Production Processes

[pjmcla]

I agree totally with RonDon here on the fact that if the store owner wants to sell ( or not sell ) your product he can have a sizable influence.   I have seen baits placed I strategic places ( or almost hidden ) by shop owners.  Many shop owners are routinely asked "what are they biting".  They can give a totally honest answer that indicates some preference to one bait line vs another.       

[Frank]

Can you explain this formula a bit more and use some rough numbers to understand, i can kinda see where your going but not all the way...

Yes Lets say I want 10 cts to open a mold do that 100 times an hour, you get 10 dollars. So you can base your price that way and add the plastic to it. Does not sound like much but it adds up. Bagging takes longer than making the baits most of the time but I dont do much of that. On the stuff I sell to a shop that carries my stuff they get 40% and they sell the heck out of my baits. But I have been dealing with them for 14 yrs. The bill always gets paid and I keep them up to date on all the new things that come out. I dont tell them what colors to carry they tell me. This way they will sell it and promote it to the hilt. I have alot of reps getting baits from them too because they see the baits and ask if they can make it in there go to color of course they say yes and how many hundred do they want. 90% of the time they dont even blink an eye and just order. We talk about stagnet products all the time and discuss how to put product that sell in its place. I want my product to be say in short supply so it keeps the coming back. If you go in the store and look for my products the shelve always seem to be bare thus give the impression of  short supply. I make OK money on what I do alot more than 1dollar an hour but I dont bag like I said. Frank

[bribass]

Wow. That is generous!!! I work with LOTS of distributors and 10-20% is normal. One time i did 25%. 30-40% is wholesale pricing and I would only go there over 1000pcs.

Remember this, you can always start at 15% and they can say say 20%. If you give them 30%, you can never go back to 20%.

Also remember this, you are making a premium product so you cannot compare these to what Zoom or others margin on.

Bottom line is we give the shop owners something they can sell that others may not have. That brings in customers and they buy hooks and other stuff. That is worth a few % right there.

Jim

Holy CRAP!! 10-20?? When you say distributors you mean bait ships right?   

How do you get them to do 10 or 15%? I understand what you just said but that doesnt always work with people. I thought it was 35% minimum!

[ghostbaits]

Many of my distributors recommend 10-20%. They sell to the shops. The shoos I deal with directly do vary but 35% off the top for any business will mean out of business quick. With your other overhead, you have to be near 45% if profit going out the door, right off the top.

If you make big foot frogs, I will take 20 bags!!! Lol!!!

Jim

[procraftman]

I talked to a bait shop today, and they wanted 60%. My jaw almost cracked the concrete!    Needless to say I couldnt do that, but they were gracious enough to place some of my baits at the cash register and said they would help promote them.

[andrewlamberson]

Make sure you...and them...are talking the same language!  A "gross margin" of 40% is the same as a 66.7% markup !

Google "margin vs markup" for an explanation.

[floridagrimp]

this is a good link to this discussion (there are several)...markup v. margin chart at bottom.

ort=1" class="bbc_link" target="_blank">http://www.wikicfo.com/Wiki/Default.aspx?Page=Margin%20vs%20Markup&NS=&AspxAutoDetectCookieSupp ort=1