UK Handmade

Supporting and promoting the best UK artists, designers and makers

Hello all,
Now my craft fairs are out of the way I am starting to focus on the next issue of UKHandmade (getting in early!) and I am going to write an article on 'how to price your goods'. I have a formula for pricing my goods and am wondering how you price yours?
I know some people are very private about their pricing so I am asking if you would like to reply if you could send me a private message here. All replies will be in the strictest confidence and will only be used in the article if permission is given.
If you use a formula then examples of how you reached your price would be great. Do you have a wholesale and retail price? How are your prices received when you try and sell in shops/craft fairs, do you have a target market...and anything else you want to talk about?
I have never asked this question of so many people at one time so am very interested to see what answers I get.
Thank you in advance!!
Larissa

Views: 588

Reply to This

Replies to This Discussion

I'll be totally honest and say that I don't have a formula for it -- i'm crap at everything to do with numbers and working stuff out so -- firstly I work out the cost of the basic bits used for what i'm making. I then think ... what would I pay for it in a shop and... what am I happy to be paid for it taking into consideration the work and time that went into it. That's it!! I'd rather sell less for more money than more for less money ........ the painting is time consuming sometimes. So that just about sums me up! chaotic, haphazard and not very professional!!! Its hard to access how long it takes me to make something as every thing is punctuated with getting up to make meals for kids, pick kids up from school, dash to the post office, hoover ... I never sit down start something and finish it without getting up to do something in between - especially as the paint has to dry between coats or layers.
Hi
I time how long it takes me to make something and then work out the time cost based on what I want to be paid per hour. I then cost in materials, packaging and selling fees. If the end price isn't very competitive I look at ways of reducing costs such as making things in batches.
I don't have a target market, well I suppose I do , it's someone like me! I make things I would buy for myself, it's the best way to approach things generally, you have to be true to your own creativity.
I'm don't really have a retail and wholesale pricing structure. When I have supplied wholesale it has been negotiated based on the quantity being ordered, that's really not great and something I need to address, but I am happy selling direct and that keeps me busy enough!
Mine is a difficult one, because everything I make is hand sewn. I don't pay myself by the time I take, it would get too expensive!
I take into consideration my materials, the fact that my stuff is unique, hand sewn, what I would be happy to pay for this if someone else had made it ,and somehow arrive at a price!
I could really hasten things up if I used a machine, I know, but I love hand sewing and this is one of my trademarks.
I don't have a formula. I find pricing very difficult as I'm making jewellery and craft items from recycled materials and this someone will look at an item and think 'that's just a load of buttons' - but then I've taken the buttons, added a bit of imagination, creativity and skill and make them into something nice and that's what I think they're paying for. I get a lot of donations so find it difficult to base prices on the cost of materials and so just think about the silver plated wire / findings and bits and bobs i do have to buy to finish things off. I'm terrible in that I haven't kept an eye on what I've spent this year and I've not made much money either, so I doubt there will be a profit at the end of it. going to try and do better next year on that front. But as for pricing. I spend a lot of time looking online at other people's work and see how much they have priced items at and then compare theirs to mine and come up with a few figures. i then look at the range of work I have and form a pricing scale based on the materials and time it takes to do stuff. But I also have to consider what people would be willing to pay for an iem too and that then has a bearing on prices too. I would love to have a formula that would make things a lot easier. i would also like to be a bit more confident about my prices and get paid a fair price for the time it takes to make things....so any tips that come out of this discussion will be duly noted.
Thanks for all the replies!! Would love more please :) But remember you can reply privately if you want to!!
I price my work the same as Louise, by timing how long it takes me then paying myself an hourly rate and adding on the materials cost.

I have made some items that I've really loved, but because they have taken me ages to make, the price I would have to sell them at is ridiculous. I've saved these ideas as personal ones that I can give as presents to people! Or I look at simplifying the design to make it more profitable.

I do have some items that take me hardly any time at all to make but can be sold for more, so I generally give myself a better rate of pay on these items so that they are in line with the rest of my products and the market in general.

