How to price craft work, business advice for craftspeople.

How to price craft work is probably the single hardest issue for anyone in the craft business whether just starting out and selling the first few pieces or having been running a business for many years it is something we all struggle with.

How should you put a price on your work?

I hope this advice will help you through the minefield and also help you feel better about the price you end up putting on your work.

When I was a kid computers were just coming in, the first very simple computer I saw had a game called “lemonade”. It was all about supply and demand with a few variables thrown in. You were running a lemonade business, each day you looked at the weather forecast and decided how much lemonade to make, next day you were told what the weather was really like and either you sold out by 10am and wished you’d made more or you were left with a pile of unsold stock and wasted raw materials. Many commodities have a simple supply and demand relationship.

The supply curve works like this, if the price goes up supply goes up, in the world say fo potatoes if the price goes up farmers switch to growing them, if the price drops supply drops. Demand works the other way as the price goes up demand falls off. There is a point where supply meets demand which gives us the normal price for the product. This works with potatoes where increasing supply is easy, it doesn’t work for Ferraris, Saville Row suits or unique hand crafted goods because supply is very limited and can not go up.

If supply is very limited then when price goes up perhaps surprisingly demand goes up too. This only works if your product is sexy and desirable or if there are no easy alternatives. so it works say for oil and old art paintings, it may not work for a relatively ordinary stoneware mug unless you can convince people there is something extra special about your mugs. If people really want one of yours then price becomes less relevant  The other key thing to note is that price is always dependant on context and this a key one for craftspeople.

Context is crucial, we all know that work looks better and sells for more if it is on a white cube under a spotlight in a gallery than if it is dumped on an wrinkled tablecloth at the local craft market. Think also about beautiful covetable objects you have bought, whether an apple computer or food from a high end organic retailer. Think about how it was packaged, think about how you felt unwrapping that packaging, think how you send your work out and how your customers might feel when they unwrap it. Will they feel that this is something that you love and value from the way you treated it? A website is part of context, it tells the story behind the object and is part of the brand that is you and your work, it doesn’t have to be flashy, clean and simple is best. The clothes you wear when you present your work are part of context. We don’t have to aim to be apple, slick design type packaging is not appropriate for much craftwork, many of us aim to present a wholesome, authentic image so a nice plain cardboard box full of woodshavings perhaps with our logo hand stamped can present us well. All of this is context and price can not be separated from context. If you want to get a better price for your work then looking at all these areas of context will help.

If you are looking to price a product for the first time or new in business here is a simple way to get a price.
Add up all your fixed expenses for the year and divide down to give a day rate including vehicle, workshop rent, electricity rates etc These are your fixed costs.
How much do you want to earn?
Here are some UK average pay scales based on years experience source

So maybe if you are starting out you could aspire to earn £20,000 and if you have 20 years experience you might aspire to earn £40,000. Divide your wage down to an hourly rate so £20,000 is £10 per hour but you will do well if you are actually making for more than 50% of your working time so double it to £20 work out the time it should take to make the piece add material cost and this gives you the bare minimum cost price you can afford to make the piece for. It just pays your wages and your bills, it includes no contingency and no sales cost.  If all your customers arrived at the workshop paid up front took whatever stock you had and took none of your time this price would give you the wage you were aiming for. This never happens. All sales cost time whether time spent at the craft fair, time spent on the website for mail order or time dealing with retailers or gallery owners. You need to add a significant amount in for your sales cost, I think many craftspeople cost in their workshop time but not the time they spend preparing for and standing at craft fairs, if we did probably fewer of us would sell that way. Some would advise doubling the basic cost price to arrive at sales price and I think that is not a bad idea. If you do this then you are far more likely to hit your targeted wage. It gives you a little leeway when someone wants to bulk buy for resale and gives you the margin to spend a little time getting all those other parts of the sales context looking good, to look after your customers a little better.

People who have come through the arts schools say furniture makers, silversmiths and jewellers are much better at this sort of thing than green woodworkers. We need to be able to offer our customers a great service and we can’t do that if we are always screwing ourselves on price.

It’s important to be realistic however, I do see people just starting out asking the same price for work as well established makers. I spent many years turning out bowls and plates and selling them very cheap just to pay the bills, I don’t begrudge it, that serious production work honed my skills and the work is all the better for it. My bowls are better now and I am spending more time on the context. They are still good value. Like a great pair of jeans or boots they cost a little more when new but they will last for years and get nicer over time. People who go out of their way to find such work do not mind paying a fair price for it. One piece of advice I was given years ago when I was still always struggling to make enough stock to sell was this, “if you doubled your price would you sell half as many?” I was never brave enough to double my price to find out but you get the picture. I did up the price 30% the result was I sold just a few less but took more money and I took a little stock home so it was not such a desperate rush for the next event.

