for a price reduction. The thank you basket (as suggested by KristinesShower) is a good idea though, especially since this is such a large order.

[clonefan80]

when someone asks me if they get a discount when ordering in bulk my reply is "no because my products are already priced at a great low price," and leave it at that, no other explantion needed.

[sockmonkey]

Promo items are a good thing, but a necessity in a dentist's office--no. Who knows when he plans on handing them out. Since they got them during Christmas last year, maybe he thinks it would be nice to hand out to patients this year at Christmas time. Typically, professional offices might hand out inkpens, or calendars during the holiday, for which they have paid $.25 or less. A $1 item might be extravagant for his purposes. You never know.

Another factor in pricing as I stated before, is the market you're in. I see Mystical is in NY. I don't know where SueH is, but if she's somewhere like AL, or OK, it simply might not be practical to expect such "high dollar" items as giveaways. These handcrafted items are indeed different from the mass produced items. They are not lab tested, there is no oversight during production, and chances are, there is no lavish packaging, and who knows if she even carries product liability insurance. So, when you want to talk about perceived value, maybe you should consider that as well.

No matter how our opinions may differ, I'm sure we are all just providing them as support for Sue's ventures, and hopefully they will be helpful to her. I would certainly like to hear from her and what her thoughts are now, and especially, how much it costs her to make a tube of lip balm! That's the one missing ingredient in this whole equation.

[mystical_angel1219]

You offer valid points, do not think I discount that in any way.

It is always good to hash ideas and opinions combined with experience.

The common denominator here is helping someone make the best of a fantastic opportunity. Logistics add a rock into the equation. I once asked a fellow CTer why she was charging only 4.00 retail for an 8 oz candle. She was in one of those states where she had to, based on per capita income. Her market just wouldn't work with a higher price tag, she stated. Perhaps it's my sales mentality, and the fact that the cost of living here is pretty high. I have visited a few craft shows here, and a "handcrafted" dish towel was 10.00, and they were selling like wildfire.

When I speak of perceived value, it means many facets.

Packaging, ingredients, advertising and business image, mostly. How others perceive your product vs. mass manufactured, made in China- low quality types of items.

So, I guess it would be wise to wait for the final numbers.

What it costs per unit, and how many this dentist is going to buy.

[Candle Man]

Sounds like a great opportunity to get your name out there and maybe more sales.

If you do decide to do this order it will be time consuming. To cut down that time you may want to invest in some of those lip balm filler trays. You just attach tubes, pour balm in tray then scrape top of tray. You can do 100's at a time this way and save lots of time.

BTW - Here is some links for the filler trays

http://www.serftosurf.com/lt.htm

http://www.plastictom.com/products.html

http://www.thesage.com/catalog/Equipment.html

[sockmonkey]

You're the best, Candle Man.

[LynnS]

I agree " depends where you live".I know that all to well.People are losing their jobs everyday where live and they made quite a bit of money.Even been forced to retire but before that decision was made they wiped out savings.So this year craft shows will be so so.I sell 8 ounce JJ for $5.00 and not a dime more.If I did they would sit.At shows sometimes do 3 for $12.00 but really sales have to do alot with that certain scent and pricing.

I just think a dentist can afford the cost IMO.He never mentioned a deal or did the office so kinda a different unique gift he is giving and decided on.I am sure he also took in consideration the time that goes into it and not to mention supplies.As I also mentioned(another post) maybe legally he can take it out of his practice.Cost not coming from his own pocket.I am sure that can be done.

LynnS

Talking about insurance reminds me it is time to renew mine.(OCTOBER)I better get on the stick.