# wholesale vs large orders



## a4patch (Oct 7, 2009)

The girls at my bank would like to place a large order. They would pool the orders of all the girls into one. One person would collect the money and distribute the soap. They would email me the order. I would drive 2 minutes over there and get one payment.

They want to know what I would charge for a whole batch of one scent? Angel scent (which is the walmart- /minus-GM +with aloe juice instead) 187 oz of fats. about 44 ....4.5-5 oz bars 

I see that Vicki (please don't be offended- I check three girls regularly on here) has this posted on her website.

DISCOUNT SOAP: Purchase 10+ bars (mix and match) and the price drops to $4.00.
WHOLESALE SOAP: Purchase 36 bars (mix and match) and the price drops to $3.50
UNWRAPPED BARS: Purchase 10+ bars (mix and match) and the price drops to $3.50. Purchase 36 bars (mix and match) and the price drops to $3.00.

should there be a large difference in discount and wholesale prices?
I would like to offer unwrapped bars sold to one person with one payment (one check or cash). Will I be shooting myself in the foot later? Yes, PJ I read your post also. Should I think this through better?

I would also like to sell a whole batch to someone. (who may resell it or give it as gifts)


Thanks.

Do you see any problems following this plan?


----------



## Kalne (Oct 25, 2007)

Everyone will give you a different answer on this I'm sure. LOL 

I don't give anyone my wholesale price unless they are actually going to resell it.

I don't offer a discount for unwrapped bars because honestly, I may have all the bars of what they are wanting already wrapped! Now if/when I get larger, this might change.

I do offer a discount to someone ordering their own batch made. They get it unwrapped and uncured. But that still comes out a tad more than my wholesale price.

And I usually offer a discount for multiple bar purchases. Last year was $4.50 per bar or 5 for $20. This year it's $5 per bar or 5 for $22.

I don't publish my wholesale price. As a shopper I don't like knowing how cheap a product can be bought. Makes me feel like I'm really over paying when I only want/need a few items. If I see I can get something for half price by buying a quantity much larger than I can use I will usually look elsewhere for a better price regular price. That's just one of *my* quirks though. LOL


----------



## NubianSoaps.com (Oct 26, 2007)

Nobody can tell you how to do your business discounts, but your price point has to be attractive...you make some, the store makes some, or they won't buy from you for very long. This was the hardest part for me because nobody uses the same recipe, alot don't charge for labor, so your comparing apples and oranges.

For me, and all the prices above are up 50 cents with full retail now $6., pulling soap off the cure rack and putting it into a box that holds 36 bars, or the large flat rate box which holds 50...I don't have to clean up, fix edges, sit down and put in bags, then box, then take it down and pull them out  shoot that is so much labor saved, I love selling naked bars! Once your selling alot of soap and having to soap at least a few batches every day, how can you not have all your soap on cure racks at least once in the 2 or 3 week cure time? I not only now soap this much, but I also put soap into boxes unwrapped to resell as naked soaps. So each of my scents has boxes of wrapped soap and boxes of naked soaps in storage.

Yes these gals would get a wholesale price, I have several folks who do this, either they purchase all their soap one time for the year, or they get together with their friends or coworkers, for me it's not about resale it's about making the soap attractive to resale if they choose to. 

Someone wanting to buy a whole batch is special order, because I already have 36 or 50 wrapped or unwrapped bars ready and waiting....or they have some part of a cure wait which I tell them upfront......so for me it would be someone waning a scent and then not wanting it colored or maybe no goat milk in it, or a new scent, this last week it was someone wanting the bars cut in half  anything special you don't get wholesale prices for it, you pay special order for it, less than full retail but not by much. Extra work, which includes anything I don't do normally, because it takes you out of your comfort zone, you get extra labor for. Including delievering soap 

My prices came from a gal who I hired to work out my costs including labor...the increase in price is due to the fact I am going to now take a salary, not just be paid labor. It's semantics but I tend to put labor back into the soap business, with it an actual salary I am hoping it will make me feel differently. Vicki


----------



## a4patch (Oct 7, 2009)

I have an excel spread sheet. I cannot get it to upload.


----------



## Terri-Lynn (Nov 7, 2007)

I have people order a full log of one scent occasionally and it sells for close to what my wholesale is...but I am not cutting or wrapping. I ask for lead time on this and I just set an uncut log away for them. Honestly cutting wouldn't be a big issue for me but I think they feel like they are getting a real deal with that big ol' log. In your situation I would offer a little deal but not wholesale. BTW sometimes in this situation offering a bonus rather than a discount is cheaper for you like x number of sample sized bars or lip balms for the number of people in the buying group. I never put my soap "on sale" at markets but I sometimes offer a bonus of some sort to move things along.