The difficulty many craftspeople have with price is this. You put your heart and soul into your work, when you offer it for sale it is not like selling potatoes or lemonade, it’s not just business, it is more like asking the public to pass judgement on you as a human being. If you put a high price and people sneer it feels terrible but if you undervalue your work that is no better for your soul. The trick is to find a fair price for the work and skill and then to find people who value and appreciate it.

Feel free to comment or add links to other information that you have found helpful on this topic.

I should say part of this advice is based on personal experience, the basic pricing method is from Richard Raffan’s superb book “turned bowl design” and the more advanced branding and context advice comes from Alistair Hughes of Savoir Beds who gave us advice as part of the crafted mentorship program.

Two last titbits from personal experience; if you make a piece that you think is just that bit better than the rest, do not feel you have to put the same price on it as the others that took the same time, it’s OK to put the price up, if someone else likes it too they will be happy to pay the bit extra and you can compliment them on their clearly excellent taste. If you have something you like so much you don’t really want to sell it then crank the price right up, you may find someone that loves it and buys it and you will both be happy, if it doesn’t sell it’s nice to have it around, it elevates your other work. If you make things in standard production runs and one of them just comes out as the best example of that type you have made so far, pull it out and don’t sell it. Keep it as inspiration for the next batch until you can make them all that good or maybe even better.

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17 Responses to How to price craft work, business advice for craftspeople.

  1. Ren A June 16, 2013 at 1:53 pm #

    Great article, that makes so much sense. Thank you for taking time to put it together.

  2. jarrod June 16, 2013 at 2:15 pm #

    Good stuff to think about Robin. I've been though this many times over and still learning or adjusting and I know you know this. Another factor that has an effect is the demand for craft items and it's value within a certain market. It's fine to set our price with the factors you talk about, but let's say with splint basketry, April, my wife is competing with huge box stores,or import retail shops that sell this handmade item for a few dollars. This is the overall basket market. She does sell her baskets within a different context, and a sub market, but it would be pretty hard to make a living just selling these baskets at the price she would want to make per hour. There are just too few of people within the market she is selling in. I believe and I know some would argue, but the price does have a limit that is linked within the market you sell within, and that market has a certain demand. If she wanted to sell within the market that would pay her a wage like you suggest she would have to be within a huge national market that consists of collectors. Which is possible, but not something that one just gets into within a year. This market takes years to get into to. Often times getting featured in a home decor magazine or the like. Beginning crafts folk sometimes try to start too high without taking in these factors, you can set your price to whatever you want or need but it does not mean you will sell them or the quanity one needs to make a living. That takes time and experience to learn how and to which market you need to be selling in to actually sell enough. I think perhaps moving through different markets as we learn and fine tune our skills at creating our items and selling, is fairly realistic and a common method, this includes selling things cheap as you say. Over time we learn and grow and in turn end up moving into a different markets for our hand made goods. Another point I think about is historically craft folk were very low class, but their lives were filled with hard work, which helped make them healthy and happy. Often eating food that was viewed as simple, but actually was far healthier than the expensive processed foods. I tend to value my family time and also my flexible schedule as worth something like $1000 per hour. I carve spoons and sell them for $25 each so I'm making $1025 per hour per spoon! My bills get paid, but their is more to life than the bottom line. I know you know this as well. I just had to say it. I hope what I wrote makes sense. It's a subject that deserves attention and discussion.

  3. privatepinstripe June 16, 2013 at 2:36 pm #

    I have always said ; that the experience of receiving a product, is as important as the product itself.http://www.hatchetandbear.co.uk/product/p-p

  4. Robin Wood June 16, 2013 at 9:43 pm #

    Thanks Ren and PP glad it was useful. Hi Jarrod, I for one would love one of April's gorgeous baskets, if you have room in the pack when you come to the UK I will buy one. There is of course a limit to the price that folk will pay within a certain market. I was turning at a village show last weekend and I simply do not put work out for sale because I don't want to embarrass the folk asking how much it is or myself. I know they are not going to pay what it is worth.I personally am no fan of the "collector" market. I dislike the ego driven art craft world and prefer to make work that will be used rather than treated as an art object. There is in the UK (and I am sure the US) another world, the luxury sector. This is the world of handmade shoes, bespoke suits, vintage wine, the people who buy these things want excellence and are not price sensitive. They appreciate the work and use it and having paid serious money for it they value it. Think how you feel when you save up for a wonderful craftsman made tool, there will be people out there that feel that way about baskets, you only need to find a few hundred of them a year from a population of 313 million. Of course most folk can't afford or choose not to pay properly for April's work not many folk can afford to have a hand made suit either but as David Hieatt said to us at the HCA conference. "If you are making gold, make sure that you are not selling it as silver". Most people are not in the gold market but that is no reason to sell gold to them at silver prices. Our job is to find the people who are looking for excellence and make sure that our work is correctly presented.

