Cat’s How To… sell your work through shops (and what’s in it for you)

Howkapow, selling tips, selling to retailers, sale or return, mark-up, designers makers

How to sell your work to a shop

When you sell your work to a shop, you’re embarking on a new relationship – so how do you get the best out of that retail-liason, and what exactly are you getting from it? Cat How stocks the work of many designers and makers in her super-cool design store HowkapowIn the last of Cat’s How To series, she explains how to choose which shops to work with, the advantages and risks of sale-or-return, and what shops do in return for their commission…

Shops and designer-makers should work in symbiotic harmony, where both parties are getting something good from the relationship. Both the designer and the shop owner should feel that they are benefitting positively from the partnership – the worst is someone on either side feeling they are being short changed.

As a designer-maker selling your work on to shops, always make sure you are happy with what they are offering you. Make concessions if you feel it is worth it, but be wary of entering into exploitative arrangements like working for free. You don’t want to come out of an arrangement out of pocket.

 

What is Sale Or Return?

Selling on a sale-or-return basis can be worthwhile if you have excess stock and you can afford to have your work in a shop because it can potentially garner you more exposure, but make sure you keep good records and have a written contract with the shop beforehand which makes them liable for any damage done to your work. I had a horrible experience when I lent my handmade jewellery to a shop on sale-or-return and they damaged pieces on a fashion show they hadn’t asked my permission for, and then left many of my pieces out in the shop window which subsequently got damaged by the sun. Despite having a written contract with them, I only managed to get £5 out of them even though they ruined over £70 worth of stock. So my advice would be to make sure you cover yourself wherever possible.

Some shops might want to try out a few pieces on sale-or-return to start off with, and then proceed to buying wholesale later on once they have figured out what sells to their customers. Bear in mind that your commission for sale-or-return (say 60% to you and 40% to the shop) will probably change to a less favourable one for you, say a 2.4 mark-up (see my previous post about pricing), once they buy wholesale from you. This takes into account the fact that the shop is taking a risk and buying things from you outright which they might or might not go on to sell. You will have the cash and be footloose and fancy free, but the shop might end up with dead stock that they have to discount instead of simply returning to you.

howkapowoffice

 

What’s in a mark-up?

Most shops that are VAT registered will buy products from a designer-maker outright at a 2.4 mark-up. Briefly, this is taking your given wholesale price (say £10), doubling it to get their mark-up of £10 (to get £20), and then adding 20% VAT on top to get a retail price of £24. For a retailer to get the same cut as you can seem a little extreme. However, there are lots of hidden costs a retailer has to factor in which eat into their £10 fee.

Overheads

Firstly there are the overheads of running a shop, studio or warehouse. These will include heating and electricity, phone and internet fees, rent and business rates which are calculated per square foot and so this factors in the space needed to hold stock, as well as staff costs. With staff, you not only have to factor in pay, but other things that make their working day a little more pleasurable: tea, coffee, milk and sugar, and (in our case) LOTS of biscuits, as well as things like cleaning products and toilet roll. It ain’t all glam!

 

Packaging

Your products will also have to be wrapped and packaged and, if the shop is selling your work online, also sent by post. Packaging will include boxes, bubble wrap, tissue paper, ribbon, stickers and postage fees. At Howkapow we include little details with every order – a hand-written note, packing slip and gift card, all wrapped up in our branded tissue paper and stickers. This all costs money. Other retailers have asked us why we spend cash on these seemingly pointless and expensive extras, but we will never stop doing this because we think it makes our designers’ products look that little bit more lovely! We also buy in branded jewellery boxes with our logo embossed on the front, which we use to send out all our designers’ jewellery. This again is an extra cost, but it makes the package a lot more special for a customer and helps to present a designers’ work in the best possible light which we believe is paramount.

 

Admin & logistics

On top of all this is the brain power involved in working out the logistics of sending out stock. At Howkapow, Rog (my husband and business partner) has near-on weekly meetings with courier companies and Royal Mail to try to get the best possible rates and services and keep on top of new systems for processing orders.

 

Advertising

Another outlay, especially for online shops, is paying to get traffic to the shop website. This could be through Google ads (which all have to be designed in-house), as well as Facebook advertising and paying monthly subscription fees for newsletters.

 

PR & Marketing

Getting press coverage for your products can be another expense for shops. At Howkapow, we believe very strongly in press and marketing and have a dedicated PR person in every day to handle all our press enquiries and help promote our products to local, national and international press. They write press releases, come up with campaigns and manage press list, as well as product loans and photo shoots. This also costs money, and all our designers get press for their work paid for by us simply for having their products in our shop.

 

So it all adds up. The best thing to do is to be selective over where and who you want to sell your work and not just go for anyone. Scope out a shop’s social media – have they got a large following and will this mean your work will get more exposure? Do they feel like good and decent people who will want to promote your work for you as much as you feel you deserve.

Cat x

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Cat How studied English Literature at Bristol University and Communication Design at Central Saint Martins College. She worked as a professional journalist and graphic designer, but made jewellery as a hobby and sold it at artist markets on the weekends when she lived in Melbourne and London. In December 2010 Cat set up Howkapow with her husband, Roger How. Howkapow is a colourful design shop which supports and promotes the work of independent designers and illustrators. Follow @howkapow on Twitter. 

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3 Comments

  • April 9, 2014

    Hazel Mansfield

    Hi
    What a great Post.

    One thing though, which I was hoping you might have included, is how much a designer-maker might be looking to make over a period, perhaps measured in percentage or proportion of price of product, so that the designer-maker can work out a career path.
    Is there an acknowledged pathway, that you know of?

    Thanks.
    Regards
    Hazel.
    HebTweed, Hebrides Harris Tweed

  • April 11, 2014

    Suzen Woods

    Hi Camilla, Very informative post !

    As you have listed in your post that one of the best way to get traffic on online shops is google ads and facebook posts, but I don’t know really it will be done ? I am little bit confused to make my brand awareness in people, can you please suggest me some ideas ?

    Suzen Woods,
    Majestical Jewels

  • April 21, 2014

    Mecki

    Thanks Cat for a most informative post. I have always thought that shops need to make a good profit on the products they sell but you have certainly made me aware that as makers we have to look beyond the commission when deciding which retailers to work with. Mecki :)