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Pricing...?...please help


#1

I know this has probably been covered before, but I have been
offlist for a while and am now back on. I would like to post
some of my work on the web with links to a home site with/for
custom work, but have no idea how to price my work. I am working
in silver sheet/wire and have a fair idea what to charge for
materials, but am fuzzy on what to charge for my time. To this
point I have been taking a totally arbitray number and trying
for that amount. Would really appreciate some guidance on what
to charge for sterling work.

Thanks,
Radonna


#2

Radonna,

I’m having the same problem. I work mainly in silver and some
14K and am so torn about pricing. I know the cost of my
materials, but how do you put a price tag on your time and
unique, one of a kind creations?

I just sold a nice, heavy pendant that was an abstract circle of
sterling with 14k yel accents with a bezel set cab in the middle
for $85.00. I feel like I practically gave it away, BUT, the
person who bought it is a hair dresser in a wealthy area and I’m
hoping for exposure.

Looking forward to the responses on this subject.

Kelly Rae


#3

Dear Kelly, I would be willing to make book that there will
be many responses to this query…I’ll add mine now…Don’t
give it away… If you thought you gave it away at $85.00 then
you did…what price would have made you happy ? You see we
all have different overhead. I have a big store with big
overhead, others have a garage with smaller
overhead…others have a small operation…and on and on… As a
wise old man once asked me when he picked something out of my
case," how much do you need ". I have adjusted my prices up
lately for custom work mainly because a check of what many
others are charging told me that I was not charging
enough…But the question was how much to charge…oh boy…I
didn’t see the work …sounds too small an amount…double the
charge… (out on a limb)

Now about the hairdresser and exposer..It may work for you
and then the charge would be a good move...I have never had a
good experience with this type of advertising..most of the
time customer fallout from this type of advertising produced
the same type..that is to say..can you make me one for the
same price ? hmmm...backfired on me... once there were ten of
them.! 

Many people who can afford jewelry are not always looking
for price..try to target your audience or customer base if
you are in a position to do so. If not, and you can afford to
set your price to a reasonable profit ( reasonable
profit..here we go ..industry wide a triple key is not
unreasonable ..one to replace the item, one to cover your
overhead and one to live on.)  then you should do so.. 

And then it seems not so long ago when I was workin cheap... 

try grow learn enjoy

Terry Parresol


#4

Hello Radonna. Hello Kelly,

I am an independent commercial gemcutter working for the
Vancouver area Jewellery trade.  I am currently in the middle
of an on-line presentation of my observations and suggestions
 for gem cutters considering the wonderful world of wholesale
repairs and cutting. 

The following extract from my presentation may be useful for
you to consider whilst agonising over your prices. This
extract is a sneak preview from part III which is to be
presented on Tuesday August 4th at 6:00 p.m. P.S.T.  in the
main chat room at http://24carat.net/24carat/ click 'chat' at
the bottom of the page. 

extract; 

Setting prices that are fair to you and fair to your
customer can be one of the biggest headaches in store for
you. 

There is a big difference between giving away your time and
charging like a wounded rhinoceros. 

Hopefully I can help you to determine what is a job worth. 

Possibly about the most difficult thing an artistic type can
be asked to do is to put a price on their own work. 

Obviously if your charges are too high nobody will use you,
if they are too low you will indeed be 'used' but you will
also be hungry. 

There are many factors that have to be considered when
coming up with a price list and pricing policy. 

First you have to know what YOUR costs will be, how much YOU
have to pay to do the work, your rent, electricity, supplies
etc. 

Then you get to add your remuneration for the job,  the
profit to your 'company' for contingencies and growth. 

Finally there is personal greed and reimbursement for being
dreadfully clever. 

This total would have to be moderated by the market value of
what you are offering and enhanced by what you think your
market will bear. 

Now ask yourself whether you would do this job again for
this price? How about a bucket full at this price? 

If you can answer "Yes" and "Yes please", you are about
there. 

Now when you think you have it figured out and it's fair to
everyone, especially you, then stick by it faithfully, don't
compromise price for anyone. 

You will be approached for requests for workshop time by the
hour and once more it's time to resist. 

You aren't a machine you probably don't have a factory, at
best you might have independent workspace. 

You have gone to the trouble of working out a fair price
list, employ it, enjoy it. 

If there is multiple or quantity cutting work being offered
and you think that it can be quicker because of the quantity
then guess at what the reduced amount of work might be and
reduce your fee by 1/2 of that. 

You could still come up a bit short. 

A word of warning on discounting though, make certain that
your customer is aware that the price you are quoting is for
the quantity stated ONLY. 

When you discount, your customer is highly likely to assume
that this is your REAL price and your quoted price is
profiteering. 

However if you give someone your work for free because you
feel this advertising expense will advance your future
business then they will never assume it is ok to get more
work done at that price. 

\ () || |/
\ /
/
web site: http://www.opalsinthebag.com
e-mail: cutter@nospam@opalsinthebag.com

Vancouver, B.C. CANADA.


#5

Cost of materials times 2.5 and then add your “hours spent
making” and then don’t forget to add your consignment amount.
IF it turns out to be TOO expensive, you should consider
cutting down the time (it takes you to make the item.)


