wholesale pricing

This is a business question, not a printing question, but I figure a lot of you do this, so hopefully have some answers or suggestions. I’ve been asked a few times to quote on printing lines of greeting cards for other designers. Many ask for wholesale pricing. How do you vary your standard rates for something like this? Less markup? You still need to make some profit, I assume!

Thanks!

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People asking for wholesale pricing are usually try to get their job on the cheap. There is savings in volume, and I mean large volume, not just a single order. You have to be able to explain that there are certain costs in getting that first card printed, and the savings come by printing larger amounts that offset your expenses in the set-up. I have in the past offered savings on small orders by inviting the client to buy the paper and ink, it prevents one from collecting a mark-up on the materials, but keeps from having money tied-up in materials. It also invests the client in the process, and helps them to understand the outlay necessary to complete the job. Or, for larger amounts of product, you might create a sliding scale - a certain percentage off the second thousand, that increases along with the size of the order.

Paul

It’s called trade work you do it for less because you don’t have to deal with the end user. I mostly do trade work and add at least 30% if dealing with an end user. My clients add 10-? % to my prices because they have to deal with the end user.

wouldnt it be great if all printers agreed in a base price high enough so that we all have work, less work with higher profits?

Also known as collusion? :)

This is a business for some of us a hobby for others. If there is a demand for your work you will make money. If there is no demand then it’s a hobby.

10 % that is very cheap for the one that sells the job does he do that for a living?

Part of the “discount” tor trade work would be (in a commercial printing environment) is the % of commission that goes to the salesman which should be in throw selling price. Another element is the time savings of having the work submitted for production “ready to go”, after all time is money. On money the entity you ate doing the trade work for should have established credit and a steady stream of work. (Wearing my Standard Modern estimating hat)
Ted Lavin-Artificer Press

Another part of the discount of “trade work” is that the customer may be providing the plates and paper for you. So, sometimes it looks like you’re not charging much at all—but then you have no expenses but ink and labor and the capital cost of the equipment.

The catch in pricing this class of work is to make money for yourself, and leave enough margin for the customer to cover their expenses and make a profit. This can be hard to gauge some days and sometimes you win and sometimes you don’t get the job. Keeping copies of your quotes for work is good for building a sense of what a good price point is.

So far as card wholesale? Well, that’s more a matter of knowing your expenses, the profit margin required, and what the dealers/buyers will pay. Usually wholesaling a card line requires having a line of cards and marketing that catalog. Not for the lighthearted. A better starting point for such a venture might be Etsy or other digital storefront locations.

“Trade work” became a dirty word in our shop many years ago as the brokers who came to us would build an account sometimes over 5 years so you would trust them. Slap a job on you on account and ditch town or go bankrupt. I had one broker that loved to come in when all our presses were running, ask to use the phone and tell his client that he was at his shop. Any way, we do not do trade work. If another printer or broker wants our services they get the no tax discount and that’s all. But to answer the question 10-20% depending on the job was the going rate here.

I only do ‘trade work’ for other printers; everyone else? Retail.

But if you’re another printer- be it offset, silkscreen, letterpress, or otherwise- I provide services at a reduced rate. Especially if that printer provides inks, films, plates, paper, etc for the job, or does some of the makeready. I also don’t expect to speak with clients or communicate with them; only the other printer. 2 meetings: One to set the job up, the second an optional on-press meeting, and then the job gets picked up. I get paid when it leaves the shop. Those are my terms, but I charge 45% of the job for those terms.

I wouldn’t offer this rate to anyone under any other circumstances, nor would I ask for a rate like this under any other circumstances.

You can look at this two ways, price your work so that you make a profit.

Offer part of the profit (which is the discount) to ONLY retail stores that will give you return business.

Never offer a one time customer a discount.

I had a nice business card printing business with my brother. We had two prices, customers off the street and a price to other printers that brought me work every week.

If you want an on going business, you give the trade discount to retail stores that see more customer each day than you will, and can send you work weekly.

The discount is based on if you had a sales person selling for you and he/she worked only on a commission of the sale.

Aaron David
Good advice. Let somebody else do the sales if you want to spend more time in production.Too bad it’s not working for you.

I have done “special discounts” for several years with my offset press where the customer brings the plates and paper cut and i charge a “make ready” that has nothing to do with a percentage because its almost the same job to print 1 sheet or 5000 sheets after the 5000 i charge a second makeready and so on.
I havent done such work on letterpress but i think the logic would be the same you need to have abase so you dont work for free

Mike:

If not working for me, because my friends and family think I so be doing digital, not real printing.

Not that I know lots about it but I was always learned that retail work (that which you do for the end user) was 30% over cost and work for another printer or broker (trade work) was 10% over cost.

Usually the caveat is most don’t know their real total cost which would include your insurance, power, and all the other little things you never really think about.

Lammy…. a 10% margin “over cost” is a sure-fire way to wind up in the poor-house. The retail markup of 30% might be closer to right, depending on how you calculate the “costs”.

When I was doing work for customers, (both retail and trade work) I used the old formula of 4x material costs….. which is distributed like this:

25% went to direct material costs, ie paper, ink, plates, film, outside services that you purchase from vendors…. all of that.
25% went to LABOR (or into my pocket if I did the work myself… one has to eat, you know.)
25% went to OVERHEAD… ie: rent, lights, garbage pick up… whatever
and the final 25% was PROFIT to be reinvested back into better equipment, reserve fund, or my retirement account.

Calculated this way, the markup could be as high as 50% if you do the work yourself, or as low as 25% if you have an employee.

That was the pricing model, no matter who was buying or how much they were buying. The way I see it, if you do printing for the “trade” at 10% you are doing all of the work, and the other guy is making all of the profit. So he makes a 30% to 50% markup, while you just break even. It doesn’t seem like a good deal to me.

Nowadays, I don’t do any sort of “print-shop” work. (I’m retired) Instead I design and produce things like books, posters and so forth that I sell directly to my market….. at a much larger mark-up. BUT if I were to go back into running a shop, that’s the model I’d use.