Lost my wholesale account, oh well.

[Vicki C]

I have been making soap for a local museum that is given away at the end of tours. The soap was sponsored by a member of the board of the museum. The price of the soap was low, $2 per bar (3 ounces), but I made 72 bars at a time, and I had finally figured out a system to streamline everything. Each bar was stamped and individually wrapped in paper, which was an effort. Well, I had told my contact that at some point I would need to raise the price - earlier this week she asked for more soap and told me to let her know about the new price. I responded with what I was thinking, $3 per bar, and she responded by saying they weren’t going to do the giveaway soap any longer, because the sponsor didn’t want to pay for it. (All by email.) I am not sure how I feel about this, but I guess I am disappointed. It was a lot of effort to get my process to a point where I could churn out 72 bars of high quality soap. I’m not sure if I should have just stuck with my original price. Maybe it was greedy to ask for more. I don’t know. I don’t really want to run a soap factory, either. Still stewing over it.

 

[AliOop]

Ugh, sorry to hear that. Honestly, though, that was a LOT of work for $2 per bar!

Could you have made the bars smaller and kept the price the same?

 

[Vicki C]

You know, that’s a good question. Maybe. They were in cavity molds, but maybe I could find smaller cavity molds. I don’t know though it has been kind of a hassle to be honest.

 

[AliOop]

Maybe a mix of relief and disappointment. I think I'd feel the same.

 

[dmcgee5034]

I’m sorry to hear this. What a disappointment, and after they asked you for more and for your new price? Ugh! I wouldn’t hesitate to get curious about why the change - was it the new price that really changed the decision?
It may be a bit of work on your end but here’s what came to my mind. Is the museum a member of the local Chamber of Commerce? I just ended my 2nd term on the CoC board here. I wonder if they would (or a member of their board) sponsor or co-sponsor your soap? They could have a little sign that says both your name and the sponsor name for the give away.
I hope it all works out with a good resolution for you….

 

[KiwiMoose]

Grrrr.
Ask yourself this - if you went back to them and suggested either a slightly smaller bar for the same price OR the same bar you are doing for, say, $2.40 per bar and they said YES! Would you be excited at the prospect of starting up the production line again? Or would you feel a bit stressed about it?
If the answer is that you would feel excited, then go ahead and pose the question - you have nothing to lose and everything to gain. But do it quickly in case they're off to find another supplier.

 

[Vicki C]

I’m sorry to hear this. What a disappointment, and after they asked you for more and for your new price? Ugh! I wouldn’t hesitate to get curious about why the change - was it the new price that really changed the decision?
It may be a bit of work on your end but here’s what came to my mind. Is the museum a member of the local Chamber of Commerce? I just ended my 2nd term on the CoC board here. I wonder if they would (or a member of their board) sponsor or co-sponsor your soap? They could have a little sign that says both your name and the sponsor name for the give away.
I hope it all works out with a good resolution for you….

The soap is paid for by an individual - I understand his hesitation. To complicate matters he had someone making smaller more rustic bars for 60¢ a bar - and my contact (the director) went to bat for me and wanted my soap. I am not sure if the other supplier has gone away. The CoC is a good suggestion but my town doesn’t have one. The museum is struggling financially - without support of the board they would go under.

Grrrr.
Ask yourself this - if you went back to them and suggested either a slightly smaller bar for the same price OR the same bar you are doing for, say, $2.40 per bar and they said YES! Would you be excited at the prospect of starting up the production line again? Or would you feel a bit stressed about it?
If the answer is that you would feel excited, then go ahead and pose the question - you have nothing to lose and everything to gain. But do it quickly in case they're off to find another supplier.

You know, I think I could make smaller bars and make it worth my while as @AliOop suggested. I’m looking in to smaller cavity molds. The advantage of this gig is that my company name is on every bar, and visitors come from everywhere - nationwide and international (Just ask @dibbles ! ) The exposure is nice, assuming they read the label. This summer has been such a learning curve for me. So many markets, plus this gig, plus soap challenges plus grandchild care, what’s a humble soapmaker to do.

 

[dibbles]

I'm sorry you lost the account. Only you can determine if the time/work involved is worth the money and exposure you get in return. Do you have any way of knowing how many people have actually ordered soap as a result of receiving a bar from the museum? Is your soap for sale at the gift shop? If it is, could you place small sample bars there that would have your information on it?

Smaller bars might be a solution - are you still in an open communication about this? Wrapping and labeling would take the same amount of time so I'd carefully weigh the pros and cons.

 

[Zany_in_CO]

I am not sure how I feel about this, but I guess I am disappointed.

Don't be. It's not really that big of a deal. 72 bars X $2 = $144 minus cost of ingredients, packaging, labor and time. I don't see a large profit margin there. You now have the experience. Focus on your profit margin and move on to a bigger and better return on your investment of time and money. You're worth it!!!