----------



## a4patch (Oct 7, 2009)

Thank you so much for your help. Could you let me know if you think I am headed in right direction?


I uploaded my cost calculator and deleted any packaging costs. I am not sure if I left something out I should have considered.

Vicki, do you like the prices you have now on your website or would like to make changes in price or #counts.


----------



## a4patch (Oct 7, 2009)

so sorry....I forgot the link.http://spreadsheets.google.com/ccc?key=0Ak19R8HKUnR-dFFDVUJOcHZVcnB0VXU2WncyRjc1Y2c&hl=en

This is a google doc. no password needed if you click from the link provided.


----------



## NubianSoaps.com (Oct 26, 2007)

My prices on my website are not corrected yet, the prices are all up by 50 cents except retail which is up $1, per bar, increases in USPS.com also with the large flat rate box shipping for $13.95 now etc.... I also have new bars to put up and for retail orders, a cart. I am not going to have wholesale even working on my website, I like the personal email or phone call instead and it is working for me.

I like your spread sheet, it shows you really quickly how using expensive oils or butters hurts your bottom line, and $10 worth of fragrance in one batch, you can have this cost in a few high end bars, but you can't sustain that, why you go with bulk orders from manufactures and not resellers. In reality when purchasing from most of the names listed on this forum of who everyone is buying scent from all the time you are paying 100% over their costs. 

With the coconut oil in your recipe why are you using castor?
Why not use the Pomace or sunflower or soybean oil rather than olive?
Sam's costs are also driving to and from and your yearly membership?
It takes 1 hour of labor billed at $10 per batch of soap? Not that it takes you an hour to soap, but also cutting and wrapping and ordering?
Electricity, internet, insurance, (clothes, gloves, scale, shoes, stick blender, microwave, utensils, water, cleaning fluids, molds, shipping of products to you, driving to pick up products (milage plus your time).....why having a dedicated check book that pays for everything with your paypal going in and out of it so you can really keep track of what you are actually spending. Yes alot of this is prorated over it's lifetime of your soap company etc.

And oddly the more you purchase in bulk the less your cost per bar of raw products becomes, and the more you sell and the bigger you get the more the cost per bar of miscellaneous increases 

Try replacing a few things at a time with wholesale purchases. Your packaging? Your top selling fragrances? Vicki


----------



## a4patch (Oct 7, 2009)

Thank you. I cannot take credit for the chart. I copied it from a soap file and then got my sister to make formula and content changes to it for me. 

I need to read over your post again in the AM. It is so full of information. 

I did change the markup percentage (tap the price for wholesale/retail and the formula will pop up. ) the wholesale was set default at %150 of cost and I changed it to %200 of costs and the retail is at %400 of costs. If you tap any cell you can see the formula. I can not write the formulas, but I am a cut and paste queen. This does add in my hour of time and the doubled/ 4X cost price. 

I do want to reduce my costs and will look at this hard. I do not have a figure in the chart for the milk. I am paying $8 a gallon for frozen milk. I need to figure this cost/driving/time into the calculator. 

One of the things I would like to do is the 36 bar mix and match. I could call it U-36. U mix and match. U collect $ U list the naked bars wanted. email me and U pick up or I ship at the current shipping rate.


----------



## NubianSoaps.com (Oct 26, 2007)

Get the 3 flat rate boxes, small, medium and large USPS.com flat rate boxes, they will ship them to you. See how many of your bars fit into them, and make your cutoff for that number. Mine are 3, 36 and 50. I charge the full dollar above actual shipping. I do 99% of my shipping on USPS.com getting my boxes here for free and also the carrier pickup or free when I have more boxes than I have mailbox space which is at least every Monday and Tuesday. When doing ads on facebook and places like that getting 3 big 6 ounce bars shipped to anywhere in the US for $20 is a bargain, they get to use my soap, and also send a quick gift for $20. Vicki


----------



## a4patch (Oct 7, 2009)

http://spreadsheets.google.com/ccc?key=0Ak19R8HKUnR-dDdVeTA5NnliWHF3WUR6MDhuY0xmbGc&hl=en

here is the spread shee that made me come to my senses about subbing lard for shea.


----------



## a4patch (Oct 7, 2009)

Back to the original question. I took a basket of each soap over there on Monday. Now it is Thursday and I have a 20 bar order (first hyper link) from the bank tellers. I was pleased with this. I will do something to encourage the sale of naked bars bought in bulk. I am not sure what...yet.

