I’ve always wanted to sell things. When I was 10, I remember visiting my local pottery shop on a weekly basis and buying up a few dozen un-baked coffee cups. I’d draw cartoons on them (I was actually pretty good back then) and bring them back the next day to have them baked.
I’d eventually take them into my local police department or church … and sell them. I did sell a few, But I never really made a profit. The price of the actual mugs, the kilning and paint all cost much more than what I made from sales. This is the same dilemma I have in the retail world. I’ve been selling my own logo design software product in retail stores such as Fry’s Electronics and Office Depot for a few years now.
The boxes each cost (roughly) $3.00 to design. This includes the cardboard, the CD and sleeve, as well as the burning of the disk …and putting in the ‘filler’ to make the box appear strong and sturdy on the shelf.
You can hire a local designer, or find one on the net from companies likes elance.com or moonlighters.com. A designer may charge upwards of $2,000 to $7,000 to design the box! (I’m lucky enough to be able to design my own boxes). A good rule of thumb is that you’ll most likely spend $3,000 for 1000 boxes.
The least amount that the printshops will let you print is about 1,000 units. It may sound small, but the cost can really add up when a chain like OfficeMax has 1200 stores with each store ordering a minimum of 5 boxes. That’s 6,000 boxes! It adds up quick.
Once the boxes are manufactured, you have what they call “Shelf Space” to deal with.
Not all, but some retail chains won’t just take a product and put it onto their shelves. They need cash for this “shelf space” first.
Shelf space can get as pricey as $6,000 for just one software product! (You need to sell a lot of product to make up for this. And THEN, you’ll find that the retail chain requires it’s cut. Sometimes up to 20% … it gets crazy.
Why the internet is better
This is why the internet is so terrific. NO overhead other than your time. (I use external eCommerce companies to handle my shopping cart system. They take 20% of my monthly sales. …but it’s WELL worth it I must say).
This is why downloadable software is so profitable. Create it once and sell it multiple times. An eBook or homemade CD as an example. The Retail stores used to be king, but no longer. The Web rules!
It may be a bit more difficult to market yourself online with so much more competition, but that’s where your SEO (Search Engine Optimization) and eMail campaigns come into play …but that’s a topic for another article.