How to price alpaca stuffed animals in your shop

The landed cost of an alpaca stuffed animal is everything you pay to get one piece onto your shelf: Tubi's wholesale price plus your share of freight, import duty, customs handling, payment costs and any label you add. It is the number your markup should start from, because the wholesale price alone leaves part of the cost out.

Work it out per piece, for the whole order at once:

1. The wholesale price. Tubi prices each piece in USD by collection, size and order volume, ex works. For toys and accessories, standard pricing up until 100 pieces, with volume discounts from 100 and 500 pieces, counted together. Rugs are counted on their own. The prices are on the collection page.
2. Freight. Take the freight bill for the order and divide it over the pieces. With DAP the freight to your door is arranged by Tubi and stated in the quotation; with ex works your own forwarder quotes it. A Large alpaca takes far more room in a box than a Mini, so if your order is mostly one size, weigh the freight towards it.
3. Import duty. A percentage of the customs value, set by your country. Into the EU it can be 0% with proof of Peruvian origin, which Tubi arranges on request with the quotation. Costs can differ or change with recent tariffs, so confirm the rate for your country with a customs broker.
4. Broker, payment and bank costs. The broker's fee for the clearance, and what your bank charges for the two international payments.
5. Your own label, if you want one. Tubi puts its own Tubi tag and the age label on every alpaca. A private label costs $0.20 extra per piece.

Import VAT is usually not part of the landed cost for a VAT registered business in the EU or the UK that makes taxed sales: you pay it at import, or account for it on the return, and deduct it again in your VAT return. If you are not registered for VAT, add it as a cost.

Worked out on Tubi's price for a Naturals Medium of 32 cm, an alpaca stuffed animal bought at $22.00 lands at about $28.16 when you add example costs of 20% for freight, 5% for duty and 3% for the rest. Those three percentages are examples to show the method, not quotes and not the rate for any country: replace each with the figures from your own freight bill, your broker and your bank.

The same example costs on each size of the Naturals collection give the table below. Rainbow has the same prices per size, Untrimmed is a little lower, and Zebra, the specialty, starts at $16.90 for a Small; the sum works the same way for each.

Read the last column as an example of the method, not as advice on what your shop should charge. Your rent, your staff and the prices of the shops around you decide where your own number lands.

Shops commonly price alpaca stuffed animals at keystone, twice the cost, or higher: independent gift retailers often work at about 2.3 to 2.5 times wholesale, and go above keystone to cover their shipping costs. These are common practice in the gift trade, reported by retailers themselves, not a rule.

Apply the markup to the landed cost from the example above, not to the price on Tubi's invoice; a markup on the invoice price alone quietly spends part of your margin on freight. A trade magazine survey of gift shop owners shows the spread: one kept to keystone on most items and priced above it to offset shipping, another averaged 2.3 to 2.5 times wholesale and stopped buying what would not sell at that price.

Handmade alpaca stuffed animals in natural fur sit in the gift corner, so a markup above keystone is usual for them. Whether your customers accept it depends on your shop. Test a size at one price for a few weeks before you print it on every tag.

Ordering 100 or 500 alpaca toys or more lowers Tubi's price per piece, so at the same shelf price your margin grows: on a Naturals Medium sold at $70.40 the example margin goes from 60% under 100 pieces to 64.9% from 500 pieces. Toys and accessories count together, so a mix of sizes and shades reaches the tiers together. Rugs are counted on their own.

In this example the freight per piece stays the same in dollars at every tier, while duty and other costs follow the lower price. In practice a larger order often brings the freight per piece down as well, because boxes ship fuller; the table does not count on that.

A bigger order also means more stock to sell before you see the margin. If you are new to alpaca stuffed animals, a first order around the minimum of $350.00 shows which sizes and shades sell in your shop; the tiers pay off on the reorder.

Give each size of alpaca stuffed animal its own clear price step, so a shopper sees the Mini as the small gift, the Small and Medium as the main buy and the Large as the statement piece. The four sizes, from 15 to 48 cm, are a range a customer collects, and the price steps help them choose.

• Mini, 15 cm. The impulse buy at the till and the add on to a bigger gift. Keep it at a round number; at $11.00 wholesale it carries a higher markup more easily than the Large.
• Small, 23 cm, and Medium, 32 cm. The sizes most shoppers hold and compare. Leave a visible gap between them so the Medium reads as the step up.
• Large, 48 cm. The highest price on the shelf and often the one that makes the others look reasonable. A slightly lower markup here can still give the most money per sale.

Round the result of the sum to a price that fits your shop and your currency. Tubi's prices are in USD, so convert at the rate you actually pay, not the rate on the day you quote.

In the EU and the UK the price a consumer sees for alpaca toys must include VAT, so the tag shows your net retail price plus VAT. In the US there is no national sales tax: the states and often local areas set it, and the rate due depends on where the sale takes place, so the sum starts from your retail price and the tax follows the place of sale.

• EU. The EU price indication directive defines the selling price as the final price including VAT and all other taxes. Each EU country sets its own VAT rate; the standard rate cannot be lower than 15%. Work out your net retail price first, then add your country's VAT.
• UK. Under the Price Marking Order the selling price shown to consumers includes VAT, and the standard rate is 20%. In the example, a Medium at $70.40 net becomes $84.48 on the tag. A VAT registered importer can account for import VAT on the VAT return through postponed VAT accounting.
• US. There is no federal sales tax. 45 states levy a statewide sales tax and many allow local sales taxes on top, so the rate depends on where the sale takes place. Set your retail price first and let your till or webshop charge the sales tax due at that place.

The mistake to avoid in Europe and the UK is setting the tag at 2.5 times landed cost and forgetting that VAT comes out of that number. If the tag already includes VAT, divide by one plus the VAT rate to see what the shop keeps.

Tubi's quotation gives you the price per piece at your volume tier, the delivery terms and the ready date within 24 hours, which are the first numbers of your landed cost sum. Send your mix of collections, shades and sizes through the order form and name your country.

With DAP the freight to your door is in the quotation, so only the duty, the broker and your own costs remain to estimate. Ask for the proof of origin with the quotation if your country gives a lower duty on goods from Peru. Half the amount starts production, the order is ready in 2 to 8 weeks, and the other half is paid before shipping. Every alpaca is tested to the same safety standards and passes, so there is no extra testing cost to add; the results can be shown and sent on request. How ordering works step by step is on how to order, and display and selling tips are in the guide on selling alpaca toys in your shop.