In the spread sheet I see that I missed some stuff...like the GM! But I did add in hours for some of my labor and added the 200% wholesale markup and the 400% wholesale mark up. Each time I work with the spreadsheet I see someone new viewing it on google. They show up as anonymous. It sure helped me to see the calculator.


----------



## Huminbird (Jul 22, 2008)

I used this spreadsheet and is it a little bit off on the markup? If you are paying yourself for the work you put into it, why add such a high markup? You have already payed yourself for the work you put into the soap...at least some of the work. Where would the money from the markup go?

I admit that my business sense may be a little off. I work as a soaper so I can have a job at home where I can take care of my son. My calculations that I have done on my own show me making a profit that goes right back into building a business. Honestly I rarely pay myself at this point. I will pay back the original investment into the business soon but is it wrong not to take any money for the work I have put in yet? I thought it was normal to not see a profit for the first couple of years. At this point the business is paying for itself and I am able to get better equipment and such with the extra.


----------



## a4patch (Oct 7, 2009)

There are things that need to be added. GM is one of them since my GM is purchased at $8 a gallon. 

Then Vicki listed a bunch of stuff I did not even think of.
"cutting and wrapping and ordering?
Electricity, internet, insurance, (clothes, gloves, scale, shoes, stick blender, microwave, utensils, water, cleaning fluids, molds, shipping of products to you, driving to pick up products (milage plus your time)....."

My bars are cut at 5 oz and shrink to abut 4.7 oz. I think an average price I see is $1 per oz or better. So, my mark up does not even reflect this. I guess this is why I have posted this information. I need to know what I am doing and need help.


----------



## jimandpj (Mar 11, 2008)

Becky - If you want your business to grow, you have got to have a markup. A growing business sucks cash like you would not believe. If you do not have a markup, you won't be making any money for a VERY long time.

PJ


----------



## Huminbird (Jul 22, 2008)

I realize there needs to be a markup but I was wondering if 200% was a little high or normal. My business doesn't make money for me right now but it is making enough money to grow so that next year I believe I will be making a decent profit. 

It costs me between .50 and .75 per bar in raw materials. I figure the cost doubles when you consider paying me for my labor. x3 when you think about all the misc things that go into it including phone bill, electricity etc. I know that is a pretty rough equation but I know the cost of raw materials for sure. Then I add $.50/bar for wholesale price and come out to $2.75. Does this sound like to "unscientific" of a way to decide my wholesale price? 

Using the excel spreadsheet I am adding almost $1/bar to my wholesale price but of course that doesn't take into account random costs. I really should figure out how to use some accounting software. Any suggestions for a good one? Good but simple?

My bars used to cost less but I have started to use more EOs and that adds quite a bit of cost to each bar.

Editing to apologize for the thread hijack.


----------



## jimandpj (Mar 11, 2008)

Becky, let me put it this way, you will always be spending more money than you can forecast. And it adds up. So the question is, how do you feel about raising your prices? If you don't like the idea, then set your prices higher than you think you need to now, b/c I'm telling you it's amazing how much money you spend when your business is growing. If Vicki, with all her economies of scale and her existing setup is raising her prices to $3.50, that should tell you something.

And your labor - are you including time spent reordering, cleaning, answering customer questions, planning, etc... Most people way undercharge their labor.

Original question - I don't give a discount for a large group order - I give the person organizing some free soap.

PJ


----------



## a4patch (Oct 7, 2009)

PJ
Are you getting rid of you $5 each or 5 for $20?


----------



## jimandpj (Mar 11, 2008)

Oh yeah...

We did away with the 5 for $20 over 6 months ago.

In 2010 we switched to $6 each or 4 for $20 at shows. Nobody batted an eye lash. In fact, people are handing over $20's much faster.

Our new website went live last night!!! Yeah! We'll be raising prices on the website in the next month or so, once I introduce the new essential oil soaps. We'll be going to a graduated scale on the website. Purity soaps will stay at $5 and Essential Oil Soaps will probably be at $6.50 with the other soaps ranging in between.

I've said it before, I never believed we could be making this kind of money, but I also never believed we'd be spending this kind of money. We still battle the cash flow monster every month. Which is just crazy to me. I never understood before why growing businesses failed, and it is b/c a growing business just sucks cash. So yes, we're raising prices - we've got to.

We have people in our area who have seen our success and are copying us - down to the look, packaging, and yes, even plagiarizing my site. They're also undercutting my prices significantly. They're not hurting my business and there is no way they can sustain any kind of growth at those prices. 

Goat milk soap is a premium product - there's no way we should be charging less than other handmade soaps that just use water. But you've got to believe in your product and believe that people will spend good money for it. And I can guarantee you, they will. Once your soap starts helping their dry skin and eczema, you've got a customer for life.

