Thinking about going Wholesale? Read this :-)

[Erruk]

Hello, I have been a silent member of these forums for quite some time, recently registered and finally decided to start getting involved some.

I have been in the craft business ever since I was born (no kidding). My mother ran craft shops and did crafts herself for my entire life. So no doubt I got into it at the age of 14, I helped make her wood products. By the age of 18 I was doing candles retail in her shops and some shows.

My mother finally closed all her shops and went full wholesale when I was 19. Of course I went too, going from retail to wholesale is very hard, a lot of things are different.

I personally do just about everything, Pillars, votive, clam shells, jar candles, etc. Now that I am wholesale I will never go back, here's why:

1 - I love dealing with only one person, not literally, because I deal with dozens of people any given week. But I deal with just one shop to sell however many candles they order, and no one else. I sell to shop number 2 however many candles and no one else, etc. I'm sure a lot of people LOVE dealing with the customers, I did too. But I never knew how much I would love dealing with just one person, and having them deal with the customers till it was happening.

2 - I LOVE how, when I do a wholesale show, people RUN to my booth pushing trash cans (no kidding) and other giant carts and wagons, and grabbing 10 or 20 of just one type of item. I love having no ONE persons bill being under 100$, none of these people are buying for themselves, they are buying for a profit! No one is going to JUST spend 20$ (unless they are small! but very few small shops sell candles, its a very big expense to most shops)

3- I mainly do wholesale shows, there are tons of shows around the united states, and I do about 1 a month. I love working for a month straight to have a "payout" at the end! it makes all the hard work worth that much more!

4- I love having just ONE JOB! When I was retail I worked the business PLUS a full time job. Why? I had a ton of overhead! and if I didn't sell x amount, I didn't eat for a month! You never know exactly how much retail people are going to buy, but wholesale is so much more guaranteed, how so? well because after a few years you can get wholesale accounts, people who just call up and say I need x of this and y of that, charge my card on file etc. My wholesale accounts ALONE pay all my monthly house bills and food etc, so what does that mean? Basically, my wholesale shows pay for my business, and anything "fun" I want to do, whenever I have time (which is never)

Those sound fun? You might want to do wholesale! BUT! keep some things in mind!

You have to be ready for people to haggle you for better prices, its the name of the game, and do not get upset. I have a list on my computer of all the different shops who get different prices! some pay more then others, and god help me if another one finds out! Its just how it works, keep this in mind when pricing, and do not JUMP and say yes if someone offers a lower price. Most of the time I make it clear that the only way they are getting this lower price is if they make x amount order each month, with a minimum of x a year or they lose the price.

You have to be able to handle people make what I call rude remarks! You will not imagine the amount of shows I go to where I have this new item and bring 100's of them, sell out of them within the first hour (I always keep one on hand to show people what it looked like so they can order), and then have 5 people walk by and say "oh well, that looks easy to do we can make those ourselves" I usually encourage this! why? because no one in their right mind would do what we candle makers do! (I said goodbye to my sense of smell years ago)

PRICING! this is the big one, and sadly this is the one where most people will fail in this business. I am a workaholic, I get it from both my parents who worked 16 hour days almost my entire life. I also do not buy 10 of something and say wonder how these will do? So what you say? well, if you buy 10, and I buy 150, or even 1500, I bet I can haggle for a very nice price break. A wholesale business takes about 5x as much money to start as just starting a candle business, and you all know how much that costs!

I am sure most of you do this as more then a hobby, a few posts lately I can tell a lot of you are also very much workaholics. So back to pricing. I sell my candles cheap, I do not double my price on most of them. I also have my cost figured down to a tenth of one penny. So I know exactly how much profit I make on every single thing I do.

