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BUSINESS: Pricing Your Handmade Goods
Today, Larissa Robinson-Joice of www.giggleicious-photography.co.uk covers that age old topic of "pricing"!
When I started my business, one of my biggest hurdles was how to price my goods. I spoke to my friends and family and they all said different things. Eventually, I stumbled upon an article I found written by a lady in the US named Mary Pagel-Boyd who makes handmade leather goods and runs www.ohboydenterprises.com. She had written about pricing your wares and what I read struck a chord. Her basic principles are:
- You ARE a business person, no matter what your craft and should organise yourself as such.
- You should pay yourself NO LESS than the minimum wage and this should be factored into the prices of your goods.
- Factor in the WHOLE cost of making your goods; both waste and used materials (such as off-cuts), shipping (to you), your tools and equipment costs, rent, repairs, phone, internet, website costs, electricity, advertising and office equipment. (You will need to make educated guesses with regard to utilities, especially if you work from home.)
Once you have a total this is your wholesale price. Your retail price should be double this as this takes into account retail mark-up. At this point, I can hear cries and shouts across the land of “I’ll NEVER sell my goods at that price!!”
If you are trying to make a living from your craft you have a few obstacles to overcome:
- If you have ever done a craft fair or tried to sell your items in independent high street stores you may have heard “Oh that’s too expensive” a number of times. The two biggest hurdles faced by those trying to make a living from their craft are: crafters who do not need to make money from their goods; and the general public.
- Craft fairs are often peppered with designer-makers who are not there to make a liveable profit. It’s a hobby (that’s not to say that they are any less talented). These crafters tend to price their wares to sell easily and to undercut any competition.
- In addition, nowadays supermarkets and chain stores are full of cheaply produced goods which might, at a glance, look similar but are made in bulk with no love, care or individuality.
These factors combined work to devalue what we are trying to do as designer-makers. There are people, however, who do realise the value of handmade goods. These people cherish the craftsmanship, design and care that go into a speciality item and realise that this makes the item worth so much more than its mass-produced comparison.
These are the people I call my customers and my target audience. Unfortunately, there are still many people who don’t see the value in handmade. It saddens me that someone would be shocked to pay £20 or £30 for a beautiful handmade baby blanket but would happily go into Mothercare and spend £40 on a mass produced plain blanket with no qualms at all. It is our job as designer-makers to re-educate those people.
Such re-education won’t be easy but if we, as designer-makers, don’t value ourselves and what we do then we will forever be regarded as people who potter in our craft sheds on the weekends and not the talented specialists that we are.
This article was originally published in the Summer 2009 issue of UK Handmade Magazine.