#6

Terry, Thanks for the input, I always struggle with pricing and
thought tripling seemed like so much (I have a hard time seeing
my works value objectively, it’s so easy for me to come up with
original designs) you helped me get a new perspective. Now, I’ve
heard from various sources (word of mouth and a couple of books
on selling crafts) that it is unwise to charge less at an
exposition or art/craft type show than one would in a retail
setting. Are there any opinions on this out there? work’n away in
lovely Oregon… hsqueenc


#7

Kelly & Radonna, one of the most difficult things to do is to
charge for your own time - and that’s not unique to the jewellery
business…

The subject of pricing has been covered before and can probably
be located in the Orchid archives. I had the same problem
earlier (prior to an earlier Orchid discussion) and I took in
the advice of charging 2 to 3 times material cost. In fact I use
3 for Sterling and 2 for findings etc as I believe that a margin
of 50% is OK on others work… In addition to that I charge for
my time as much as I dare.

Cost of your own time has to be calculated by yourself - the
best advice I got from last discussion is something like: Work
out your total cost for jewellery related work (i.e. all costs
applicable - cost of capital, rent, the annual share of cost of
tools and machinery, capital cost of stock etc) and don’t forget
your salary and perhaps some nasty taxes. Then, divide with the
total number of hours you think you will spend on your work but
remember to include all hours (not only bench time) as you
include ALL your costs. The figure you get should (if
everything is in) give you an indication of what the cost of
your time is - I’ve found it valuable to know the true cost -
you sort of know here your bottom limit is i.e. when you start
giving money away. To this cost figure you should add your
hourly mark-up - for me a 50% margin (i.e. cost *2) works OK but
this is of-course related to how much time you can charge for.

This is much easier said than done - but try to do the exercise
to learn the truth (?). I did this and found out that my hourly
cost (calculated) was much higher than I dared to charge (after
all - It’s your own judgement that has to be thrown in at last).
My analysis was that:

  1. I worked many more hours than I first expected - I recorded
    ALL my spent time during a few months

  2. I used much more money on gadgets than I could afford related
    to what I sell.

Finally I looked to what I produce and I adjusted prices as much
as I thought possible.

One advice I can offer is not to undersell yourself - and if you
for some reason (call it marketing, image making or whatever)
feel you should lower the price for a specific reason - make
sure that the one in favour of the lower price knows this - and
why.

R G D S Lars Dahlberg - Gotland/Sweden


#8
 . Now, I've heard from various sources (word of mouth and a
couple of books on selling crafts) that it is unwise to charge
less at an exposition or art/craft type show than one would in
a retail setting.  

Gallery Customers would be very upset if they find you at a
show, selling the same item they have just purchased, at a
greatly reduced price . . . the gallery owner wouldn’t be very
happy with you either. One way to avoid this would be to make
entirely different kinds of items for shows (art/craft) and for
galleries. IF I take items out of a gallery for a show, I do
not lower the price. If the gallery can sell it for "inflated"
price, why shouldn’t I be able to ask the same price? Set a
price and let the customers decide if it is too high!


#9
   Now, I've heard from various sources (word of mouth and a
couple of books on selling crafts) that it is unwise to charge
less at an exposition or art/craft type show than one would in
a retail setting. Are there any opinions on this out there?

I’m glad you raised that question. I have heard the same thing
and have wondered about the theory and economics behind it. If I
either sell or consign my work to a Gallery, the price I need to
get for it will be doubled, with none of the profit coming to me.
If I sell something privately (either direct sale or at a show)
I may feel that the price the Gallery can ask is too high for
what I can ask under the different selling circumstances. I
could sell it directly to a customer for the price I would get
from the Gallery -or - I can add a small amount for profit and
still earn more than I would from the Gallery. I realize that if
a piece is in a Gallery, you can’t undercut the identical item by
selling it for less. However, what about similar, but not
identical things?

Would enjoy hearing all and any thoughts on this. Sandra


#10

How about pricing the item the same as the gallery, but giving
interested customers a discount when they seem interested?

I’m not good at haggling, though, so i’m not sure if it would
work for me! -amery in venice

Amery Carriere,
Assistant to the Director
Annenberg School for Communication
School of Communication
3502 Watt Way ASC304 F
LA, CA 90089-0281

phone: 213.740.0934
fax: 213.740.3913


#11

Problems with double standard pricing arise when you get the
same customers in both venues. They then ask, rightly I think,
why the customers at shows get things for less than they have to
pay at your permanent retail outlet. My solution is to price the
same at both locations and then make individual ad hoc price
adjustments as the situation warrants. As for similar, but not
identical things, I always use the same pricing formula,
regardless of selling venue, mark the items base on that formula,
and then make the same ad hoc adjustments.

Keep on rockin’ Mike


#12
  "If I either sell or consign my work to a Gallery, the price
I need to get for it will be doubled, with none of the profit
coming to me." 

If that is the case, then I would humbly suggest your price is
too low. The book, “Sell What You Make, The Business of
Marketing Crafts” by Paul Gerhards, Stackpole Books, explains all
the pricing very well.

He says to start with your wholesale price, not retail. If
you can’t wholesale it to a gallery at 1/2 your retail, then your
retail is too low and you’ve got to raise it.

I price by using detailed on all the costs that go
into it and timing myself on how long it takes to make. Hope
this helps.

-Elaine
Chicago, Illinois, US
Great Lakes