I do sell a few of my bits wholesale at shops. I don't make as good an hourly rate on this, and the items are usually sold for more in the shops, but I kind of justify it in the fact I am not having to do the selling and it is a good marketing tool of getting my name out there.
hi larissa- i dont price up mine like this because even less people would buy! but at college we were told cost + £14 per hour, dont know how many people would price it up like that but its what we were advised......that was in 1994!!!
Hi.
My products are much smaller in price than all of you have been discussing - hand finished greeting cards, but I do also produce prints and pictures. I made a decision 10 years ago to supply trade because it suited my family life - no weekend fairs and only away at trade fairs for a total of 4 weeks throughout the year. So I researched the handmade card world in the shops and decided to price mine just a little bit lower. The standard mark up for shops is 100% + vat. I knew what end price I wanted to achieve and therefore could work backwards to work out my realistic trade price - not a lot, but actually quite do-able when I re-thought some of my methods!
I also needed to cover the cost of the trade shows in this price (the cost of these is now around £2000!). So I knew that I needed to do volume sales. And that's what I've been doing ever since. I have good years and not so good years, but I'm still there, and it seems to be working. I also sell directly, but at my own recommended retail price so that I don't undercut my shops.
For everything I do I total up the costs, including heating, lighting etc and adding on some marketing costs, add on a small percentage for myself. (Heating, lighting, marketing etc is calculated by the annual amounts divided by the sort of quantities I aim to sell in the year)
If this total makes the design go over my desired RRP, I ditch the design or re-think it. I'm quite ruthless. I don't think this method would work for a lot of handmade products, but it might help someone.
For some new work that I'm playing with at the moment the prices will be higher because they will not be available to the shops, only for customers buying direct. I don't intend to be doing these pieces in volume. The methods of reaching a price will be the same but will give me a higher hourly rate of pay.
Back in the 1970s craft magazines were full of how to set up a craft business and price your goods.

The advice was always calculate your materials/ingredients costs, add labour costs - then double it, This would then cover all overheads such as heating and lighting and also the cost of paying someone to help out if you were not well.

Then you have to consider whether you're going to sell to shops. The average craft/gift shop will almost certainly double up (in order to cover their running costs) and if you're selling in the same location it's not good policy to undercut your customers.

Simply "covering he costs" is not going to help anyone.
Tina said:
hi larissa- i dont price up mine like this because even less people would buy! but at college we were told cost + £14 per hour, dont know how many people would price it up like that but its what we were advised......that was in 1994!!!

If I charged £14 and hour that would make a bunch of fish around £45.00!! I guess my prices based on what I think someone would pay versus what i'm happy getting for the time involved. I'd rather sell less for more money than loads cheaply and be rushed off my feet painting.
in answer to jane above .

Gosh this is hard - your stitched things are amazing!!!!! trouble is that you are producing gallery quality stitchings which deserve that sort of price tag - totally deserve the £500 BUT that puts you a bit out of the handmade craft marketplace. There is a point where someone's work becomes more of an artwork - such as these stitched pictures - you would buy one as you would a painting therefore you need to market them accordingly.
But I digress - I think the price tag is a correct estimation and you are certainly working it out in the 'correct' manner - my husband is always saying 'but how much are you charging an hour for your time?' - but my time can't be added onto a wooden lizard because that would make it far too expensive for what it is, which is a painted lizard-shaped piece of wood - you might pay a tenner for one but you wouldn't pay £30 which is what it would work out to be if priced properly!
This is a really hard one isn't it? I find the problem is dependent on where you are selling. I make more 'profit' if I sell things direct but then I don't sell much in quantity. I sell some things in a lovely shop near me and their mark up is around 60% (!!!) so you have to think about what the finished price in the shop will be and whether anyone will buy it which means you have to take less for it, but then again, I sell more volume that way - so it's swings and roundabouts I guess!

As far as pricing is concerned, I suppose I have an 'organic' approach - i.e. go with the flow. If some things were worked out on hourly rate then they'd be too expensive!

On the other hand it does kind of annoy me when people make things and sell them so cheaply because it does not reflect the work that goes into things. I've seen people selling handmade bags for £3.50 which I don't understand.

I suppose my philosophy is that if someone really loves it and appreciates it they will pay a reasonable price - I know I would, so I guess I play it by ear.

Sadly though, I have to have a 'proper' job as well as I could not live on what my handmade items bring in.

I agree with Jane. I think the best thing is to make some smaller things that can be done in batches and more cost effectively and then some more expensive items that are more 'luxury'.

Not sure if this made sense or was very helpful but hey!

W

Reply to Discussion

RSS

Book Shop

© 2014   Created by Karen Jinks.   Powered by

Badges  |  Report an Issue  |  Terms of Service