So, I'm working on my pitch for distributors, and before I reach out to anyone, I'm trying to wrap my head around pricing. I'll round the numbers to keep it simple.
My current per-unit set-up, with no distributor
If I add a distributor in the mix, should I try to keep the retail store at keystone pricing, and split the $5 profit with the distributor, so they are earning 25% of retail price?
So like this:
My average wholesale order is $300. So on a typical order, this would yield these profits:
50% of stores choose to re-order, and do so about every 3 months. These accounts would be $25/mo profit for me and the distributor.
So questions:
Any other tips or experience the forum can share about working with distributors?
My current per-unit set-up, with no distributor
- COGS - $5
- Wholesale - $10
- Retail - $20
If I add a distributor in the mix, should I try to keep the retail store at keystone pricing, and split the $5 profit with the distributor, so they are earning 25% of retail price?
So like this:
- COGS - $5
- Distributor buys at - $7.50
- Wholesale buys at - $10
- Retail Customer buys at - $20
My average wholesale order is $300. So on a typical order, this would yield these profits:
- Me - $75
- Distributor - $75
- Store - $150
50% of stores choose to re-order, and do so about every 3 months. These accounts would be $25/mo profit for me and the distributor.
So questions:
- Does that pricing make sense? Would that be a good deal for the distributor?
- Would it be worth increasing the stores' buy price to beef up my and/or the distributors profit?
- Are distributors going to want more than 25%?
- What are your current pricing arrangements, and what else have other distributors you've talked to asked for?
Any other tips or experience the forum can share about working with distributors?
Dislike ads? Become a Fastlane member:
Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)
Membership Required: Upgrade to Expose Nearly 1,000,000 Posts
Ready to Unleash the Millionaire Entrepreneur in You?
Become a member of the Fastlane Forum, the private community founded by best-selling author and multi-millionaire entrepreneur MJ DeMarco. Since 2007, MJ DeMarco has poured his heart and soul into the Fastlane Forum, helping entrepreneurs reclaim their time, win their financial freedom, and live their best life.
With more than 39,000 posts packed with insights, strategies, and advice, you’re not just a member—you’re stepping into MJ’s inner-circle, a place where you’ll never be left alone.
Become a member and gain immediate access to...
- Active Community: Ever join a community only to find it DEAD? Not at Fastlane! As you can see from our home page, life-changing content is posted dozens of times daily.
- Exclusive Insights: Direct access to MJ DeMarco’s daily contributions and wisdom.
- Powerful Networking Opportunities: Connect with a diverse group of successful entrepreneurs who can offer mentorship, collaboration, and opportunities.
- Proven Strategies: Learn from the best in the business, with actionable advice and strategies that can accelerate your success.
"You are the average of the five people you surround yourself with the most..."
Who are you surrounding yourself with? Surround yourself with millionaire success. Join Fastlane today!
Join Today
