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How to sell wholesale jewelry?

I collaborate with numerous handmade jewelry designers who are eager to showcase their products on their websites. However, I’ve noticed that only a small fraction of them engage in selling their jewelry wholesale to boutiques. This introductory 10-step guide aims to shed light on the significance of wholesale and provide insights on how designers can venture into this market.

Why Should I Wholesale My Jewelry?

Running a retail website demands a considerable advertising budget to drive traffic that converts into sales. Unless you’re proficient in marketing, you may find yourself investing significant time and resources in attracting visitors to your site. Additionally, maintaining good customer service, such as prompt email responses and accepting returns, can be time-consuming. Even if you excel at engaging potential customers on platforms like Facebook and Instagram, these channels often require payment to reach all your followers.

Wholesale offers a solution to many of these challenges and can bolster your retail sales. There are three primary reasons why wholesale is vital for your business.

Visibility: Have you ever stumbled upon a new brand that caught your eye while perusing a renowned retail store like Bloomingdale’s or Nordstrom? The same principle applies to your brand. By wholesaling to boutiques, you expose your products to customers who may not have encountered your brand before. Subsequently, when they seek out your designs in the future, they might discover your website through a Google search, resulting in increased retail sales.

Wider Distribution: This mirrors the strategy employed by larger companies like Ralph Lauren and Tory Burch, who distribute their products through major retailers while also maintaining their own online presence. By partnering with retailers, you extend the reach and audience for your products, tapping into diverse consumer demographics.

Credibility: According to Mei Pak, a respected designer and blogger and founder of Creative Hive Co., “When you delve into the wholesale business, you automatically gain instant credibility. Your peers, competitors, and current customers perceive you as a professional in the industry.” This enhanced credibility not only fosters repeat purchases from existing customers but also encourages new customers to trust your brand. Consequently, they are more inclined to make purchases directly from your website, bolstering your retail sales.

With wholesale pricing, the profit margin per sale may be lower. However, the larger order quantities offset this by allowing you to sell more products with less effort and at a reduced cost per unit. Additionally, wholesaling provides valuable insights into which products are popular, enabling you to focus production efforts on those in-demand items.

10 steps to get started…

Test it out

Before fully committing to wholesale, it’s wise to test the waters for interest. Here’s a plan to gauge interest:

  1. Craft Shows and Events: Set up a sign at your table indicating you accept wholesale orders. Note any responses and the questions you receive.
  2. Online Platforms: On Etsy or your website, include a link for wholesale inquiries or mention it in your product descriptions.
  3. Outreach to Boutiques: Identify 10 boutiques near you on Yelp that align with your product. Email them with a link to your products and inquire if they’re interested in stocking them.
  4. Responsive Communication: When approached by potential wholesale buyers, if you lack certain details, assure them you’ll follow up with more information.

Testing the waters in these ways can provide valuable insights into the potential success of your wholesale venture.

Legalities

Once you’ve made the decision to proceed, obtaining a business license and a seller’s permit are essential steps.

  1. Business License: This informs the government that you’re operating as a business entity. It’s necessary for tax purposes, allowing you to deduct business expenses when filing taxes. As a starting point, consider obtaining a sole proprietor license, which means you’ll file taxes as an individual. As a sole proprietor, you’re solely responsible for your business. For larger businesses, consulting a Certified Public Accountant (CPA) for guidance is advisable.
  2. Seller’s Permit: This permit is crucial for avoiding sales tax when purchasing supplies for making your products. Particularly in states with high sales tax rates like California (where sales tax can be as high as 10%), having a seller’s permit can result in significant savings. Additionally, wholesale suppliers typically require a seller’s permit to sell to you, as they only conduct business with licensed entities rather than individuals.

Both the business license and seller’s permit can be obtained through your city or state government office. Simply search online for “business license application [your city/state]” and “seller’s permit [your city/state]” to find the necessary information and application processes.

Wholesale Pricing

To determine your price, it’s essential to consider both material costs and labor costs. Many makers make the mistake of only factoring in material expenses. However, you must also include the cost of your time and expertise. As Katherine Swift of Resin Obsessions points out, if you were to pay someone else to create your pieces, the combination of material and labor costs would leave you with nothing.

To calculate your cost per piece, follow this formula:

Cost of materials + (Time to make each piece * Hourly labor rate)

For instance, if your materials cost $5 per piece, it takes 20 minutes to create each piece, and you aim to charge $60 per hour for your time, the cost per piece would be:

$5 + [(20/60) * $60] = $25

Typically, wholesale prices are double your cost. Therefore, in this example, the wholesale price would be:

$25 * 2 = $50

Note: Wholesale pricing often includes some fixed overhead costs such as office supplies and equipment. You can either estimate a small addition to the cost or absorb it within the margin.

