Saturday, March 21, 2009
Pricing Handmade Work Successfully
Pricing art and handcraft can be as confusing as reading the small print from your stock broker....no wait....nothing can be as confusing as that. Maybe it's more like parenting- confusing because we all eventually come up with our own unique way of doing it. While my way is not the only way to do it, I'm managed to earn a fair living as an artist, including 8 years as a single mom, so it works for me. Pricing art can be maddening because art is worth what people will pay for it. But if you haven't sold anything before, how do you know what they'll pay for it????
Start by finding similar pieces in places that have a good sales track record. Established galleries, boutiques, or Etsy stores with good sales are great places to look. Note the highest to lowest prices, and find a median price. That should be your Bread-and-Butter price. Price anything that you want to make in multiples, or large sets, at that price.
When the demand for your work at Bread-and-Butter prices exceeds what you are capable or willing to make, raise the price in 10% increments, until you have the cash flow that is right for you. For instance, I want my Bread-and-Butter work to pay my yearly expenses, and leave me with half my workday to experiment, or make One-of-a-Kind (OOAK) pieces. Because I want so much free time, I keep my Bread-and-Butter prices low. That way, there is always a high demand, and I have a steady income stream.
I price my OOAK pieces (experiments that turned out really really good) with the advice of trusted gallery buyers. They live in a mysterious world- just let them do their thing!
My third category of work is samples. These are experimental pieces that are prototypes for my Bread-and-Butter line, and I price them 25-40% below retail. Here are some examples of mine on Etsy.
I said another confusing word, there- retail... I know....the whole retail price, and wholesale price is like trying to pretend you understand your kids' New Math. Galleries mark up your price by 100%- 120%. If you think you can't possibly cut your price in HALF, well, you may not realise how much time you spend selling. I know that I didn't! If you are selling wholesale for the first time, look at raising your retail prices, buying supplies wholesale, and developing production methods. Some combination of this WILL work for you. And set a Wholesale Minimum. Mine is $450. A gallery must buy at least $450 at one time to get the wholesale price. Most of my galleries order $1200 at one time, so I only have to make a few sales a month. $1200 wholesale = $2400 retail, so if you are selling on Etsy, think of the time it takes you to list, pack, and ship that much work, and you may begin to think of selling wholesale as more doable.
The above bean pot is $26 wholesale, $52 my retail (100% markup of wholesale), and $58 gallery retail (120% markup of wholesale).
I wish you great success in all your creative endeavors, especially if you are trying to find a way to make a living being creative. I will answer all questions if you leave a comment.