Hi there,
Is there anyone who has experience selling guitars in shops?
I've got a local shop interested, but I'm not sure how to go about it in terms of payment etc.
Do you do a contract?
Do they pay you when they sell one?
What cut do they take?
How do you calculate that into your wholesale price?
Any other advice?
Thanks.....
Replies
I sell a few in shops....usually the shop buys the stock off me, money up front, we agree their mark-up and ticket price so I have control over the selling price and their mark-up. Alternatively I do sale or return, same arrangements - agreed price and mark-up.
One difficulty is that whatever mark-up the shop puts on the item, they have to add 20% VAT. Music shop mark-up is often high: 50-100% is not unusual. Both these factors may mean they want to press you to discount your selling price....you might start wondering if it's worth it!
Hi Chris.
I suspect that the shop will want to sell it on a commission basis rather than buy it from you. That way if it doesnt sell then it has cost them nothing except a bit of space and management time, The usual rate would be 15% of the selling price. With them you will need to establish the lowest price that they can sell at to ensure that you get the profit you want to make and they get their 15%.
The big issue for you in this scenario is one of Title and Risk. You need to establish in a written document that you retain title whist they pick up the risk for the stock. Then if the instrument is stolen or damaged you are entitled to be paid.
The best route for you is to sell the product to them. Once you have done this then the product is legally theirs. You still need an agreement around Title and Risk, also returns, damages etc .Also best to get your money in exchange for the goods known as proforma. Standard payment terms are 30 days should you wish to give them credit and if you do you really need a title and risk agreement.
In my experience as a retail buyer for many years, the best deals always have a written set of rules.
You can pick up copies of example contracts and ROT (retention of title) agreements free from the web.
Even if it is informal get something written down or risk losing your instrument!
i have not sold any guitars through a shop but years ago i used to sell the odd model through a local shop - i always used to get a written receipt just to say the model was mine and the shop was selling it on my behalf as for the money side of things they used to take a percentage 15% of the sale price but you could also set the price you want and let the shop add there bit on top
but i'd say the best thing is to go to the shop and talk to the shop keeper then you both know what you want