I was curious as to how anyone out there has worked out selling cookies or other small items in another person's store, deli, coffee shop, etc...?
Do you have them sign an agreement as to who gets what profit per sale? Do you give them a cut of each sale of your item in their store for the ability to sell your item in their store?
I have no idea how one works this out when starting a small business. I would like to try to sell wrapped cookies and such in delis and other places locally but was not sure how to approach them and how anyone else has worked this out-how it is usually done? I have read books on starting a small business but never was able to find this out.
Thank you in advance!
What I do is offer them my products at 70% of their retail cost, as long as they order a minimum number each week or so.
I leave it up to them to determine the price at which they wish to sell the items...that's none of my business really!
I think your best bet is to sell your products wholesale. I have a small coffee shop/bakery and that is how I've always done it. I buy their products at a wholesale cost and then I can sell them for whatever price I chose. I sell my cakes to area restaurants wholesale also. This way you get paid up front and you don't have to worry about percentages of the sale, wait to get paid, etc.
I agree with Anonia74 about requiring a minimum order for the discount. I've learned this the hard way.
I hope this helps
Very true ge978!
Sell your product outright...not % per sale. Something important to consider are products that you've made, but don't get sold...or get damaged and therefore not sold. Why should you have done the labour & paid for ingredients...and have to write off stale/damaged/unsold/returned items? NO WAY! You'll never make a good profit.
It's up to the store to buy them from you and then do the work to sell them to clients at their set price.
A good idea for establishing your prices is to cost out all your ingredients...EVERTHING. From aluminmum foil to the tiny teaspoon of baking powder. Now find your price per unit (i.e. how much does ONE cookie or a slice of cake cost you?) Then add your labour/electricity/rent cost per batch...
Then multiply by at least 3 times that amount for your WHOLESALE price. Even better by 4 or 5 times to get a RETAIL price.
Swear to yourself that you WILL NOT go lower than 3 times that calculated production cost for sales and you will always make a reasonable profit.
Thank you both for your great advice and information on what you think is best! I agree that it seems best to sell the items for a price and then that way you are paid for the work you did. I have also heard before about multiplying by at least 3 times to get the selling price. I will work at finishing my figurings for the actual cost to make each cookie, etc... Great advice!!!! Thank you both so much.
You are inspirations for me as I am new to all of this and hope to be able to sell cookies for weddings, baby and bridal showers, at stores, etc... sometime this next year or two if I can find a kitchen to rent. We can't get a domestic kitchen license at our home because we own a cat.
Thanks again, Happy 2006!
I'm very happy to help. Good luck in your search to rent a kitchen. Maybe find a little shop that closes in the afternoon that you can rent afterhours or on weekends. If you have anymore questions please feel free to ask.
I also make and sell candy products. Many years ago I sold to a retail store. I was so insecure, I sold on consignment. That was, if some were stolen, or broken I didn't get the money. Now, they have to buy my produce outright! Lesson learned!
I've done it both ways. Orders placed by the bakery under $200 were 15% off of retail. I also did it on "consignment" and gave her 10% of the sale price which was my retail. It really worked out great.
Thank you everyone! It is great to hear what worked (and didn't work) for all of you. I would love to hear any more opinions also.
Good luck with all of your ventures and in the year ahead!