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Commissioning rates (Read 1,515 times)
 
Lynn Woolever
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Commissioning rates
Dec 5th, 2014 at 7:47pm
 
I have built up a inventory of pens, bottle stoppers, ect. I was at a small flea market and asked about selling my turned item's. The proprietor requests a 25% commission. That seems high to me. I would have to raise the price to a point of being unsaleable. This is based on my not having to man a booth so is it out of reason? Any feedback is appreciated.

Lynn (aka Wooly)
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JimQuarles
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Re: Commissioning rates
Reply #1 - Dec 5th, 2014 at 8:02pm
 
25% isn't a bad rate.  I was asked for a 50% commission on pens on consignment.  I told him if he wanted to buy them I would give him 40%.
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Glenn Roberts
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Re: Commissioning rates
Reply #2 - Dec 5th, 2014 at 9:41pm
 
It doesn't matter. You need to receive x amount for your own reasons - cost of production + profit, or something else. As long as you receive your net compensation, the vendor can charge whatever commision they want. They are selling (or not selling) your stuff. Some people give their stuff away and make 0 dollars for their own reasons. If you are worried that the higher price of your stuff means it is unsaleable, that might mean you want market price. The vendor has to eat too, and the vendor has the realeastate.  A good quality vendor can be your friend, and help you sell your good quality "stuff", and both of you win.  Otherwise, you may have to develop an alternate plan. A good example of free markets at work.
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« Last Edit: Dec 5th, 2014 at 10:07pm by Glenn Roberts »  

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Ralph Fahringer
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Re: Commissioning rates
Reply #3 - Dec 6th, 2014 at 10:10am
 
25% is a good rate! The average in art galleries is 40% and some are trying for 50%.

You might want to rethink what your work is worth. Do you know for a fact that your work won't sell at a higher price or are you basing it on what YOU would be willing to pay?

Most budding artists are so unsure of their work that they assume no one would spend more than xxxx dollars for it and end up pricing well below what the market is willing to spend.

You need to let this person sell them for what you want plus the 25% and see how he  does.
If none sell, then you now have direct evidence of what your work is worth. On the other hand, if he sells out quickly, then you can raise the price on them.

If you want $15 for a piece, then 25% is only 3.75 more or $18.75. Now, do you really think your work can't absorb another $3.75?

Say you want $50 for it, then add on $12.50 and now it costs $62.50. Not alot more for someone willing to put out $50 for something.  At least for me, if I'm considering spending $50, $62.50 is in the same price range.

I guess the lesson here is... never assume what your customers will or will not spend.

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Ron Sardo
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Re: Commissioning rates
Reply #4 - Dec 6th, 2014 at 10:31am
 
I agree, 25% is better than good.

While I also agree with Ralph, his math is a little off  66.67 - 25% = 50.00

This is the way to figure a markup:

Start with 1.00 then minus percentage 0.25
1.00-0.25=0.75

Then take the price you need ($50) and use the following formula

50/0.75=66.667

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« Last Edit: Dec 6th, 2014 at 10:32am by Ron Sardo »  

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Rick Howard
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Re: Commissioning rates
Reply #5 - Dec 6th, 2014 at 11:08am
 
I'm confused.  How are you defining commission?  I hear commission and I think selling items on consignment.  Are you setting the price and selling them at his table then he takes a 25% cut?  Or are you wholesaling them to him?  I suppose either way it does not matter so long as you get the price your after.   

From a retailers stand point.  If I'm only making 25% margin on an item.  Its for one of two reasons.   I know I can sell them quick and sell a lot.  Or I have a surplus inventory and I want to invest that capital elsewhere. 

I would trust my vendor on this.  He knows his customers.  I got the price I want.  I suspect your vendor sees an opportunity to sell a lot of pens quickly. 
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Ralph Fahringer
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Re: Commissioning rates
Reply #6 - Dec 6th, 2014 at 11:56am
 
you're right Ron..

I went the other way and figured 25% of what you want versus 25% of the total price.

Let's go with your numbers.

Early morning math is not my best suit!! Smiley
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Bill Neff
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Re: Commissioning rates
Reply #7 - Dec 7th, 2014 at 4:05pm
 
A friend of mine who has a gallery (unfortunately they only do paintings) said the biggest mistake artists make when starting to sell their work is underpricing.  She said many buyers don't see a higher price as a negative if represents the work.
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Lynn Woolever
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Re: Commissioning rates
Reply #8 - Dec 7th, 2014 at 7:16pm
 
Rick Howard wrote on Dec 6th, 2014 at 11:08am:
I hear commission and I think selling items on consignment.  Are you setting the price and selling them at his table then he takes a 25% cut?

He was saying he would take 25% of the sale. If I want $40 for a gold Bolt Action pen with a exotic wood I would need to price it at $50.
I live in a rural farming/blue collar worker area. I don't have galleries to show and sell in. So I don't expect to sell my items for the high prices experienced in the metro area.
Perhaps I'm just selfish thinking he doesn't deserve 25% of my labor. Maybe I will just wait for church bazaar to sell them myself and help out the church as well.
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Don Stephan
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Re: Commissioning rates
Reply #9 - Dec 7th, 2014 at 7:48pm
 
Lynn:
A flea market is like any other business, with overhead (mortgage or rent, utilities, advertising, insurance, . . .) and profit that must be met.  Tell the vendor what you want for your items and see if he or she is still interested.  But yes, the vendor will want you to have the same pricing when you sell directly at yard sales, church bazaars, et cetera.  And if you want $40 and the vendor 25% commission, the item would be priced at $53.33 - if the vendor sells at $50 and takes 25% your remainder would be $50 - 12.50 = $37.50.
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Lynn Woolever
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Re: Commissioning rates
Reply #10 - Dec 7th, 2014 at 8:20pm
 
Don Stephan wrote on Dec 7th, 2014 at 7:48pm:
But yes, the vendor will want you to have the same pricing when you sell directly at yard sales, church bazaars, et cetera.

A good point I hadn't thought about. Some more thinking is required!  I am really looking to offset some of my expenses and get more toys, er, I mean tools. Tongue 
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After a good days work i used to stretch and it felt good!
These days it just hurts!
 
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Rick Howard
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Re: Commissioning rates
Reply #11 - Dec 10th, 2014 at 9:20pm
 
Lynn Woolever wrote on Dec 7th, 2014 at 8:20pm:
Don Stephan wrote on Dec 7th, 2014 at 7:48pm:
But yes, the vendor will want you to have the same pricing when you sell directly at yard sales, church bazaars, et cetera.

A good point I hadn't thought about. Some more thinking is required!  I am really looking to offset some of my expenses and get more toys, er, I mean tools. Tongue 


I think most of us are in that boat.  If I had to eat from my turning income... I'd starve  Cry

I can see the pickle you are in.  Pricing for a demographic is tough.  I don't think your being selfish.  However, he is not asking for 25% of your labor.  He's charging you for the space on his table at the market.

Are the customers likely to be the same people at the flea market as your other outlets?  I would easily say yes to his offer if he has a new customers.  If they are the same folks you can sell to already than its a no brainier.  IMHO.
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