Question about Purveyors and Dealers

S

Shotgunone

Joined
Oct 1, 2000
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I have questions about how knifemakers view and work with purveyors / dealers. I don't make many knives, but a few dealers have asking about buying knives. I have always graciously declined due to being able to sell what I make. However, a good friend and fellow maker sells quite a few of his knives to dealers. His thought is that many of the dealers go to shows he can not attend and therefore he is still represented at the show. He views the discount to dealers as any cost related to knifemaking, kind of like advertising.

So here are some of my questions.
As a knifemaker what is your opinion on dealers / purveyors in your business? What do you look for in a dealer or purveyor for example a web sites, shows attended, name, reputation, etc.? Do you recommend selling to dealers? Is there such a thing as a standard arrangement or discount? Do you use one dealer or more? What about making ordered knives for dealers? What about exclusive like a certain style or pattern that you only sell to one dealer?

I am not looking for negative comments on anyone or about using dealers. I am always flattered when someone contacts me and these guys have been very kind and understanding. I am just checking out how other makers work with people in the custom knife business and I don't want to miss an opportunity to work with other fine custom knife folks. Just trying to figure out how dealers and purveyors might fit into my little part time knifemaking now or in the future. Any additional related comments would be welcomed as I have lots more questions I didn't ask.

Regards
 
Here I go opening my big mouth again. :D I don't make or deal. Don't even do either on TV. :)


First of all I think it is important for a maker to attend as many shows as possible. It is a tough balancing act with a family, expenses, and time to make knives, but it needs to be done.

That being said, most makers, especially those starting out, don't have the resources (time and money) to attend every major show. Purveyors and dealers do. That is their business. When somone who is thought of highly represents you and your work the way you want to be represented, it obviously can be a good situation for both of you. If someone is not thought of highly, the representation can be detrimental to you.

Pricing. I think the knives should be sold at your price. When a maker goes to a show and sells a knife, the price is not pure profit for the maker. Keeping that in mind, offer your work to a dealer at a price that is fair to both of you and work out an agreement that the final price is close if not equal to the price as if a collector had ordered and purchased from you. If that can be worked out, the relationship has a good chance of being long and beneficial.

If you decide to make some limited patterns for a dealer, make sure that you will enjoy making them all and that you can keep (at least be close to) the delivery dates.
 
Here are my thoughts as a consumer.

If your knives are handled by dealer/purveyors like Les, Bladeart, Knifeart, Blade Gallery, etc. you are going to get some tremendous benefits. In my opinion, being seen on these web sites let's people know that you make a high quality knife, because high quality knives are the only ones these outfits will carry. You also get great exposure from the web sites and the shows that they attend. It is worth the discount that you will give them.

Now, if you are selling all the knives you are making and you don't want to sell more, then I guess you don't need what these dealers/purveyors can do for you. If on the other hand, you think it is time to expand your business this would in my opinion be a good way to do it. Look at all the makers using these sites, they must think that there is value in doing so.
 
I have the ultimate love/hate relationship with dealers, and it would be much more "love" if you could agree on a selling price from the dealer that would be very close to what you would sell it for (like Gus said). Quality online dealers like the ones already mentioned (hey you forgot Gary Levine ;) ) can be a great resource for buyers and sellers. I can't get to nearly as many shows as I would like to, so I can at least see new knives and different makers online. The exposure for the maker is tremendous, and can really boost a career. The key is to get the price as close as possible to your price so that everyone benefits. I have yet to find one that hasn't been extremely helpful, courteous, and some are just really friendly folks.
Dealers, IMHO, are the vacuum cleaners of the knife market. Few things get me more irked than driving 150 miles to a show, taking a day or two off from work, only to get there and find a large proprtion of knives have be sucked up by the dealers the night before, and now carry a 30% premium :mad: ! Hey, I understand they have to make a living, and their whole inventory is highly speculative. (I've seen knives sit for over a year and half online.)But it just leaves a really bad taste in your mouth.
The other thing you have to be concerned about is being "too successful", what if demand outstrips supply? Can you keep the dealers and your regular customers both happy? Is this going to be your full time job? If not, I'd have some reservations about getting too much exposure. Another venue that many have used successfully is eBay, and trust me, ALL kinds of collectors prowl eBay on a daily basis. This venue let's you control supply and gives you more exposure, and helps control pricing. Just a thought.
 
Hi Steve,

Your post seems to be filled with confusion and generalizations.

First, there are only a few custom knife dealers who do this for a living. With no other source of income or support from family members.

Second, why are you irked at the dealers? Like you we are buyers of custom knives. When in fact it is the makers who sell the knives before the show opens to anyone interested in buying them. Surely you don't think that only dealers buy knives on Thursday night before the show?
You would be amazed at the number of collectors in the Hotel bar the night before buying their favorite makers a drink or two.

Truth be told, I have never seen a dealer hold a gun to a makers head on a Thursday night (or any other night for that matter) and force that maker to sell the dealers knives. All the knife makers have to say is "no".