  5. Will Simpson June 17, 2013 at 3:19 am #

    Great stuff to consider. Robin, you and Jarrod bring up some great points particularly around buyers being price sensitive or not. It has always surprised me that even craftsmen can be inconsiderate when considering a craftsmen's work in different media. Sad. But is is even something I have to watch in myself. Robin, you mention that some craftsmen price their work as if they are in the journeyman or master stage of their craft even though they are just starting. I plead guilty. I have been carving spoons since 2008. I still feel very much a beginner. Jarrod, sells his spoons for $25, I have been selling mine for $29. Now seems I'm a little vain given his skills and my inexperience. I'm going to adjust my price. Maybe I'll sell more and have to make more thereby developing my skills and getting better and being able to increase the demand.One advantage/disadvantage to having a higher price is that I don't have to make so many spoons. Fewer customers but the customers I have are not price sensitive.

  6. Robin Wood June 17, 2013 at 8:38 am #

    Will I would not necessarily say someone earlier on the road should sell for less. Profesional craftspeople often bemoan amateurs selling for the cost of the materials and creating a false impression of what the price for craftwork should be. It is a difficult thing to do but if you were to put your work alongside a good piece of professional work if it is as good then sell it for a similar price, if it is not then up there yet then sell it for less. There will always be people who will buy based on price and there will always be people who have a great eye for choosing the best and are prepared to pay a little more. We tend to easily get disheartened if we only sell in one context which is price sensitive. If Alexander McQueen had tried to sell clothes at the local craft fair folk would have thought they were bizarre and ridiculously expensive.

  7. Nin June 17, 2013 at 10:00 am #

    I enjoyed this article and its timely for me since I know I've been screwing myself on price for some time….also have to mention that I remember the lemonade game!

  8. Sounds from the Heart June 17, 2013 at 6:15 pm #

    People with less making experience should not keep their prices down in respect for expert. If they can sell for a higher price then the expert also needs to put his prices up. If the journeyman puts on a high price and fails to sell it makes the expert look good. Every maker should value their work, anyone making original work should value the art as well as the craft.You say time is usually halved by non productive workshop activities. i tend to agree with the Crafts Council who suggested that in running a business only about one third of time is really productive. Thus treble your needs for contact hours, then double them again at market. It sound ridiculous but any other way is the road to financial struggles, such as most craftsmen live with.

  9. Will Simpson June 17, 2013 at 10:12 pm #

    I am but a simple maker. If my spoons look traditional, it is only by accident. Selling spoons is local. People who buy my spoons will likely never hear about the spoon makers Robin, Jarrod, Jogge or probably any other spoon maker of note. Context is important.I read somewhere that each day is worth a $1000.00 and to sell a spoon for $25.00 makes the day worth $1025.00. This is good conversation. I understand the supply/demand formula and the need to account for "cost of sales" but I so slow that using the formula would make the spoons I do make unaffordable. I really like the idea of pricing the spoons so that they move and I have to make more. As the joy is in the making.

  10. It is hard and i've just recently started selling at a price that doesn't make me embarrassed. To people that are asking about this then they are probably not really serious about their craft or art. you need to be putting out so much for so long that you learn all of this on your own. you sell for as much as you can. price it high and keep lowering it until it sells. now, some types of work just have too much time to ever get your worth in dollar back unless it's in a fine art gallery. Robin did a post a while back on a clog maker who talkes briefly on this topic and this guy is amazing at what he does. He also is missing teeth and is forthright in not being able to turn out work fast enough or not being able to make enough. Making 20 pairs of shoes from hand is not like turning 20 bowls in one day. That's the way the cookie crumbles though. You better be in this for the love. You better have to do it or you'll never get anywhere anyway. We live in a time of individualism and everybody want to make their own art and start their own business. This kill the market for crafts and arts. The people who used to be support the artists now spend their money playing artist. If you really want to make your love your living you need to dig in and relax. For me, it's nice, being humble and simple is a way of life. when things get crazy in life i don't fret. i tell myself, hey' it's okay, i've got wood and i'm gonna carve until i die.' and for some reason it makes everything okay. any pricing or business will sort itself out through consistency and persistance. everything in life changes but not the simplicity of doing what you enjoy doing….sorry for rambling and ranting.Robin, thanks for sharing your life and thoughts, as always.

