Wholesale!
Aislyn BryanShare
We had a question from a business customer about our prices and how we can just slash them in half for wholesale... and what does that say about our retail prices? After I answered, I realized all of our customers need those same answers, so here they are. After you read it, if you'd like to switch your account to wholesale, just fill out the form.
From the time we started this business, when sterling was $4 a troy ounce, until a few years ago when metals prices began climbing, our profit model was always the same: our cost to buy the materials and make the rings x 2. That gave us 50% profit to put back in the business, which is a healthy business model, and it worked well for us for all those years. We didn't have discounts then at all.
When metals costs began to climb and we had to adjust our prices accordingly, that 50% profit got bigger, too, and that's when we had the idea to begin offering discounts for quantity to make it easier for our business customers to get by without a wholesale option. So for years now, we've had quantity discounts: hit the first quantity and get 25% off, hit the second quantity and get 50% off. That 50% off was just a little bit over our cost with no profit to put back in the business, but working in higher quantities saves time and scrap, so it worked out and we were happy to be able give discounts for those bigger orders.
So for years now, that same 50% off we're offering through wholesale has been available as a quantity discount for ordering a certain number of rings at a time. That isn't new. What's new with wholesale is that we're now offering 50% off your whole order of rings, whether or not you hit the quantity minimums on individual ring sizes, as long as the order as a whole reaches a minimum of $500. If your orders are usually large, it's a good fit for you... but that same 50% discount has been available for years now, it was just ring size by ring size rather than off the order as a whole.
What's happening now is that precious metals prices are so high that almost the only people still buying precious metals are business people. Our original focus was hobbyists learning to make chainmaille, but people can't afford to learn on precious metals anymore. Our customers now are much fewer and almost all business people, for whom wholesale works better than ring size quantity discounts because you always get the best price, and only have a minimum to meet in the total. So we're switching our business model to wholesale in hopes of finding more jewelry business and bead shop people to make rings for.
Making such a big switch is scary but our original business model can't scale all the way up to current precious metals prices, so we're going all in. We're slashing our prices to the bone and taking no profit, in hopes we get enough orders from our business customers -- with extra breathing room from those no profit prices to maybe grow your own businesses -- plus new wholesale customers we hope to attract on Faire, to make the wholesale model viable for us.
It either will or it won't. We really hope it will... and we really hope you'll still be with us.
-- Aislyn
1 comment
You are wise to revise your practices as conditions arise that permit or require change. I am 83 years old and have managed several businesses over the years. My background involved a technology oriented undergrad program followed by a legal degree concentration on business and taxation.
I learned early on that creation of flexible policies which accommodated specific needs of individual employees, suppliers and customers, built lasting relationships that were designed in every case to create a partnership in interest, where both parties to every transaction was convinced that the transaction was mutually beneficial.
Over a period of sixty years, there were virtually no issues that resulted in a failed relationship.
Metalworking is my hobby in retirement. I sell everything I make, mostly through nonprofit craft organizations where I receive 50% of sales revenues and supply inventory strictly on consignment. I served as a director of the nonprofit and created a scholarship program for craft students who could not afford the classes offered. The organization has grown dramatically and its jewelry studio and workshop has recently been expanded nearly 100% with an expansion of class offerings for both beginners and professional artists.
I am committed to crafts and have encouraged two granddaughters to continue my work.
At this point, I am helping them to support their efforts by supplying rings and tools for their use. They are much more able to work with tight and complex weaves than am I since their fingers are not yet crippled by arthritis nor do they require magnifying glasses to pick up dropped rings.