Since opening Firain in September 2017, quite a number of friends have asked me about the nitty gritty of setting up a small creative business and how to wholesale the things they make. I was interviewed about wholesale for Josephine Brooks’ podcast On the Make, but there is still so much that I don’t know about from this side of the table as an online shop owner.
A woman who does know the ins and outs of wholesale - and other ways of selling your products - is Therese Ørtenblad who runs her own consultancy Small Business Collaborative. She is one of the most approachable experts and I’m so excited that she is sharing her knowledge on the Firain journal. If you have a question that I didn’t ask Therese, please do ask it in the comments and we will do our best to answer!
Where is home for you at the moment? What do you love about living there?
West London, Isleworth to be precise, technically it doesn’t even have a London postcode but I still say West London when asked. We moved here two and half years ago from a tiny flat in Brook Green (near Olympia, also in West London) because I wanted a garden and more space so that we could get a dog.
I love our garden, I love growing things and getting the BBQ out as often as I can and that on sunny days I can move my office outside and my dog Milo can sunbathe in the grass.
You've had such a wide range of work experience - could you describe your highs and lows so far?
I loved something about all my jobs but I think that my second job in the industry was the one that made me feel super lucky, although, that also meant I always felt like an imposter and I worked crazy hours and left after 11 months. It was for a publishing company in Bath and I got to go there every other week and stay in a nice hotel which in the beginning felt like such a privilege but later felt really lonely which is why I left so quickly.
My lows must be to have been made redundant, it was at a small company that I really loved working for, I had invested so much of myself into this role, taken a huge pay drop because I really wanted to work for that business and in the end it didn’t work and it did make me feel like I failed. I’m an overachiever and have never been fired or let go from any job so this was very new to me and it also came at the worst time as my husband was made redundant a month later.
So many people are setting up small businesses at the moment. We are definitely a nation of shopkeepers! Inexperience can lead to making rooky mistakes when setting up a new enterprise. Which common pitfalls do you see over and over again, and what advice would you give to a new business owner to avoid them?
My absolute top tip is do your market research and really get to know your customer, this will help you with everything, marketing, copywriting, website, seo, buying, product development and of course wholesale.
One of the most common pitfalls I see is that we put all our efforts into getting that first sale to a customer, don’t do any follow up and then wonder why we’re not getting any re-orders. It’s much easier to get a second sale from someone than constantly finding new customers, so nurture those relationships any way you can.
When money is very tight setting up a business, what should we focus on, and what can wait for later?
Money makers, it’s great to have the most beautiful website, the most perfect branding, everything in bespoke packaging etc. but in the end of the day you will only be able to afford those things if you make sure that you make money that you can use to invest in all those things.
In the beginning you will have to think, will this make a customer more likely to buy? Will this make me money? Before you invest in something. For example, having great product packaging will likely help sell your product in a brick and mortar store but if you’re selling online only to start off with something a little less costly might do.
We all want our businesses to be popular and profitable overnight, but are there any advantages to growing slowly? How can we use quiet times to develop our work?
I am a firm believer in growing at a pace that suits you and your business and not to compare yourself to other people. Growing slowly will often mean that you really get to know your customer, you can take the time to build a loyal following that will recommend you to their friends and family.
A small business is much more flexible, and you can try new things much easier and without a big financial commitment. Get feedback from those loyal customers and really see what works for you and your business. Invite your customers to be part of your journey and develop/select products you think they will love.
I love ordering from smaller businesses, particularly if I’m ordering a gift for a friend that will be delivered straight to them as a lot of small businesses take time to package things with care and you can’t get the same ordering from the high-street. This is something I know you do so well Jo, it’s such a treat to receive a delivery from you.
At quiet times, create content to delight your customers and nurture those relationships, if you’re selling to shops, then research new shops to target and take the time to get to know them a little before you approach them.
Could you describe the way a typical wholesale relationship works?
A good relationship is always a two-way street. The supplier needs to keep the stockist up to date with any new product releases, any discontinued lines and if anything is selling particularly well. In an ideal world the stockist would let the supplier know if any lines are flying off the shelves or if they are not working as well as they would have anticipated and let them know if they decide to change direction.
I think it’s nice if the supplier keeps in touch every now and then to get feedback on how the range is doing and it’s nice if the stockist takes the time to reply.
In reality, more and more suppliers are moving online, and orders are placed online, confirmed and shipped automatically and in-person communication only happens when sales are down or when something has gone wrong. I think this is a little sad and think that we should never underestimate getting to know each-other and working together, it makes it so much more fun and enjoyable.
Are there any other retail models a supplier might want to consider?
When you’re starting out as a small supplier you will be asked about Sale or Return, commission, drop-shipping and all these has their own place and can be an option for your business.
Sale or Return – a form of wholesale where the stockist has the option to return unsold stock after a set time period against a credit.
Commission – the stockist will pay the supplier minus a pre-agreed percentage when they sell an item.
Drop-shipping – the stockist take the order but the supplier ships it, there’s less risk involved for the stockist as they don’t have to hold the stock.
The idea of selling products on a wholesale basis can seem a daunting prospect for creative business owners. What advantages are there to working in this way?
When you sell wholesale, you will receive bigger orders, you can sell things in pack sizes and set a minimum order which you can’t do in retail. You are also more likely to get re-orders for the same products than when you sell retail and stockists often stay loyal as long as you keep bringing new products out and they sell in their stores.
As your order volumes goes up you are likely to be able to improve your buy in quantities and therefore your margins so it’s a great way to scale your business to a size that suits you.
Are there any disadvantages to the supplier?
When you sell wholesale, you will be giving away a lot of your margin to the retailer so if you handmake your product and it takes you hours and hours to make a wholesale model might not be right for you. However, perhaps you can still be stocked in a few independent stores on a commission basis.
Selling handmade products is a notoriously tough market. What can a maker do to ensure their pricing is correct?
Do your market research, you don’t have to be the cheapest but if you’re not you need to know what makes your product more expensive. It’s not so much about the price but in the perceived value. You are not likely to be able to compete on price so the story and values you convey are much more important. Really get to know your customer and market yourself to them.
So many of the shop owners you interview for your blog say that they find potential new suppliers on Instagram. What can a maker do to ensure their instagram - and other social media platforms - stand out from the crowd?
I think Instagram is fantastic but don’t rely solely on suppliers finding you, you can also find them. Have a look at the hashtags they use and follow and comment on
shops you think would sell your things well. Get to know them, feature them in #followfriday posts and then get in touch to introduce yourself. Also, make it clear on your profile that you are open for wholesale and perhaps regularly give your stockists shout-outs.
Finally...do you have a motto or a phrase you like to live by?
Be kind, kindness is good for your soul. Be persistent, if it doesn’t work the first time, try and try again.
Therese offers four different ways to work with her: Bespoke 1:1 Mentoring; 2-Hour "Fika" Mastermind; Email/Catalogue Audit and 12-week Group Training. Click here to read more about these services. To read a Mini Story about Firain on Therese’s website, click here.