Selling Lighting Online
Pricing strategies can be tricky when selling through e-commerce sites.
 
We have developed a new line of lighting and intend to market it online through an e-commerce site. I have a question for you regarding pricing strategies. Our site is set up so anyone who goes there can make a purchase at a sell price. We want to offer a trade discount, but we are undecided as to how to approach this. What can you tell me about current trends in pricing for decorative lighting sold in this fashion?

First off, have you considered selling your new line through existing e-commerce sites? They already have a built-in reputation and a consistent traffic stream, which you would not have to create from scratch. Many of them handle both retail and wholesale orders. You would sell to them at one price, or you might possibly set up a two-tiered deal where they pay more for retail purchases. 

Driving traffic to your site, especially a new site, would be a big undertaking since you have just one line to offer. But it’s not impossible. Companies like Boyd Lighting are wholesale-only. Online retailers, like the Horchow Collection offer a trade discount for large purchases. They have a “trade” link at the bottom of their website that explains their terms.

In order to separate retail purchasers from wholesale purchasers, buyers would need to fill out an online form, including providing a valid resale number linked to the buyer’s name in order to get the trade discount. You could then give them a password to log onto the wholesale section of your website for future purchases.

Pricing-wise, my recommendation is that you keep the retail prices fair and then offer a comfortable discount for wholesale. More retail sales are driven by online purchase than wholesale. More and more brick-and-mortar stores are offering the opportunity to make purchases online as well. This opens them up to buyers which would normally be outside of the region of their actual stores.

randall_whitehead
Randall Whitehead, IALD

Randall Whitehead, IALD, is a professional lighting designer and author. His books include "Residential Lighting, A Practical Guide." Whitehead has worked on projects worldwide, appeared on the Discovery Channel, HGTV and CNN, and he is regular guest on Martha Stewart Living Radio. Visit his website www.randallwhitehead.com and follow his blog www.lightmakesright.com for more information on books, upcoming seminars and the latest lighting trends.

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