I will give you an example in a votive. I buy my wax from candles and supplies. Why? because I live close to them, so shipping costs me no more then the tank to drive there with a trailer attached. I know of a few more places that are much much cheaper, but! the quantity needed is a minimum of a cargo container (no kidding) or a trailer load. I do own a warehouse, but not big enough for 16 skids! (or however many skids a trailer carries) I buy enough wax to make the cost of pouring 8 votive less then 2$ including scent, wax, color, and even packaging. I use a very similar packing method to one I saw on here a few weeks ago with 12 votive candles in a pack. Okay, so for 8 votive candles its around 2$ ( don't want to get too technical with the exact amount, just making it easy) So for a pack of 12 thats roughly 3$ cost. I sell a pack of 12 candles for $6. and to most of my steady buyers, they get them for as low as $5. a pack. I run many many melting pots, each with their own color and scent already added, and most are 10 pound pots. So what does that mean? It means I can pour 100's of these things in a matter of minutes. I did the numbers once but it was something like, from nothing to 100% done, packaged and labeled (excluding the time to cool) I could do 500 in one hour, those are very rough numbers without actually finding the papers where I worked this out, but it gives you a rough idea of pricing. I try to make the majority of my money on quantity bought, and not an individual item. Some of you might say I don't want to sell a votive for 50cents! or less! but, if you can make 100's in an hour, why charge more? its better to make sure your shops are making money, at the same time they are selling tons, and in the end making you more money. The more money your shops make, the more money you make, its that simple.

I do a lot of other items that go well with candles that I do not touch, as what most people call "staples" such as candle holders, lights, and silicone light bulbs.

One big thing is, and I know a lot of you might be upset about this one... But you need to choose your best scents and stick with just them. I have 5 scents, that's it! You may be thinking OH MY only 5!? Think of it like this, a small store wants to carry your line of candles. I'll give mine as an example, I have an 8oz jar candle, 12oz by request, and 16oz candle, votives and 3x3 3x6 and 3x9 pillars and clam shells. No store is going to be able to carry all of those in all 50 candle scents you have! now, 5 scents they will, and it will give people a nice price range of items to carry in their shops. I do carry a few extra scents during different types of the year, like gingerbread close to fall, and toasted marshmallow(c&s brand) in fall and spring etc. PLUS this means you can get more done of each type of item, for example I always try to bring 48 of each pillar (pillars are not my best seller) of each scent to every show, which is easy only having 5 scents!

I am sure I missed a lot of things, but ask questions I will try to answer most of them. I know a lot of you have given out a ton of information about suppliers etc, but I cannot afford to lose all of mine so that is one aspect I cannot answer. Don't hesitate to ask there is some stuff I will share tho!

ALSO! in wholesale, you you are quarter year faster then the rest of the population! What does that mean? well, Winter items sell best in fall, summer items sell best in spring, and spring items sell best in winter! heh, one thing to keep in mind!

That is why I love wholesale, Also I do not have a website, I wish I did but I just cannot get myself to make one! even though tons of people ask me about it!

Thanks for reading, or not, too long I know! I tried to keep it short.

[Candybee]

Thanks for your input on wholesale. I found it interesting. I have been selling to small shops off and on for the past 2-3 years and have personal experience that they just don't make you the money you need to stay in this biz.

People always suggest why don't you sell to this shop or that shop your candles would be perfect there! Often times it may be true but then I think about all the work and small profit I would make and its just not always worth it. Thats why I just stick to a few shops at a time.

I have been thinking of doing some wholesale shows but not sure whats available in my area. Other vendors I know do the usual craft shows and not wholesale so they don't know. Any insight to finding these type shows would be helpful to me.

[Erruk]

That all depends on your area really. If you know someone around you who sells wholesale try to find out where they sell. Candle suppliers in your area might even be able to help you, the more you sell the more wax etc you buy from them so most of the time they will help you too. If you search, tradeshow, cash and carry, order writing show, wholesale in your area see what comes up.

One thing about doing shows that turns people away is almost all the shows I do the booth rent is $1,000. If you want electricity extension, that's usually another 50-100$. That seems like a lot I know, but I never bring less then 10,000 worth of product to a show unless its in walking distance lol.

