Any advice on Consignments and stores selling your work?

PapaDuke · Post by **PapaDuke** » Thu Oct 05, 2006 12:42 am

I recently sold one of my Tampers to a guy in Israel who turns out to
be the owner of what he says is the largest Pipe & Tobacco Store over
there. Here's his website if you can read Hebrew: http://www.pipeandtea.co.il

He wrote me today and wants to start selling my tampers out of his store but hasn't reveled HOW he wants to do that. Of course there is no way that I'm mailing off a dozen or more tampers just on an electronic handshake and a prayer that everythign works out.

Does anyone have any dealings or knowledge with how a pipe or tamper
maker can get his items in a store to be sold and most of all how not
to get taken? What's the common rule to this? I don't mind stores
that are here on the coast doing a consignment but then how much is a
fair mark-up for them to sell your product at?

I'm new to anything like this so any help from some of you old pros
would be very helpful!
Thanks

ToddJohnson · Post by **ToddJohnson** » Thu Oct 05, 2006 9:45 am

Consignment is just always a bad idea, especially if you're dealing with up front costs like overseas shipping. If someone likes your work enough to carry it (and you're willing to wholesale), you should offer it to him at 50-55% of retail and he should pay for it up front. This is called keystone, and is basically the industry standard with most goods. The mark-up is 100%.

Todd

TreverT · Post by **TreverT** » Thu Oct 05, 2006 10:17 am

I think I know the guy you are talking about, and if so, he is a good guy. That said, consignment is virtually always a recipe for disaster. If a store really wants to profit from your work, they should pay for it up front. I've heard no end of horror stories from people who've sent whole boxes of tampers or pipes here or there, and never been paid. Amazing how the enthusiastic biz owners who were so interested can suddenly become so totally unreachable... not returning calls, emails, etc. Here be sharks, swim at your own risk. A bit of easy investigation in the various online pipe forum archives can easily turn up some lists of places you DON'T want to do business with, as well as places you do.

LexKY_Pipe · Post by **LexKY_Pipe** » Thu Oct 05, 2006 10:39 am

This is wise advice.

Tano · Post by **Tano** » Thu Oct 05, 2006 11:28 pm

Hi Papa Duke
Its very common for retailers to list a product at triple keystone. This gives them the leeway to still make a profit should they decide to put it on sale at an attractive discount. First you have to establish what your tampers can bare to be sold by a retailer. For example if the public will readily pay say $50, the retailer might ask around $75. so that if he gives a 25% discount at clearence time he will still make his profit. Your selling price to him would be $25.
Does this help?
This is why we have so many small craft businesses bypassing the retailer, allowing the small guy to offer and affordable product and still make a profit.
Tano

ArtGuy · Post by **ArtGuy** » Fri Oct 06, 2006 11:07 am

I would suggest telling the retailer what your retail price is, offer them at 55% of that per piece and state the minimum number of pieces they need to buy. I would also get your money up front. Not so much to protect yourself from being cheated but merely to have the retailer assume the risk if they do not sell. They then have reason to promote and sell the work as they have money invested in it.

That being said, I have done consignment with a small B&M here in lafayette where they took 15% of the sale. However, I made certain I could still sell those very same pipes on my site without giving a comission and that I could come in and pick up the pipes at any time. I no longer do that as thankfully I do not have extra inventory sitting around like I used to. I would not do a consignment overseas or anywhere where I could not come in and take the pipes if needed.

ToddJohnson · Post by **ToddJohnson** » Fri Oct 06, 2006 3:20 pm

Tano wrote:Hi Papa Duke
Its very common for retailers to list a product at triple keystone. This gives them the leeway to still make a profit should they decide to put it on sale at an attractive discount. First you have to establish what your tampers can bare to be sold by a retailer. For example if the public will readily pay say $50, the retailer might ask around $75. so that if he gives a 25% discount at clearence time he will still make his profit. Your selling price to him would be $25.
Does this help?
This is why we have so many small craft businesses bypassing the retailer, allowing the small guy to offer and affordable product and still make a profit.
Tano

That's an interesting point of view, but it isn't very common in the pipe world--at least not for limited-production hand made goods. Triple keystone may be well and good for shoes, or even pipecleaners, but the last thing you want is a sign on your work that says "SUNDAY, SUNDAY, SUNDAY, WE'RE DROPPING PRICES AND BLOWING 'EM OUT THE DOOR. ALL ACME TAMPERS ARE ON SUPER CLEARANCE." It doesn't exactly help to build quality brand identity or establish value across a line of production.

Todd

Tano · Post by **Tano** » Sat Oct 07, 2006 12:54 am

I agree but, but once you sell your goods, the retailer can price them at whatever price he feels they will sell. If the product moves, then there is no problem. However if it doesn't he can always lower the price (discount) to get rid of the stock, and not order again. No retailer wants to invest money unless they can make a profit, and eliminate break even situations.
Tano

RadDavis · Post by **RadDavis** » Sat Oct 07, 2006 1:04 pm

I think most, if not all, retailers in the pipes and tobacco business will buy at wholesale and sell at the makers suggested retail price.

That is, if they expect to do repeat business with the maker.

I know that I wouldn't be too happy with a retailer that tripled wholesale prices and then gave the impression that he couldn't sell my pipes without offering a large discount. I would feel the same about a dealer that only took a 10% markup, and undercut my own prices.

They would not be buying any more pipes from me.

Rad