Sales Channels for Your Silk Scarves - Part 1

There are three basic ways of selling.

• consignment sales (today's post)
• retail sale/direct sale
• wholesale

Each of those sales is right for a specific situation.

• The volume you can produce
• The price your want to generate 
• The amount of money and time you can invest at this point in your business development.

Frankly, your choice will depend largely on how strong you'd like to enter the market.
I will discuss each of those three channels separately in the following posts so you can make the best choice for you and also see the sequence in which you can develop your sales volume.

Selling in consignment
is the most common way to get the products to the consumer when moving from hobby to a business.
What it means is that you allow a third party to sell your products in commission. Usually there is an agreement to sign which states the percentage from sales you will give to the selling party and the liability the seller will cover.
The percentage varies between 10 to 40 percent (mostly around 30%) and the liability varies from exclusion to the full liability (for loss or damage.)

Positive Aspects/Pros:

• it is very easy to find an outlet that will take your work for sale in consignment
• you will get you products out to consumer
• you will build your name and reputation as a silk-art business/ artist.
• you can test the market
• you can test what design is selling best
• you can improve your selling approach
• you will learn in a real-life environment :) what the sellers ask and request, which will improve your selling skills and marketing features of your product

Negative aspects/Cons:

• No control over the handling of your products.
• Little control over the display and placement of your product in the store.
• No control over the sale of your products. 
• Often only basic information of the inventory movement (from the payment slip you will get with your cheque, you will know how many pieces sold, but seldom get information about which design or particular scarf was sold/ which is very important information for your next delivery)

When is consignment the right approach?

• when you like to collect experience with selling and marketing of your products
• when you are building your reputation as an artist and business-person
• when you can somewhat regularly visit the consignment store and check on your inventory
• when you are introducing your product on a small scale 

What is important when selling in consignment:

• Sign a contract so both parties know the rules. 
• Choose a store owner who likes your product.
• Provide the seller with the information important for the sale. #1 are your business cards in a respective business-card stand/holder and if you have a brochure or a catalog provide those as well. The more information about you and your products you have in the store on display the better.
• Most important is to have you product delivered with all that needs to be said about it stated on the packaging or the certificate of authenticity - there you have 100% control of what information will reach the prospective buyer of your product. Do not count of the staff to provide information about your product, make sure your product speaks for itself.
• Identify your products with an individual code (Item ID) and list all items individually when putting together your package for the consignment store. You can print several copies of those delivery lists and ask the owner to mark the sales and send it to your with the monthly cheque. You will see how far you can go in the negotiation of this part.
• Visit the store and check your inventory regularly.
• Check if the inventory movement is correctly reflected in the payments your receive.
• Exchange the products that are not selling for new designs. Most of the consignment stores have regular clients who know the store inventory well and look for new arrivals.

In Summary:

• Consignment is the best and easiest starting point to get your products out to the consumer.
• for the first approach see the checklist below.

Consignment checklist:

• the best of your products perfectly ironed, packages and Certificate of Authenticity attached.
• Each scarf has a specific ID (marked on the certificate of authenticity or on the price label)
• inventory list
• business cards in a business card holder
• Know your price - how much you want/need to have from the sale of the scarf. The consignment store usually wants to know the retail price/ the price that is to be charged to the consumer and you need to concider how much will be left once the commission is taken of the amount.
• The retail price you can realize on the local situation, the store, its clients, other items sold, type of client etc. You can calculate your cost in a real-cost projection with your time and portion of the location cost or just for the easy start use a common rule of thumb and multiply your materials by 2.5 to 3x. NOTE: this calculation applies ONLY to this type of scarves as it is least labor/time intensive. Later when we will speak about more elaborate design techniques this rule will not apply to their pricing.

Tip:

• Have always your business cards with you 
• Have your sample package neatly(products and promotional material) prepared in a small suitcase or a quality box in your vehicle (for unexpected opportunities)
• Take your sample package with you when you make the first contact.
• When making the first approach in a consignment store, choose time in the day with least store-traffic. 

Live with the knowledge in your mind that

You have an amazing product, which can enrich the life of many people;

You are serving others through your talents in the business of the silk-art.