Also, one thing you could do, which seems kind of mean. Is sell in retail shops and retail shows at less then retail prices. It gives you an advantage over other people price wise. People love a good deal when they see one. When I was shutting down my retail side I did one last show and did blowout prices (more then my wholesale prices though) and people were swarming the booth I couldn't even keep up I had to call for backup heh.

[JacquiO]

Thanks Erruk! Great first post! It was very insightful and I've really been wanting to start something wholesale. My question is how do you find out about these wholesale expos? Also about how much does the space usually run you to attend these shows?

Edited April 3, 2010 by JacquiO

[Candybee]

Yeah the booth fee is up there but I know you can make that and a whole lot more if you have a good day. I did find some within driving distance in the PA area. Will check those out. The most I have ever taken to a show is $6-8k worth so I have a good idea of how much I need to make.

I agree having too many scents can kill you. I was thinking about just a few scents but changing out for each season unless I want to keep my year round sellers. I have a couple of those.

I noticed on some of the applications they want copies of your prices, selling terms, shipping, etc. to show you are ready to wholesale and have your policies in place along with photos of products, booth, and product brochure or flyer. One mentioned they will send out notices to your customers if you send them a list.

Do you ever do the order shows? Do you just take samples to these and take orders only. Thats what it sounds like. Not sure if that would be the route I want to take.

[country bee]

Lots of info here,thanks.I too have thinking about it and started making a plan.

[Erruk]

I noticed on some of the applications they want copies of your prices, selling terms, shipping, etc. to show you are ready to wholesale and have your policies in place along with photos of products, booth, and product brochure or flyer. One mentioned they will send out notices to your customers if you send them a list.

Do you ever do the order shows? Do you just take samples to these and take orders only. Thats what it sounds like. Not sure if that would be the route I want to take.

Yes, that is one downside about the wholesale business, it is a good thing I got into it as early as I did. There is a lot of people already out there in the candle business doing wholesale, and most shows will not accept 2 of the exact same thing to one show. It is very important that if you are doing this you have something special and new to add, not just a candle in a jar. If I get a chance I will add a pic of one of my jar candles to give an idea of what I mean by different.

About order taking shows, I have not personally done those, mainly because I hate shipping. If someone makes a big enough order I usually delivery it myself. Order taking shows you would just take about 2 or 3 of each of your items to show people what they look like and the consistency of each item, or even how each item is unique in its own way etc.

If you do not mind packing and shipping then Order taking might be the BEST route. I turn down a lot of sales in shows because they live in CA or somewhere out West and want it shipped. Plus, you can take a small van and do not have to worry about selling out. The only bad side is you have to be a lot more professional. Business cards need to be very unique, and its always best to have a very nice setup that is very eye catching.

A very unique idea for business cards is put your business name on a pack of matches. Its useful, and unique. Make sample packs, 2 of each scent of each candle for this price to try it out in your store etc. NEVER give free samples. If you feel the NEED to do a free sample don't give more then, for example, one or two bricks of a break away clam shell tart, or even a simple tea light.

Also to the person above you, prices for booths are very hard to tell. There are so many different shows with different prices. Most of the shows I do, the booth is going to cost me roughly $1,000. This sometimes includes hotel room cost. The booths are 10x10, and some are just 4x10.

[nursenancy]

Thanks for some great info!

A very unique idea for business cards is put your business name on a pack of matches

I do this, and people really like it! I actually put a scaled down version of my business card on a box of stick matches. I buy them at the dollar store - 10 for a buck and give them away with each sale.

[Kitn]

Interesting post, thank you.

[chrisinpa]

Nice post with many thought provoking points.

Do you have a shop that you store your supplies and pour or are you able to store all supplies at your home? Reason I'm asking is that would be an added cost. I'm not sure if I would be able to store so much at my home.

The biggest question for you.

How on earth did you pick the 5 scents you carry?

[Erruk]

Nice post with many thought provoking points.

