If you are lucky, you have a product that is evergreen — meaning it will sell on and on and on for you no matter what the season. But most of the time, this is not the case as trends come and go.
To have a truly successful business, you need to look at designing new products all the time. As a sales rep, the number one question I receive from buyers is ‘what is new?’ Which doesn’t mean they are not interested in reordering a proven product from last season, but means they are looking for something new and exciting to share with their customers.
I have always recommended that my producers come out with a new product twice a year: Once in the spring for tourist season and in the fall for the holiday season.
Visiting wholesale gift shows, especially those on the west or east coast is an excellent way to pick up on trends. In my case, often those trends take a few months to a few years to reach my home state of Idaho! HA! But I would come back home from the Seattle or Portland Gift Show with some great thoughts for new products for my vendor lines.
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Most successful artist increase their product line by 30% each year.
— Wendy Rosen
I bet you are gasping! 30% — Yup! That sounds right to me.
If you are really looking to build a strong business, products need to be rotated (for lack of a better word). Each year, slow moving items need to be closed out and new one lined up to replace them.
When we were heavily into gourmet food production, we would review our specialty food line every winter. We checked the sales stats at the end of the year to determine the following:
- How many of X item sold
- How many stores bought X item
- How many reorders we got for X item
Looking at those numbers helped us decide if we wanted to continue offering X item!
Then, of course, we (and you) should be adding new items to our line every spring and fall, so buyers have new products to offer their customers.
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Roughly expressed, the (pricing) formula goes like this:
Production Costs + Overhead Costs + Selling Costs + Profit = Wholesale Price
— Wendy Rosen
Excellent pricing formula!. And notice, at the end of the formula, she says WHOLESALE PRICE — not retail price.
Too many new producers get it wrong when they use this formula to develop their RETAIL price! Generally speaking, retail price is 2 – 2.5 times the wholesale price.
To explain in more detail, let’s define the different costs involved:
Productions costs include EVERYTHING needed to make a widget: Materials, shipping on material ordered, labor etc.
Overhead costs are rent, utilities etc. for the warehouse, building or room where production is done.
Selling Costs is often the category most producers leave out. Selling cost include show costs, transportation to shows, flyers etc. I also suggest producers add in another 15% rep commission amount — even if they don’t plan to hire a sales rep, a craftsman still needs compensation for their selling time.
Profit is usually a percentage of the cost, depending on the profit they wish to receive for their work.
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Marketing is the process of putting name, image, and product in front of the customer.
— Wendy Rosen
I use to think that sales and marketing were interchangeable terms. But marketing is so much more than sales.
Marketing starts with your image. Who are you and what audience are you appealing to? What do you want people to remember about your business? With that in mind, create a logo, font, or image to use on all your marketing materials.
So what are marketing materials? They consist of one or more of the following (not a conclusive list):
- Business cards
- Postcards
- Hangtags
- Special packaging
- Brochures
- Mailers
- Price sheets
- Show signage
- Website
- Email newsletter
- Artist bios
- Press kits
Having a cohesive presentation with any or all of the above is a good start on marketing your products.
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