The reality of the situation is that shows are very expensive to do. A New York show can set you back $1,000 - $1,500 before the doors open. So what many makers do is sell enough knives to cover their expenses. It allows them to enjoy the show more.

The reality of the situation when you are self-employed is "cash flow".

As for myself, it has been quite a few years since I have been to a makers room to buy custom knives on a Thursday night. Usually I am the one who is having a private showing or two on Thursday night in my room.

Im curious about the 30% over retail (this on top of a discount?), who is doing that? 30% over retail does occur, generally these are knives that are hard to get. Additionally, the premium alos takes into account the fact that these makers are not giving a discount.

I sell 97% of my knives at the makers price. The very competitive nature of the web has forced a lot of dealers to sell at the makers price. So I think you need to a little more research on the knives that have a 30% premium.

Now that being said, you are correct there is a "love/hate" relationship with dealers. Makers love them when dealers are buying their knives and hate them if they are not or worse yet, quit buying their knives!

Shotgunne, you should view dealers as part of your "team".

In addition to purchasing knives from you dealers can offer the following for you:

1)Set up at shows that you don't attend and put your knives into customers hands. Customers that you would probably never meet.

2)Offer their expert opinion on your knives compared to others. For myself I am selective as to which makers I will and won't work with.

3)Established dealers who have heavily trafficed web sites. Can introduce your knives to a world wide client base, that you may not otherwise meet.

The key is to find out what you and the dealer can do for each other. This is not a one way street like many makers and some dealers think.

It is good to agree to pricing up front. My agreement with makers is that I will not sell their knives under retail. As you surf the net you will find this view is not held by many internet dealers.
As many have a sale page of some type.

This is usually not good for anyone. The makers knives are viewed as substandard by many potential buyers. Then the dealer known for doing this is now viewed by some buyers as a "wait and see". As in...wait and see if the price comes down. Also, it annoys people who paid full price for the knife. Finally, those who bought the first time and got a discount, expect that every time.

The business of custom knives features some commonalities. However, the custom knife business a lot of times is a "trial and error" type business.

Also honesty and loyalty is a big key. As you go deeper into the business relationship these will become essential parts of your ability to market your knives.
 
Originally posted by marcangel
Few things get me more irked than driving 150 miles to a show, taking a day or two off from work, only to get there and find a large proprtion of knives have be sucked up by the dealers the night before, and now carry a 30% premium :mad: !
Click to expand...

I would hate that too, but the blame - if blame there is - lies squarely with the makers. They are the ones peddling, or aggreeing to sell, their merchandise. The purveyors are just a market.

I think the whole thing would just not happen if knife shows started at 12 on Saturday. That way, most makers and customers would arrive on Saturday, and there wouldn't be so much time between when the makers and the really commited buyers get in (Thursday night), and the time when most of us can get there (mid-day Saturday.) I'm sure there are very good reasons why shows start on Friday mornings, but I can't think of why that is. :confused:

As for retailers or makers, for me, it's exactly the same thing. My favorite source of knives is the aftermarket, because I think the value is tremendous there. Outside of that, I would just as happily buy from a maker as from a retailer. However, there are some makers whose work is pretty hard to come by, and on those purveyors charge a hefty premium. For example, take Don Fogg. His prices are very reasonable (spear point textured bowie for $850), but his knives are available once in a blue moon. Same thing for Robb Hudson. What that creates then is an opportunity for someone to get such a knife and immediately turn around and sell it (or try to) at a very hefty premium. For example, there's a D. Fogg knife at thecustomknife.com which is for sale at a price several hundred $ above maker's price. Nothing wrong with that per se, but I wished more of the profit was going to the makers. Why those makers don't raise their prices is beyond me. Economically, the price *they* charge doesn't change the market price, which is a function of Demand and Offer - it just offers an opportunity for someone to make a good return on plain dumb luck.

JD
 
Les, I didn't say ALL dealers are selling ALL of their inventory at 30% over what the maker would sell the knife to a collector. But off the top of my head I'll name a few:

Bladegallery : W. Osborne Innova $1,750
Maker's price : $1,400

True North : Steigerwalt small black pearl $750
Arizona Custom
Maker's price : $600

KnifeArt : Hara small gent's with bl. pearl inlay $650
Maker's price : $500

Those are knives I'm very comfortable quoting, because I own them, and have purchased them from the maker either directly at a show, or have ordered them from the maker. I could make this list alot longer, but I think it illustrates the point.
Your site, BladeArt and Gary Levine are consistently near the makers price. I don't think we are in any disagreement at all. We seem to agree that a dealers relationship with a maker can certainly increase his sales and exposure provided the price stays near the maker's price. Obviously, there are many others who aren't.
Additionally, I'm referring to the buyer/dealer relationship, not the maker dealer relationship, and as a partner in a medical practice, I'm readily aware of cash flow issues. So, politely sir, it is you who seems a bit confused.