The suggested retail price is usually double the wholesale price, so:

$50 * 2 = $100

However, it’s crucial to ensure your pricing is reasonable. Would you personally purchase your jewelry at the price you’ve determined? If not, you may need to reevaluate your pricing strategy or find ways to reduce costs.

Pricing is indeed complex, and there’s no one-size-fits-all approach. The key is to account for all material and labor expenses and ensure your pricing includes enough profit to make it worthwhile. For example, if the material cost was $50 instead of $5 in the above example, perhaps a 30% margin on wholesale would suffice, as long as it still results in a higher dollar profit compared to doubling the cost of the lower-priced product.

Terms

  1. Minimum Order: What is your minimum order quantity?
  2. Advance Payment: Do you require advance payment or deposits?
  3. Shipping Costs: How much does shipping cost?
  4. International Shipping: Do you ship internationally? If so, what are the associated costs and shipping times?
  5. Customization Options: Do you offer customization options for your products? If yes, what are the available options and any associated costs?
  6. Timeline for Delivery: What is your timeline for fulfilling orders? Do you deliver orders within a few days, similar to retail, or do you take wholesale orders for the next season with a longer lead time (e.g., 2-3 months)?
  7. Return Policies: What are your return policies? Do you accept returns or exchanges, and under what conditions?
  8. Defective Pieces: What if a piece is defective or damaged upon arrival? How do you handle such situations, and what is your process for replacements or refunds?

Considering and addressing these questions will help provide clarity and transparency to your potential customers, fostering trust and confidence in your business.

Product Photography

If you don’t plan to sell physically at trade shows, having high-quality product photography is essential for your website, wholesale marketplace listings, and potentially for catalogs. You have two options: either learn to DIY it or hire a professional photographer.

Packaging

At a minimum, it’s essential to have a tag on your product. This not only helps to brand yourself but also creates awareness about your business. Imagine purchasing something without any label or brand identity attached to it. To start, create a simple logo and have it printed on tags through an online printing service like Vistaprint or your local print shop.

As your business grows, consider investing in branded display cases to showcase your products. Offering these to stores that order a sufficient quantity can enhance your visibility within the boutique.

Create a wholesale order form

Creating a professional order form not only enhances your image but also helps you keep track of order details efficiently. You can easily design an order form using Microsoft Word or Google Docs. Make sure to include your policies on the order form so that store owners can easily reference them.

How to Begin Finding Retailers for Your Jewelry

One on One Pitches

Identify the stores where you envision your products selling and begin compiling a list of their names, websites, and contact information.

To research your market, you can use platforms like Yelp or conduct a Google search for “boutiques near me” to generate a list of potential stores to explore.

Review the websites of these stores to determine if your items align with their current offerings. If you don’t find anything similar to your jewelry in their inventory, consider reaching out to the store owner via email with information about your products. Be selective and only contact stores that are a good match for your jewelry to avoid coming across as spammy.

Customize your email to each store owner, referencing their collection and explaining why your products would complement their customer base.

While crafting these sales pitches may be time-consuming, your thoughtful approach increases the likelihood of receiving responses.

Since you’re doing the legwork yourself, you won’t incur any monthly fees, trade show expenses, or commissions.

Online Wholesale Marketplaces

Online wholesale marketplaces offer the advantage of reaching a broader range of stores, including those you may not have reached out to otherwise. While costs are lower compared to offline options like trade shows, there may be monthly fees and/or transaction fees involved. However, it’s low-risk since you can test it out for a few months with a small investment.

Many reputable marketplaces have an approval-only process, so it’s crucial to effectively sell yourself. Present a compelling brand story, highlight your design inspiration, and if your technique is unique, provide details on how your products are made.

Here are a few wholesale marketplaces tailored to the handmade/maker community:

  1. IndieMe.com (formerly wholesalecrafts.com): This platform has been established for a while. You must apply to sell with them, and for jewelry, they require that most pieces in your collection be priced at $80+ (wholesale price). If approved, you can list in their wholesale marketplace. Monthly fees start at $39, with a one-time setup fee of $150.
  2. Skue.co: Skue is a relatively new site that goes beyond just being a marketplace. They assist with your listings and present your line to retailers during their buy cycles. They offer an introductory pricing of $14 per month, which includes unlimited listings and guarantees feedback from retailers. Skue currently works with over 300 retailers and is growing rapidly. They are approval-only, and there is no commission on sales.
  3. Etsy Wholesale: There is no monthly fee for Etsy Wholesale, but they charge a 3.5% transaction fee on each order. They only allow vetted retailers to buy on the wholesale site, preventing consumers from purchasing at wholesale rates. It’s worth considering if you’re already successfully selling on Etsy.

