Articles

4 Factors to Consider While Defining Your Wholesale Prices

by Eindia Wholesale Manufacturer | Wholesale - Indian Fashion | Tradit
A major challenge I encountered in the initial phase of my wholesale business is determining appropriate wholesale pricing. I guess this is one of the biggest issues that many artificial jewellery manufacturers deal with. Defining a pricing policy that is competitive and profitable is a little challenging task. However, there are a few factors that can help in coming to the right wholesale price. Different wholesalers have a different pricing approach. Though there is a common process that most suppliers stick to. If you are in a dilemma of how to price your wholesale items, then this blog would guide you.

Understanding how to extract the figures about wholesale costs and wholesale pricing:

Analyze Market Prices:

Before embarking on my wholesale journey, I personally met a plethora of suppliers and enquired about their jewellery items and selling prices. It is a rarest of a rare case that an item you intend to offer is not already existing in the market. Thus, do detailed research about the prevailing rates. Once I was done with the research part, I realized that my items were slightly different in terms of quality, appearance and characteristics than other players. But the difference did not qualify for ‘industry changing design’. There is no doubt my jewellery was unique, so, I marked my price a little high.

Garner Information about Material Costs:

Here, it is not about the overall material costs but it is about the cost per piece. It covers all costs in the preliminary and finishing stage. This implies that it covers every expense from the loose stones to the final production. In addition to this, consider the packing and shipping costs. It is basically the assembling costs that may vary from one wholesaler to another.

Determine Labour Cost:

This cost cannot be overlooked especially in the case of hand-made jewellery. How much it took to bring together various elements of jewellery? Suppose, a labourer can string small gems into three fashion necklaces in an hour at $30, then the cost per piece may come down to $10.

Indirect Costs:

These are primarily overhead costs that do not have direct involvement in product manufacturing. Indirect cost may include factory’s rent, electricity bills, promoting expenditure or even the expense of holding a formal meeting. Indirect costs can be ascertained by dividing the monthly indirect costs by the number of pieces produced. You need to record each and every expenditure in a journal book. After examining the costs, determine the amount to cover them up. It can be a huge business loss if one does not consider indirect expenses. Now, you can calculate the total cost by adding indirect and direct costs. So, the minimum selling price must meet at least your costs.

Profit Margin:

This is the basic purpose of running any business. It is a common practice on part of retailers to mark up their products by 100%. You must be well-acquainted with the general industry markup or markup relating to your product. Generally, the wholesalers offer their items at relatively lower prices and make a profit on bulk deals. At a point in time, if you think that the business is not doing great, you can make slight adjustments in the pricing policies.

Consider these factors before deciding on a price. Hope you found this information useful. In case of any query or assistance, feel free to connect with our leading artificial jewellery manufacturers.


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About Eindia Wholesale Freshman   Manufacturer | Wholesale - Indian Fashion | Tradit

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Joined APSense since, November 29th, 2018, From Jaipur, India.

Created on Jun 11th 2019 06:20. Viewed 449 times.

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