When Fiona Richards became tired of working as a graphic designer for corporate clients, she decided to start her own business. That was over eight years ago. Today, her wholesale greeting card and stationery business, Cartolina, sells worldwide to some of the most iconic retailers, like Harrods, Anthropologie, The Smithsonian, and The British Museum.
Cartolina now also sells directly to the consumer, via an online store, and has most recently opened a retail storefront in BC, Canada. Omni-channel retail is here, and many merchants like Fiona are wise to adopt it. Recent consumer studies by Forrester and MIT highlight many of the advantages of taking your business in this direction. Consumers are approaching purchasing from multiple angles – 80% of shoppers check prices online, and a third are checking product info via mobile while shopping in-store.
Companies with omni-channel engagement strategies see higher customer retention rates and increase in annual revenue versus those with single-channel strategies. Omni-channel shoppers, on the other hand, spend 50% more than single channel shoppers.
For Cartolina, the transition to omni-channel retail didn’t happen overnight. We chatted with Fiona about her decision to dive into new distribution channels. She shared with us her wins and losses as well as some valuable advice for other businesses taking the same path.
Cartolina started as a handmade line using vintage ephemera, carefully trimmed and glued together.
“I wasn't interested in selling one card at a time, so I researched the wholesale industry and learned that I needed to target the retail buyers to get the volume of sales that I wanted.”
A year after Cartolina’s launch, it became clear that the business was not scalable. Due to the time-consuming nature of handmade products, the demand became unmanageable. Back at the drawing board, Fiona designed a new collection – one that could be printed in bulk and warehoused. The new approach would require an upfront investment of a few thousand dollars. Before she made the leap of faith, she sent out press releases to her favourite magazines, announcing a fresh new stationery line from Cartolina.
“The response was overwhelmingly positive, which was the indicator that I needed to make the investment. There was a funny moment, back then, when our products were featured on the pages of Canadian House & Home before they were actually off the drawing board!”
The Wholesale Business
“I think it's common for new entrepreneurs to think that they can get their product in front of retail buyers all by themselves. You are very limited in what you can do by yourself. Gathering a sales force is very important.”
Wholesale businesses can enlist the services of sales reps and distributors, leveraging expertise and connections.
Sales reps shop product samples to retail buyers in different regions. They write orders which are then sent directly to your business, where you will fulfill and ship directly to each store, paying a commission to the rep.
“Be very picky to match your products and your personality with that of the sales reps. A good rep is worth their weight in gold.”
Distributors, on the other hand, will buy your product in bulk and sell and ship the product directly to retail buyers. Distributors work well for for overseas markets, when it becomes too costly for retailers to buy small quantities directly from you.
After five years of using international distributors and reps, Fiona realized that retailers wanted a more personal connection with their suppliers. Cartolina then began shipping from their Nelson BC headquarters. The switch was eye-opening.
“Our experience with dealing directly with buyers and shipping daily to stores gave us the confidence to open an ecommerce site. It was the next step forward for us”
How to Wholesale
WIth a seasoned wholesaler at our fingertips, we pressed her for some more first-hand advice for merchants taking the leap in this direction. Here are some tips we learned from Cartolina:
- Consider Fit. Be sure your product is appropriate for the retailer you’re approaching.
- Stay on Top of Trends. What’s in-store now is yesterday’s trend. “If you see lots of neon polka dots in the store, it's best not to pitch a product with neon polka dots,” Fiona warns. “That train has already left the station.”
- Connect. Larger retailers may have several buyers in your category, so be sure you’re connecting with the right one. Buyer info can be obtained, generally, by calling the retailer’s corporate headquarters.
- Keep it Short and Sweet. When contacting buyers, keep the intro brief and include small images, essential info and links to your wholesale catalog.
- Get Online. Create an easy-to-access online wholesale catalog for buyers that includes pricing and terms. Keep it separate from your retail site (if you have one) in order to avoid confusion. A wholesale line sheet is another great tool.