 

[KiwiMoose]

Maybe we're all a bit like musicians waiting to be discovered and hit the big time
I often drop a wee soap sample in to my stone sales or even used items sold on our eBay equivalent. People always comment how lovely it is to receive, but it's rare that I've got any extra customers out of it. My soap customers tend to be the same ol' coming back for more.
I had one account similar to yours Vicki that ordered off me wholesale to sell at their retail outlet (and it was wholesale proper - with a good profit margin for me). But eventually they found someone else who makes soap that is more rustic looking than mine, smaller and cheaper. I guess I could make similar, but it would not inspire me to create - which is the true joy I get out of soapmaking.

 

[glendam]

Your pricing sounds more than fair. I am surprised they gave away the soap (rather than selling it at their gift shop- perhaps they don’t have one?)
With the current economy, I could understand that being up to one individual to shoulder the bill (instead of being added to the entry fee to recoup costs), they may decide at any time to stop buying it. It is a shame though, but hopefully what you learned can be put to use in other wholesale accounts in the future.

 

[user 49910]

I don't know if you have a "marketing" sense or whatever, but a jump from $2 to $3 a bar is a 50% price increase. From that point of view, just about anyone would react in a negative way.
Think about it. What would your reaction be if the price of your soapmaking oils went up 50%, or the cost of laundry detergent or coffee? You would not be a happy camper.
I'm not trying to be negative, and don't take what I'm saying negatively I'm just stating the obvious. Perhaps, if there is a chance to salvage the situation is to raise the price in baby steps?

 

[Zany_in_CO]

It was a lot of effort to get my process to a point where I could churn out 72 bars of high quality soap.

As others have suggested, why not approach your contact with the idea of selling the bars in the Museum Gift Shop? Make sure they make a healthy profit, for example:
Wholesale cost to the gift shop = $2.50
Retail price to visitors = $5.00
You might want to redesign your label as a souvenir prominently featuring the Museum. ???

 

[Vicki C]

Some clarifications - these are soaps that they give away at the end of tours. They do have a gift shop and they buy other soap at wholesale from me. When we first made this arrangement I had asked for $3 a bar but eventually agreed to $2. I had told my contact that it wasnt sustainable, that I was going to have to ask for more .- agree that yes I should have probably made a smaller step.
But, I think we have a plan that might work, for smaller bars at the original price. Thanks for all your help!
PS I had my best market day ever today. So thrilled.

 

[Johnez]

I don't know if you have a "marketing" sense or whatever, but a jump from $2 to $3 a bar is a 50% price increase. From that point of view, just about anyone would react in a negative way.
Think about it. What would your reaction be if the price of your soapmaking oils went up 50%, or the cost of laundry detergent or coffee? You would not be a happy camper.
I'm not trying to be negative, and don't take what I'm saying negatively I'm just stating the obvious. Perhaps, if there is a chance to salvage the situation is to raise the price in baby steps?

To add to this might've been a good idea to employ a bit of shrinkflation, perhaps $2.35 for 2.75 oz.

Some clarifications - these are soaps that they give away at the end of tours. They do have a gift shop and they buy other soap at wholesale from me. When we first made this arrangement I had asked for $3 a bar but eventually agreed to $2. I had told my contact that it wasnt sustainable, that I was going to have to ask for more .- agree that yes I should have probably made a smaller step.
But, I think we have a plan that might work, for smaller bars at the original price. Thanks for all your help!
PS I had my best market day ever today. So thrilled.

Nice to see the rest of the story and to know you've still got a relationship going. All is not lost. Awesome bounce back at the market to boot!

 

[TheGecko]

Going from $2.00 to $3.00 is quite a jump when you think about it...that's a 50% increase in price. It seems that you understood the potential marketing value of having your soap in such an establishment which is why you agreed to the $2.00 in the first place. I would, if you can, try to negotiate a 50cent increase or make a 2oz for the same price. And FYI, I would have written off the discounted price as an advertising expense or a donation to the museum.

 

[math ace]

I say... Oh well too!
There can not be too much of a profit margin in the current contract. It takes a lot of time to package and label soap.

Their focus is price because they are giving it away. They aren't concerned about quality. They knew the $2 price was a short term deal... They got their deal and you got the exposure. Time to find another vendor.

It takes just as much time to label and package a smaller bar as a bigger bar. I wouldn't downsize..I would take .50 off the price if they were willing to go to cigar bands without wrapping or something similar that saves you labor. Honestly, though,. I think it is time to find another wholesaler that is more interested in your product.

 

[Vicki C]

I say... Oh well too!
There can not be too much of a profit margin in the current contract. It takes a lot of time to package and label soap.

Their focus is price because they are giving it away. They aren't concerned about quality. They knew the $2 price was a short term deal... They got their deal and you got the exposure. Time to find another vendor.

It takes just as much time to label and package a smaller bar as a bigger bar. I wouldn't downsize..I would take .50 off the price if they were willing to go to cigar bands without wrapping or something similar that saves you labor. Honestly, though,. I think it is time to find another wholesaler that is more interested in your product.

Yes - all this is true. And thank you all - as I mentioned I realize it was a large jump in price, yes, 50% increase, but it was always understood to be temporary at $2. As I said I think we have agreed on a solution.
On another note - I sold at a two day fall festival last weekend and surpassed my previous hing sales from the weekend before - things are moving! My limitation is time to do everything.
ETA - I had two women tell me that their daughters had said to them “Mom! The soap lady is here!”