Sorry for the rambling, I'm on about 4 hours of sleep. 
PJ


----------



## a4patch (Oct 7, 2009)

love the cat video!

The site is great. The bomb. I like both of them. both sites had nice clean looks. I like the white back ground. your pictures are bright also. so many are cluttered with flowers and props. I like it better with just the soap= just the facts... I am waiting on the newsletter to see what your special will be.


----------



## jimandpj (Mar 11, 2008)

Thanks, Peggy.

I really liked the old site, but we simply outgrew it. The shopping cart was not robust enough to do what I needed. Plus we were starting to have too many problems with paypal. We still take paypal, but we can now process credit cards directly on our site as well. I've got so many photos I have to take. It's driving me crazy the way the soaps aren't all at the same angle. But I wanted to get it live before I fixed the photos. LOL

I've done a lot of research on prices lately, on an ounce per ounce basis, we're one of the cheapest soaps out there. Which is insane especially when you're comparing it to soaps made with water. If your business is based on being the cheapest soap out there, it's doomed. There will always be someone willing to undercut you. I will never charge people an unreasonable amount of money, b/c that's just not who we are or what we are about. But the minute your volume outgrows what you can produce in your kitchen, the costs go up SO much.

We're trying to figure out what the newsletter special will be - haven't decided yet. This will probably be the last month with a newsletter special. After this we're going to a points reward system. Haven't figured out the details of that either yet. LOL The never ending to-do list. 

PJ


----------



## Kalne (Oct 25, 2007)

I love your new site! Did you do it yourselves? 

I have to say you have been such an inspiration to me. We have ten kids, nine at home ranging from 25 to 3. The oldest at home is our 'farm manager'. She's always been our animal lover and oversees everything with the goat herd. She does it all and has 4 of her siblings doing all the animal work from milking to cleaning out the barns. I rarely step in the barn! I have 1 dd in particular who attends almost all my markets and shows with me. She's a huge help with setting up and getting things to look nice. The other kids take turns coming with me. And the younger kids help with just wrapping and packing and inventory for now and barn chores. But they also pick up the slack with other chores freeing me and the olders up when we really need it. I love the way you've included your kids in your public profile. That's something I haven't really done and should.


----------



## a4patch (Oct 7, 2009)

Bath bomb, bath bomb bath bomb. 

went back and looked for the crooked bars of soap. I never noticed the first time through. I am not sure how you have the backgrounds so white in the pictures, but it is very appealing. 
Just noticed the screen printed muslin bags also...very nice.


----------



## jimandpj (Mar 11, 2008)

Kathy - Thanks, no way did I do that myself. My programming skills are not up to that level. I paid big bucks for that website. LOL Half to a designer and half to a programmer. It's been in the works for over 6 months. I'd love to have professional photographs taken, but no money for that right now. My boys have always done most of the goat work, but since Jim's been home full time it's been amazing. I'm the one that says when it is time to do what, and poof! it's done.  The children have always gone everywhere I've gone and been a part of what I've done, so it was natural to include them. Plus, they are just natural sales people. They're really good. And they're good b/c it's something they make, use, and believe in.

Peggy Sue - Brett's been making the bath bombs. She's finally gotten really good at it. Boy, was it a big learning curve though - yikes!! Everyone has been loving them, so that's good for her too. 

Our success has been very inspirational. It really has. I had prayed for many years for a family business. I never once thought soap - even though I'd been making it for us. I really believe it has been such a success because it was God's perfect timing. Without that, Jim and I would be working nonstop and not having anywhere near the success we've had.

We've also had "luck" with the media - just on a local basis, but it's really helped. Not so much with sales (although there have been some), but with our reputation and our ability to represent ourselves. The children and I have all gotten very comfortable being interviewed and speaking live on tv. Emery is actually the one who has been interviewed the most.  We haven't sought any of it out, we're just out there in the public all the time and they find us.

Back to the $ topic, I was thinking after my last post, that one of our biggest expenses is advertising. But not the way you think - our biggest advertising dollars comes from giving out free soap. We give out LOTS and LOTS. You never know who it's going to reach and what will come of it. We just recently met the President of the Kentucky Broadcaster's Association at a birthday party. Didn't go there planning on doing any business. But the talk turned to what we did and the next thing you know I was sending Fletcher to the car to go get some soap. Nothing has come of it, but you never know. 

I've said it many times, if you want to have a successful soap business, you're going to have to become a good business person that just happens to make good soap.

Wow, definitely rambling - need to get some sleep! 

PJ


----------



## a4patch (Oct 7, 2009)

I removed this spreadsheet from google docs.


----------

