Hello,
I am new to the jewelry business. I started making wire wrapped
jewelry and people have asked to buy my pieces, however I don’t know
how to price my work. Is there a rule of thumb that I can use to
guide me? Any help is much appreciated.
Thanks,
Rosa
Trying to remember my class in pricing… boils down to:
a (Material cost per gram)
b (Number of grams)
y (Hourly rate)
z (Number of hours–fraction if under 1 hour)
(a * b) + (y * z) = actual cost
The actual cost is what you need to get paid, so if in any situation
that has consignment fees, taxes or what have you then it has to be
added onto this so that you still get this.
A German woman who came over to Canada to workshop stringing pearls
deals in expensive materials (Palladium, 18k and the like) simply
doubles her material costs and calls it a day.
Hope that helps, I go slow, don’t like to be stressed and the like,
so I only charged CND$10.00 hourly rate as I will take 1 hour to do
what a production jeweller would zip through in a third or quarter of
the time (of course that’s as much a benefit of doing production runs
as anything else).
Some hobbyist are only charging $2.50/hour or less for costume
jewellery, but that only hurts themselves and everyone else. I
recommend that they at least get double the materials back (so they
can do their own projects without being out of pocket for the
materials, or for buying new toys–I mean tools–that they wouldn’t
otherwise be able to otherwise justify) if they place no value on
their time… hence the word hobby I suppose.
Kindest,
K. David Woolley
david.woolley@unb.ca
Trying to remember my class in pricing… boils down to:
a (Material cost per gram)
b (Number of grams)
y (Hourly rate)
z (Number of hours–fraction if under 1 hour)
(a * b) + (y * z) = actual cost
I’m NOT picking on you here, but it’s not quite that simple, and I
hope the instructor did not really make it seem so.
What this class left out:
Shipping costs to you, insurance, the time it takes to put it on
your inventory, time on the phone, time searching catalogs, time
searching the Internet, time/fuel/ins. for running down parts in your
vehicle, travel costs to get to shows, finance costs of your credit
card, bank account & checking account fees, advertising, website,
inventory tax, the costs of collecting sales taxes, general office
costs equipment, repairs, paper, ink, outside printing, postage,
rent, phone bill, Internet service, gas, electric & water. Your shop
costs tumbling compound, buffing compounds, buffs, light bulbs, new
tools, continuing education, magazine subscriptions, and your
monthly/yearly Orchid donations…
You add all of these costs up for the year, divide it by the hours
you actually work, add your hourly rate, and then your materials -
now you have a break-even price. THEN add in your profit. Now you
have a wholesale price!
Further markups happen when the gallery or retail store becomes
involved. They have to make money too…
Someone wanna pick up/chime in here? I know I missed about 40 or 50
other hidden costs that should be added into the cost of producing
and selling a piece of simple jewelry - IF you want to break even -
much less make a profit!
I’d venture to guess that the high failure rates in turning a
home/hobby venture into a real business are founded in the failure to
take ALL costs into account when pricing the product.
Brian P. Marshall
Stockton Jewelry Arts School
Stockton, CA USA
209-477-0550
instructor@jewelryartschool.com
Brian made some excelent points about what was missing from the
instructor’s pricing formula. I might have missed any other posts on
this thread but I’ll stick my toe into the water here anyway…
The real secret is that there is no secret formula until you create
your own individual pricing formula which is tailored to your
particular situation and the actual cost of making what ever you
choose to make.
If you are serious about turning your hobby or your passion for
jewelry making into a career, or if you intend to derive an income
from it, I humbly suggest you take a pricing and promotion class
from a successful, professional, seasoned veteran who makes a living
by designing, producing, and selling jewelry. Someone who is
qualified by their own real world experience can guide you towards
effectively analizing your studio and production costs, and enable
you to develop a pricing formula and strategy based on your own
individual considerations.
Michael David Sturlin
michaeldavidsurlin.com
I have used some formulas, but basically, look at your work and
honestly imagine a price you would be willing to pay, not as a
maker, but as a person who wants to buy it. Also remember that people
don’t always want what is less expensive, there is a certain respect
people have for higher priced items, they assume higher price means
higher, or better quality. If people are asking to buy them, they
must be worth having, and people are usually willing to pay almost
whatever for what they want. Ever notice how bargain basement places
have the ugliest things for really cheap. Some things no matter how
low you price them will never sell. The same goes for nice things,
sometimes, no matter how high you price them, they will sell. Does
that make sense?
I hope so. good luck
Rickson