Catalogue gift companies markup question

[ChopperKhan]

Hi,

I run a small business producing a unique personalised video product which sells through catalogue gift companies. I am now about to pitch the product at a new price as it will now be available as a personalised DVD.

My question is - what is the accepted markup when dealing with catalogue companies? (the type that send out glossy magazines direct to potential customers - and then forward orders to me for the personalisation).

Previous dealings with these companies seems to indicate that they work on 100% markup - therefore if I sold trade £10, they'd charge £20+ VAT.
Is this the norm for these sellers? What is the norm anyway?

My problem here is being able to charge enough to make it worthwhile, whilst still keeping the RRP at a acceptable level.

Any advice/knowledge would be greatly appreciated.

Paul

[Sarah-Ink Promotions]

As one such distributor I would say that the majority of my suppliers use a 30-40% markup although some of the smaller companies go up to around 55% - depending on how competitive it makes their product.

Id be interested in seeing some info when you confirm a price etc...

[sparklyscotty]

I sell jewellery to trade, and the catalogues that buy from me go by the same mark-up as shops, which is usually 100% plus vat. Some of my higher-end clients (like boutiques) will go higher... it depends on what they can demand from their clients.
I know it's difficult to price and keep a balance of wholesale/ rrp values, but at the end of the day, if it aint making you money to sell wholesale, then you shouldn't be doing it. If making it worthwhile for you is going to push the RRP too high, then you should look into selling direct retail instead.
That said, at the end of the day, the RRP is the catalogue company's call. As long as you get your cut, that's all you have to worry about.
-Angel-

[aromaqueen]

Mark up varies. The gift market seems to always expect 100%. I've discovered, however, that not every area expects such a high return. For example, pharmacies, chemists seem to work on a 30 - 50% mark up. The more I talk with potential wholesale clients the more important I feel it is to actually discuss (and negotiate) where possible.

What it comes down to, as has been said, is that if it isn't profitable don't do it!