News from the Pipemaking Workshop with the Funk.
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Monday, January 07, 2008

Why Dealers Matter

Biz News: As part of my push to get more stock on the website this year, I've just added another Ligne Bretagne Collector - a very pretty, huge, unstained handmade freehand. A nice piece for a nice price!

Today's pic is of yet another bulldog I've just finished. It's intended for a special request, but may end up on the site catalog, we'll see.

Some time semi-recently, I saw a post online that inspired me to write this little article. The poster in question had noticed that an artisan pipemaker had recently started selling via a few dealers and distributors as well as directly, and he voiced the complaint, "If he can afford to wholesale his pipes, why not just discount the pipes to his direct buyers and sell more pipes that way?" I was kind of agog, because this may sound logical, but it's a really uninformed idea. It presupposes a myth that lots of pipe folks seem to accept as rote - that pipe dealers and retailers essentially provide no service and only exist to jack up pipe prices. After all, if everyone can set up a website and sell direct, why pay these guys?

Many reasons, in fact. A dealer sale is guaranteed, for one (I'll get to that in a minute). When you wholesale a pipe to a dealer, you're offloading a surprisingly huge and annoying chunk of work to him, that of actually photographing, promoting, advertising, and selling the pipe. That's work that doesn't "go away" if a maker sells direct - It's part of the price of a pipe. The time I spend taking pictures and answering emails and writing catalog descriptions is every bit as much a part of the price as the time it took in the workshop. I can't "cut prices and sell more" - selling direct just drops all that promotional work on me. Not to mention the actual sale, collection of payment, and shipping of each individual pipe to a different buyer. That's an incredible amount of working time right there - just wrapping, packing, boxing, and hauling sacks of pipe boxes off to the post office. Selling to a dealer? Stick 'em all in one box, collect one check, and do it in one trip.

And it's a sure sale. Website direct sales are cherry-picked - Maybe you'll sell that pipe immediately, maybe you won't, maybe it won't even sell at all! When you wholesale, you smooth that out - the dealer assumes the risk of dead stock. Sure, you get less at wholesale pricing per pipe, but you get something every time, and you can let a much smarter salesman take the responsibility for finding buyers for everything you send him.

In closing, I hope this will help a little in understanding all the factors that go into establishing a price for a pipe, and explain just why workshop hours are not the total entirety of the price.