- Know Your Customer. Your customer, in this case, is your target retail buyer. Find out who they are and what blogs they read. Pitch your brand to these blogs for a potential endorsement or post that can get your products in front of your targeted buyers.
- Attend Trade Shows. Trade shows are great avenues for introducing your products to buyers. Fiona suggests NYNOW as one of best trade shows for wholesale consumer products. There are many other shows to consider, depending on your product.
- Be On Time. Consider that retail buyers have a buying schedule. Try to have new product launches four times per year. Some retail buyers will want to see holiday products as early as April and Valentines products are usually on buyers’ schedules in November.
There are several ways to offer both wholesale and retail through your Shopify store, whether it’s via discount codes, apps, or opening a 2nd storefront. Before getting started, however, do your homework. Launch Grow Joy collected even more tips from its readers on the subject and there are several other excellent resources to help you make a foray into the wholesale realm.
The Leap to Retail Ecommerce
“We really have gone from originally wanting to only design products and not deal with buyers and consumers, to wanting as much interaction as we can get. I think it is partially a response to having spent a number of years working online and communicating only with email and social media.”
Feeling isolated after years of online-only communication, Fiona’s team began to crave human interaction. Cartolina made the move to retail after 7 years of building a successful wholesale business.
“We wanted to know more about the Cartolina customer, get feedback on our products, and also have an authentic, public presence on the web – not a hidden wholesale site, which confused the average visitor.”
Cartolina launched as an ecommerce site early last year as a reaction to the disconnect that they felt with their end customers. Adding retail to the mix proved to offer many advantages including larger margins and the ability to market direct to the consumer.
Fiona reported that the addition of a retail channel increased wholesale orders by 20%.
Continuing to nurture the relationships with buyers while simultaneously dealing directly with end consumers became a tricky endeavour.
“It's important to take care of all of your customers.”
Wholesale buyers don’t want to compete with their own suppliers, she found. Keeping the peace meant being careful not to undercut pricing or offer too-frequent discounts or free shipping offers on her ecommerce site.
It’s good politics, she says, to extend discounts for retail customers to wholesale customers as well. Fiona also recommends leveraging social media to keep wholesale customers happy.
“If you've just shipped out a large wholesale order to a new retailer, take the time to introduce them to your followers on Twitter and Facebook. They will really appreciate the support and forgive you next time you offer free shipping to your online buyers!”
Cartolina’s experience with ecommerce was such a positive one that the company decided to take a stab at physical retail. This Spring, she bought a 130-year-old commercial building in her hometown of Nelson, BC. The building now houses the expanding wholesale business with a street-facing portion dedicated to retail.
This month, Cartolina opened its doors for business. The rear wholesale warehouse includes a sophisticated new shipping and fulfillment department to accommodate growing online sales. At the front of the building, Cartolina products are sold alongside a curated selection of products from other manufacturers.
“One of the benefits of opening a physical retail store for us is that we can incubate new Cartolina product in the store – if it does well in the store, then we will add it to our ecommerce site. And, subsequently, if the online response is good we can increase our production of that product, thereby lowering our costs and eventually adding it to our wholesale offerings.”
The effects of an omni-channel approach are already apparent – adding physical retail to the mix resulted in a noticeable uptick in retail ecommerce sales. Customers are able to interact with the products before making the decision to buy them later via ecommerce. Cartolina is also leveraging the power of social media and a history of shipping experience.
"We are featuring images from the new store on Facebook and Instagram and the response is that many of our followers are purchasing items from us as we post them! We are now shipping products, other than our own, to consumers all over the world."
Considering an omni-channel retail strategy for your business? With our recent launch of Shopify POS and Shopify Mobile to complement and run seamlessly with our ecommerce offering, we have a growing number of our online merchants like Cartolina selling in the physical space via brick and mortar shops and pop-up retail.
“Anticipate success,” says Fiona. “Make sure your business is scalable and can handle growth when it comes your way.”
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About the Author
Dayna Winter is Shopify's Social Media Manager and is responsible for content curation, community growth and engagement, and promoting Shopify merchant success through various social platforms. Connect with her on Twitter.