I just finished working 75 days, often 12 hour days, to complete a
collection of 46 pieces for a solo show at a major hospital. My
earnings, assuming everything sold: $78 a day, before the cost of
materials, the cost of materials replacement, tool charges, display
chemicals, etc. Prices range from $50 to $450. The 16 gauge cuff
above is $225. (!)
If you are running a business, then you must price accordingly, and
plan what you make, and how to make it, accordingly.
From a business perspective you must figure out your operating costs
- rent, insurance, materials, utilities, taxes, payroll, equipment,
etc. A portion of those expenses should be allotted to each item
There are a number of different formulas people use, but basically,
your wholesale price is generally half of retail if you do both.
Your wholesale must cover everything above (plus anything I left out
- but in short ALL of your expenses, which includes your salary!).
Then wholesale should include a bit of profit for you. Retail
includes a much higher profit ratio, but then has additional costs,
as now you are the one doing the selling with all the associated
costs - which now must also be covered by that retail price.
If I'm understanding your post correctly, your prices are NOT
covering your actual costs including payroll. The "simple"answer is
you need to raise your prices. The more complicated answer might be
that you need to take a hard look at your market, and decide if what
you are making and how you are making it are really the right
choices for that market, and then adjust either what you make and
how to fit your current market, or work to develop a market that
will deliver higher prices.
Good luck! I'm sure there will be lots of helpful suggestions.
One of the beautiful things about being self employed is that you
make all the decisions, including pricing. Often people think that
they can't charge more for their work, they have any number of
reasons. When in reality they can. In the rare case where you can't,
say you're hand making zinc plated lag bolts, then you may need to
reconsider your product line or change your production methods..
A simple way to calculate your prices is to decide how much you
reasonably wish to make annually and divide that by 2000 (there's
2000 working hours in ayear if you work full time).
Then total your overhead. Your shop rent, utilities, tooling,
consumables, travel, marketing, phone. everything. Then pad that a
little to cover unknowns. Then divide that by 2000 as well.
Add those two results together and that's your hourly rate. Keep
track of the total time each piece takes takes you and multiply to
determine the labor portion of your charge.
Then material costs need to be totaled, marked up and added to the
labor charge. Often people use a variable multiple on materials
depending on cost. More for inexpensive materials and then less as
the cost increases. That's a personal choice.
It's nice to use this to determine your wholesale pricing, then
choose another multiple for retail. Often that's double but it's
often less (but sometimes more).
If you use your formula every time you will always make enough
money. If not, increase your rate and or mark up. Mark