:p :p
 
Hi Steve,

No confusion on my part. As a full time custom knife dealer, I know exactly who is doing what.

I was just looking for clarification on your part. Thank you for doing so.

Regarding the Warren Osborne knife. Warren only gives a 10% discount. That discount is only to those dealers who continously buy knives from Warren.

So I suspect that Bladegallery did not receive a discount on that knife. Hence the premium. At $1750 on that Osborne, he is at the 25% mark. That is more than fair.

I don't know about Ken Steigerwalt, I belive he does give a discount.

Kouji Hara does give a discount, so I have no explination for that one.

Steve, we are in agreement on all of this. Im glad you understand about cash flow. I think some collectors lose sight of the fact that this is a business.

Your point about the buyer/dealer relationship is also well taken. Not only can dealers help makers. They can also help collectors get difficult to obtain knives.
 
Hi JD,

Starting a show at 12am on Saturday would not remedy the situation.

Fact is, most of the really good stuff is sold long before the maker gets to the show!
 
You are very right Mr. Robertson. And we do agree, heck half my collection comes from dealers! That is a real supply and demand issue, they have it. I want it, and am willing to pay a premium sometimes, rather than wait...and sometimes wait...for a year or more! I think on-line dealers serve a great purpose to collectors and makers. But as a collector, when I go to a show, I also have a big investment, just like a dealer. Travel, hotel room, time off from work (that's a killer). If I keep this up we're going to have to have a group hug.....:barf: ;) :)
 
Thanks for all the input. Even if it did nearly start WWIII or is it WWIV :D . As I feared there is no single answer or answers to the questions. I like the idea of having dealers sell my knives at shows I don't attend or can't attend. I can see the advantage to have knives on others web sites besides your own.

I also see the risk of having knives sold below my retail because I discount them to a dealer and then the dealer needs to move them. I understand how a dealer would sell over the makers retail price if the maker has a backlog, doesn't take orders, or is in high demand. I can see where a discount might be in order for a dealer that is really going to work for you - lots of shows and well known business person.

I really shouldn't have targeted my questions to the "knifemakers" but to all folks in the custom knife world buyers, liker, maker, et al.

I still feel pretty comfortable with my decision to sell for myself at least until I can make a few shows on my own and get to meet some more people.

I appreciate the thoughts and answers.
 
One additional comment. The more time a maker spends at a show, the less time he has left over to make knives. So, the discount percentage to a dealer is far less costly then the price of attending most shows.
 
...between a purveyor and a dealer?

Coop
 
Bob,

You are correct....but only if that dealer sets up at the shows. Not meerly just attends and walks around. The maker gains no benefit, as far as putting a knife in a potential customers hand.

Coop,

A Purveyor, is more like a broker. He/She is one who will act as a go between, for a fee. Generally, these individuals would not keep a large inventory...if any. There are few if any pure purveyor's in custom knives.

Dealers, are what most of the non-makers who buy and sell on a regular basis are.s are. They buy knives for re-sale. They carry a fair amount of inventory. Set up at shows...well the professional ones do.

Then there is the custom knife entrepreneur. While they do buy and re-sell knives. They also create and improve markets and trends. This is done through the synergistic custom knife teams the entreprenuer puts together.
 
Thanks, Les. Gotcha. So if I was looking for a knife by, say, George Herron, then if I contacted you and had you order one for me, that woud be the type of thing a pure 'purveyor' may do. I know of none. You, yourself, then act as a purveyor many times, I'll guess.

Second point: I'll assume you are pointing to other guys like Liong Mah and Joel Pirella as these stylish trend-setting designer dealers. You as well. I like the fresh appeal, too.

Coop
 
Hi Coop,

Your idea of a purveyor is partially correct. The other aspect would be to find a knife that has already been built. Say you wanted a Scagel or something along those lines.

Dealers, do a little purveying. But the main difference is that purveyors carry little or no inventory.

Yes, Liong and Joel have brought unique design elements to custom knvies. In Joel's case the knives are so few and seem to take sooooooo looooooong to get (I know the feeling Joel). That coupled with most of them being pre-sold. These knives don't have the impact they could have. However, the same restrictions that keep these knives from being readily available. Are the same ones that cause them to be pre-sold when he announces a new project.

Liong probably more than anyone (I know of at least)gets credit for introducing the Kerambit to custom knife buyers. As he does more projects he will refine his designs and will continually improve.

Joel on the other hand is already the master of the "French Curve"! His knives always have those sexy lines.
 
You are correct Les..... It takes a looong time for delivery.... (from concept to actual holding the knife) I got rid of the Prototype stage since it will add even more time.

The "bezier" curves.... yes. That's my everyday stuff. Sometimes I dream about them!:eek:

In this business, relationship is #1. you become a friend with your dealer and vice-versa. That way you can be more relaxed...

Regards,
 
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