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From DTC to wholesale

Selling Retail: What It Means When You Already Sell Direct

By Martin Mecar, founderJuly 2, 20267 min read

Selling retail means selling to the person who will use the product, at full price, one or two units at a time. You already do it online. The phrase usually comes up when a brand starts thinking about the physical versions of the same thing: a market stall, a pop-up, a shelf in someone else's shop, eventually a shop of your own.

Each of those is a different business with different maths, and a Shopify brand that treats them as one thing tends to pick the expensive one first. This is what each costs in cash and in hours, using a candle that retails for twenty-four dollars and costs six to make.

Your own site is retail, and it is the benchmark

Start by being honest about the channel you already have, because every other option gets measured against it.

Online you sell the candle for twenty-four. You pay card fees, the mailer, the label, the packing minutes, and the cost of getting the visitor there. If paid traffic is bringing the order and you are paying eight dollars for it, a single-unit order leaves a few dollars. A two-unit order with free shipping over a threshold is where the channel becomes healthy, which is why your whole store is built around that threshold.

The important number is not the margin, it is the acquisition cost, because it is the one that moves. When it creeps up by two dollars, the single-unit order stops working. That fragility is the reason brands start looking at physical retail at all, and the strategic version of that comparison is in DTC vs retail.

Markets and craft fairs: full price, real cost

A market stall is the cheapest way to sell retail in person and the most misleading about what it earns.

A weekend stall might cost sixty to two hundred dollars for the pitch, plus the table, the cloth, the display, the card reader and a day of your life. Sell thirty candles at twenty-four dollars and that is seven hundred and twenty dollars of revenue, one hundred and eighty of cost of goods, minus the pitch, minus card fees. The cash looks good on the drive home and worse when you count the hours across setting up, standing there, packing down and restocking.

What makes a market worth doing is not the takings. It is the four things you cannot get online: watching a stranger pick up the product and decide, hearing the questions that your product page does not answer, collecting email addresses at a rate no ad will match, and meeting shop owners, who shop at markets specifically to find brands. More than a few first wholesale accounts start with a boutique owner buying one candle at a stall.

Pop-ups and a shop of your own

A pop-up is a market stall with rent and a lease clause. A short residency in a shared space or a quiet high street unit can run anywhere from a few hundred dollars a week to several thousand, before fit-out, insurance and someone to stand behind the counter while you are making stock.

The arithmetic is unforgiving. At a twenty-four dollar candle with six dollars of cost, every week of a thousand dollar rent needs about fifty-six units sold just to cover the rent, before staff, before card fees, before the stock you brought that did not sell. Most small brands cannot forecast that with any confidence in a location they have never traded in.

A shop of your own multiplies every one of those numbers and adds a lease. It is a genuinely good business for some brands, usually ones with a wide enough range that a customer can spend sixty dollars in one visit, and usually in the founder's own city where they know the street. It is very rarely the right second channel for a brand with three products and one pair of hands.

Selling retail through other people's shops

The fourth option is the one most DTC brands end up on, and it is the only one where somebody else pays the rent.

A shop buys the candle from you at twelve dollars in cases of six, and sells it at twenty-four. You get half the retail price and none of the retail work: no pitch fee, no lease, no Saturday, no staff, no card reader. You pack one box of six instead of six mailers. You send one invoice. If the candles sell, the shop orders again without being asked.

On paper you gave away half the price. In practice you gave away the half that was being consumed by acquisition, packing and standing in a field. The full comparison of the two margin structures is in wholesale vs retail, and the price ladder that makes it work is in wholesale vs retail price.

The trade is control. You do not choose the shelf, the neighbours on that shelf, or what the person behind the counter says. Some of that you can influence, and the part you can influence matters more than brands expect, which is the subject of retail placement.

What selling retail in person demands from the product

Anything that goes on a physical shelf, yours or somebody else's, has to work without a product page attached to it. That is a real product change, not a marketing one.

The packaging has to say what the thing is, from an arm's length, to someone who has never heard of you. Your DTC box can be minimal and mysterious because a product page did the explaining. A shelf box cannot.

It needs a barcode. Shops scan, markets increasingly scan, and your own card reader is easier to run with scannable stock.

It has to survive handling. On a shelf, a product is picked up, put down, knocked over and put back upside down for weeks before it sells. Corners scuff, lids loosen, labels peel. Whatever your worst case is, it happens.

And it needs a size and a price that make sense as an impulse purchase in the twenty to thirty dollar range, or a considered one with a reason above that. The middle, where something is too expensive to grab and not special enough to think about, sells badly in person even when it sells fine online.

Running both without breaking either

The usual worry is that shops stocking you will eat your online sales. In practice the leak runs the other way: your own promotions eat your shops.

Keep one retail price across everything. The candle is twenty-four dollars on your site, at your stall, and on the boutique shelf. When the shop sees your site selling at nineteen, their margin turns into a liability and they stop reordering. When your stall undercuts a shop two streets away, you will hear about it within a week and you will deserve to.

Discount with bundles, gift sets and new releases rather than sitewide codes. Save real clearance for products you are discontinuing, and tell your accounts before you do it.

If you are not sure which shops would plausibly stock your product, paste your store or product link into WholesalePilot and look at the preview of retailers and distributors carrying comparable items. It is a faster way to size the physical channel than doing a pop-up to find out.

Which retail channel to add, in what order

For most Shopify brands with one or two products, the order that costs the least and teaches the most is: keep the site, do three or four markets to watch people meet the product, use those markets to collect shop owners and email addresses, then pitch twenty shops with the packaging and the price you fixed after the markets. Consider a pop-up only once you have a reason to believe a specific street works, and consider a shop of your own only after that.

The cost of getting this order wrong is not just money. A pop-up that does not work takes a quarter of your attention and all of your cash at the same time, and it rarely tells you anything about the product, because location noise drowns the signal.

Questions about selling retail

Is selling retail more profitable than wholesale? Per unit, yes. Per hour, usually not, once you count acquisition, packing and the time physical retail eats.

Do I need a different product for shops? Often a different size or a multi-pack, rarely a different product. Shops want a shelf-ready version at a price the local customer will pay.

Should I sell at my own stall in a town where a shop stocks me? Tell the shop first, price identically, and ideally point people to the shop for restocks. Handled badly, it costs you the account.

When does a brand stop doing markets? When the hours are worth more elsewhere, which is usually once five or six shops are reordering on their own. The decision of when to make that switch is covered in how to start wholesale.

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