Ensure you track your costs, sales volume, types of retailers ordering from you, payment patterns, and overall experience and customer support received from the marketplace. This data will help you evaluate the effectiveness of each platform for your business.

Trade Shows

Consider participating in a trade show once you’ve established yourself in the wholesale space. Traditional trade shows can be expensive, with costs including booth fees, travel, transporting merchandise, booth displays, and more.

When starting out, you can mitigate costs by partnering with other designers you know and sharing the expenses of a booth.

Here are some resources for more information:

10 Lessons from a First-Time Trade Show Exhibitor
Trade Show Directory(Note: This may not be a complete list but it’s a good start)
Participating in trade shows offers value beyond immediate orders. Even if retailers don’t place orders right away, you can gather leads and contacts that may convert into sales in the future. Many retailers collect information and place orders weeks after the show. Additionally, you’ll receive valuable feedback from prospective buyers.

As with any marketing effort, be sure to track your costs and evaluate the return on investment from participating in trade shows. This data will help inform your decision-making for future marketing strategies.

Managing a Wholesale Partnership

Getting your first big order is an exciting milestone, but now you need to execute it flawlessly and maintain a strong relationship with the retailer.

Execution: Ensure that your orders are fulfilled quickly and accurately. If it becomes too cumbersome for the store to work with you, they may seek alternatives. Getting Repeat Orders: After fulfilling the initial order, continue to stay in touch and nurture the relationship. Periodically email the retailer to request feedback on your product line, including what’s selling well and what isn’t. This feedback will inform your future designs. Follow up to secure repeat orders, but avoid overdoing it. A friendly message every now and then to showcase new designs will keep you on their radar. Professionalism: Maintain a professional demeanor throughout your interactions with the retailer. Respond promptly and courteously to emails, provide clear invoices, and ensure timely delivery of orders. If any issues arise with an order, address them promptly and effectively.

By consistently demonstrating professionalism and reliability, you’ll strengthen your relationship with the retailer and increase the likelihood of securing repeat orders.

Next Steps: Getting Ready for Growth

As your business grows, it’s essential to adapt your processes to manage increased workload and maintain balance in your life. Here are some considerations:

  1. Hiring a Virtual Assistant: A virtual assistant can help alleviate your workload by handling various online tasks remotely. They can assist with social media management, online research, customer service emails, and even personal tasks like event planning or finding a babysitter. Websites like Zirtual (for US-based part-time help) or Upwork (for global options at lower costs) can help you find suitable candidates.
  2. Hiring Your First Employee: When considering hiring your first employee, it’s crucial to ask yourself important questions to ensure it’s the right decision for your business. Or ask an experienced jewelry industry professional.
  3. Buying Supplies in Bulk: Purchasing materials in bulk can significantly reduce your costs. There are numerous online options like dgjewelry and FireMountain Gems. Additionally, consider collaborating with other sellers to buy supplies together, leveraging collective purchasing power for even better bulk pricing. Explore wholesale options to buy directly from overseas manufacturers for potentially greater cost savings.

By implementing these strategies, you can streamline your operations, reduce costs, and free up your time to focus on growing your business while maintaining a healthy work-life balance.

Summary

Selling your jewelry wholesale demands careful planning, dedication, and persistence. While many artists may feel uneasy about taking on a sales role, as the sole advocate of your brand, you must embrace it. You need to genuinely believe in your work and convey that passion to potential buyers. Discuss your techniques, the materials you use, and the inspiration behind your designs. Follow this up with impeccable execution and outstanding customer service. Continuously pitch your products and put yourself out there. With your determination and a solid strategy, your jewelry will find its way into the finest boutiques across the country.

More Jewelry info by Yotube:

How To Start A Jewelry Business With LITTLE MONEY

How To Start An Online Jewelry Business

Tips for Selling Handmade Jewelry Episode #7: Selling Jewelry Wholesale

How I Bring In $4.8 Million A Year Selling Jewelry In NYC | On The Side

HOW TO FIND A VENDOR FOR YOUR JEWELRY BUSINESS

More Jewelry info by Blog:

How do you source custom jewelry?

Top 5+ Tips for Assessing Jewelry Quality

Discovering the Cultural Legacy of Necklaces: A Comprehensive Guide

What is a jewelry wholesaler?



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