Do you have a shop that you store your supplies and pour or are you able to store all supplies at your home? Reason I'm asking is that would be an added cost. I'm not sure if I would be able to store so much at my home.

The biggest question for you.

How on earth did you pick the 5 scents you carry?

I do have a warehouse and a place to store items when they are ready, it is about 3500 sq foot and costs (roughly with elec water trash etc) 1200 a month. I do not rent it alone which is the best part, I get half, so my cost is only 600 a month for a very large space (at least for making candles).

The way I picked my five scents, was kind of easy actually. When I did retail I had 20 scents, and I would bring about 10 of those home with only selling a small handful. The other 10 I would nearly sell out, and at least 3 of them I would have people asking for more (Like I said, I never sell 100% out, I always keep at least 1 of each product for customers to see what I had, even in retail I did this). Strangely enough, it was almost always the same 3!

Also, I kept tons, and tons of paper work. I knew in a years time exactly how many of what scent I sold. I was able to tell after a year that I sold a total of 100's more of about 4 scents then I did of any others. So it was really easy for me to just pick those 4, then I threw in one other that was my personal fav (which was still a good seller) and went with that. I do like I said carry some christmas scents and some summer scents, like watermelon and for Winter I carry a Pine, so at any ONE time I will have at least 6, except for fall, I never sold any type of Pumpkin etc very well so fall is the only time where I only have 5 scents, the Most I have is Winter with 7 scents.

[BeckyW]

I enjoyed reading about your wholesale business. I have done wholesale for over 3 years. It is bigger than my retail business by far. I agree with you on how much easier it is to do wholesale than retail although as you mention the cost involved is a lot heftier. I am the opposite of you when it comes to how many scents I offer mainly because I could never just have 5 scents. But I think it is great you are able to just have 5 (to 7) and be as successful as you are. I do know I need to downsize as I have many that are not popular or not ordered as often.

I do have a website that I do myself (as I do hosting on the side), and do not do shows.

Thank you for sharing your information as I think people need to be aware what wholesale can lead to. I hope to have the space you do one day-as that would be wonderful!

Thanks again for sharing.

[mm123]

Excellent topic, Erruk! I'm enjoying keeping up with this thread.

May I ask how you set up to efficiently pour large volumes of candles? Specifically the ones that aren't container candles, like the pillars and votives.

If you can pour hundreds in a hour, do you keep over a hundred molds on hand? Do you use wick pins or have a better, faster way of wicking? Thanks!

[Candybee]

If I were doing that many votives I would not use wick pins. I would use centering wicks as you can just drop them into the mold and they center themselves. Easy peasy!

[Erruk]

If I were doing that many votives I would not use wick pins. I would use centering wicks as you can just drop them into the mold and they center themselves. Easy peasy!

Have to make a fast post on the run... Basically what she said lol. I cannot pour 100's of pillars in an hour, too expensive to have that many molds in my opinion unless they are a really good seller, which they are not for me so I only can do about 12 of those at a time. But like I mentioned before I carry very few of them to a show. I was actually trying to decide if I was going to carry votives or pillars anymore. Jar candles are my best sellers, and those you can make very fast.

[Dusty]

Thanks for posting - and letting us in on your business ideas:yay:

[mm123]

Can you produce this volume of candles pouring with pitchers or have you tried a wax dispenser?

[Erruk]

Can you produce this volume of candles pouring with pitchers or have you tried a wax dispenser?

Wax dispensers are to me a very, assembly line type of a purchase. I do not want to do that, I like being able to tell people my stuff is hand made and made in the USA. I have signs saying that in my booths. I pour with pitches with a glove on to hold the bottom as I do so (No drips or spillage) The thing that makes me pour "fast" is not having to mix each individual pour pot, I mix all my ingredients into a 10 pound melting pot that I turn to pouring temperatures before I mix the scent color etc in. If I know I will need more than 10 pounds I will use more than one pot. I just make sure I clean it well if I change scents later.