Let's talk about let's talk about getting your wholesale pricing and your retail pricing and sink. What I talked about before is some of the definitions and I wanted to mention one here that you'll hear frequently it's called keystone and so to determine whether or not you're pricing will work well for wholesale you will set that retail price I'm sorry scratch that you will set your wholesale price the retailer will mark it up and they'll typically mark it up two times your wholesale price and that's what's called keystone ng so they'll double your wholesale price now some retailers in certain geographic areas where there there overhead is higher or they just have more expenses they will mark it up more than keystone but the industry standard and is typically well it's typically holds a keystone, so you double your wholesale price to get that retail price. Why is this important for you to know is important because you need that you won't tell them what to sell it for you don't really w...
ant to put msr pee in your catalog you don't really want to tell them because again one re retailer a may market up more than retailer b or vice versa, so if you're started tagging everything for retail pricing, they may have to re tagged things or change things so here's one example for necklaces to the just illustrates the keystone ing process so it is fifty dollars wholesale that she sells it for. And jenna determines this price. She knows her production costs, and she knows what the market will bear. She knows fifty dollars, right price for her wholesale piece. She knows that the retailer is going to keystone it to one hundred and that's the minimum amount that they're going to charge for it on bail cell in their store. And they may go higher than that. So wholesale needs to be your top priority. But here's how it correlates when you're selling retail, too. So she's going to sell it for fifty whole sam, they're going to keystone in the store. Two, one hundred now. Jenna never wants to undercut her retail hers. She wants to make wholesale her top priority. She wants to make sure that her stores are, um, you know, the first point of contact for these and consumers to buy her goods. So she's going to price it a little bit higher in her online shop to incentivize store. I'm sorry to invent incentivize the end consumer to go into the stores it general were to charge one hundred dollars it's still ok, but it's better to go a little higher. But if generated, charge ninety dollars for the same necklace that's undercutting the store. And so what's the incentive for these customers to go into the store, and that is a huge problem with newer companies that air starting out in the wholesale. I've heard from a lot of retailers recently, actually, that have said, you know, the these companies are selling me their products, but then they're selling them much lower on its ear in their own online shop and, you know, or and they're offering free shipping or something and it's just not making it easy for them to sell. So when you're selling wholesale, I want to go back to this one, you know, wholesale needs to be your top priority if this is what you're going to dio, you can still have your retail side of the business, but you really have to understand how the sales process works and how these numbers correlate so that you're not hurting relationships with your wholesale accounts on dh then, teo, I also wanted to mention that you'd really should be releasing new product to the wholesale market first before you put it in your online shop. I've also heard some gripes from retailers that have said, you know, oh, I you know, I didn't get the announcement about these new releases, but then I saw it on instagram, or I saw it on their online shop or you know, I saw another shop had it, and so you really want to make sure that these wholesale customers are your top priority, that they're getting first dibs on the the new things you're releasing and that you're just kind of you're making them feel like vips basically, so but this is this is a really important example that I want I want to hit home, you never, ever want to undercut. So when you're looking at your wholesale pricing, you know, consider if you are gonna continue retail channel that you're adjusting your prices accordingly on your website so that it is working for everybody. Yeah, um, I know it differs in the different industries I've heard, like two point five markup is normal for jewelry. So what? I want to have my bracing over two point five just to be safe, just in case they would like to mark it up that high if your industry standard is two point five to keystone, you mean so? I mean, so that's I mean, that's what I've heard, I don't know, okay, I'm not as familiar with the jewelry industry, so I would do your homework on that to definitely find out if because keystone in my not in my keystone and my understanding is the common thing, okay, from wholesale jumping in to retail. But if two point five is the norm for your industry than yeah, bump it up a little bit, and it doesn't have to be a lot. But you do want to make it easy for the buyers to buy, and you want to make them feel like they're getting royal treatment. You know that they're being put ahead of your online sales, and I mean, customers will still go to your site. They'll still go to you to buy, but it goes a long way in building that relationship with the retailers. And remember, we talked about in the last section, the last segment about, you know, building those relationships so that you have these same stores that you can go to over and over again and sell to cool. Thanks, yeah.
Katie Hunt is the founder of Proof to Product, a podcast host, business strategist and coach for product based business owners. Since 2011, Katie has helped thousands of brands get their products on the shelves of retail stores big & small. Her client’s products are sold in Target, Nordstroms, Container Store, Starbucks as well as independent boutiques around the world.
AMAZING, amazing course and fabulous instructor. Katie knows so much and does a fantastic job sharing specific, actionable insight in this course and the entire bundle. I can already tell that it's a resource I'll reference again and again as I grow my product line and I'm so happy I invested the time in it.
Katie is a very straight-forward and encouraging teacher. I was fortunate to be in the studio audience for this group of classes and have learned so much! I have had some help from friends in the industry on setting up wholesaling, however I was missing a set structure and strategy to get it off the ground professionally and timely. She makes the steps very clear, with ideas and references on how to do it or outsource what you need done. Katie ads her own experience to all of these steps, which is so helpful to hear. If you want clear, specific, strategic steps to take next to develop your own successful wholesale business, these are the classes! Katie is awesome! Thank you!!
I've taken 14 pages of notes with great guidelines and best practices for pricing, SKUS, releases and more. I'm feeling much more confident knowing the standards after taking this course. Katie is amazing!