was: Pricing woven silver chain
Interesting thread. Other thoughts?
What about a value-based pricing model? Up to here, we have a
cost-based pricing, ie. you define your selling price from your
costs and your profit expectations.
In a value based pricing model you try to exploit the acceptable
price range of your clients, ie. your try to get near the upper limit
of what customers are ready to pay for your work.
In such a case, you will eventually end up with the same price if
your work is similar to other people’s work. And if you do really
orginal work, you will find buyers willing to pay a premium
irrespective of materials and costs.
Note here that I said original work, not unique work. Every hen’s
egg is unique, but they are hardly original. The sometimes proclaimed
uniqueness is not a strong argument to most customers, to some
buyers it even disqualifies the producer.
Many kitchen table jeweller’s success is a value based success: The
3 F’s (friends, fools and family) pay an premium because they are
somehow directly attached to the selling person. Avon and Tupperware
have build their entire business model on this effect; garden party
sales put the same emotional stress to buy on the invited person.
If you dare to do so: Up your prices until you have lost 80% of your
customers. You will work less and earn (relatively) more money. Now
up the volume until you reach previous work levels and you will be
rich. Simple, heh?