  11. Minouche June 28, 2013 at 11:03 am #

    I just stumbled upon your blog when looking for green woodworking courses.Great advice about pricing craft work, thank you!I've come to realise that justifying realistic price tags to people who are used to buying mass produced goods is a waste of breath. Getting my work to the people that will value it, that is the challenge I'm focussing on!

  12. privatepinstripe June 29, 2013 at 11:32 pm #

    Really like what Daniel Moore Allen says!

  13. primitivecrafts June 30, 2013 at 4:34 pm #

    Breaking into the business of selling crafts is hard enough without having to worry about pricing as well. As we are constantly hit with a barrage of mass produced items that are sold cheaply, it is often too easy just to price the things we make even lower. Just searching for hand carved spoons on ebay, etsy, etc gives such a huge price range, it's hard to see if and where "we" fit in. Robin's post helps to cut through the minefield a bit. Thanks Robin

  14. Graeme December 2, 2013 at 4:16 am #

    Excellent advice Robin, but there is another consideration that farmers understand. There comes a time when a decision has to made whether to plough in a crop or sell it at a loss. The argument goes that if you can recover the cost of harvest, then harvest it and hope for a better season next year. With crafts, if you’re starting out, you’re not only competing with the established but with the hobby crafters clearing out the basement for christmas cash etc. There may be times when it is necessary to sell way below what you want just to get cash and make room. I don’t mean dump it through your main outlet or over the internet, but sell through nearby fairs, fetes, markets etc. at a cost recovery price (the cost of selling and materials) and keep the best items for a fair price.
    I’m also not a fan of the old Supply and Demand curve. That model is why there are always people who can’t afford decent clothes, houses, medicine and aids such as glasses and hearing aids, even in prosperous countries.

  15. kiko denzer December 8, 2013 at 7:30 pm #

    “Like farming, art succeeds or fails not according to the number of carrots and potatoes you pull out of the ground, but according to the fertility of the soil and the health of the community. When the soil overflows with fertility and the community overflows with health, all products become gifts and exchange becomes celebration.” This is from an essay at http://www.theworkofart.org/content/making-money; Lewis Hyde’s important book, The Gift, also puts this discussion into context. Trade begins with an understanding of exchange rooted in the knowledge that all of life comes to us as a gift, which suggests that our obligation is not to make money, but to make sure that the gift can always move. I have a friend whose career goal was to be able to do the work he loved for free. That comes w/it’s own set of challenges too, but it’s good, I think, to consider the question from an angle completely opposite to the current consumerist mindset.

  16. Roy Davi December 29, 2013 at 12:17 am #

    This is a conversation that I, friends and family often have and the obvious solution is always forth coming. If any object speaks to you of it’s own beauty then a price will follow. Time and again this happens as I see other peoples work and think of the skill and soul put into the piece. The stools and seats I sell at markets and festivals in Australia are varied in character and attract different comments fromthe people who watch as I demonstrate pole lathe turning. The novelty of this act is a definite draw card to those who come to the many market events in the Blue Mountains and Sydney surrounds.
    Setting an affordable price even when there are few people to ” compete ” against, is difficult, but I try to put a base value on my time then add extra, which I call my incentive gape price that will allow me to cover consumerable costs and allow for my passion for creating craft that others an I appreciate to continue.
    I look at each piece that I craft and decide how much I would pay. This is where I started 6 years ago and have adjusted prices depending on interest in my work. People will generally recognise effort and the embodied “love” as they see you working on a piece of raw wood.
    There is no substitute for experience.
    People either look for a discount or just stand there and wait till I finish a fiece of work and pay .Often the comment comes that my prices should be higher but to me it was a fair price having considered time and energy for that piece. This is not to say that some of my work is not expensive as it is to some folk but not to others.
    In the end set a price and gage interest. At some markets few items sell then at another stock vanishes at set price.
    If anything I have been embarrased by prices being low on my best items and people coment that more would be appropriate, so I did move my price up on a few better items and they sold easily.The right person will one day see the value in an object and both of us will smile as a good home will have been found for a cherished crafted item.
    So Robin why not put a few bowls and their realistic prices on display, people will generally conseed that a price is far considering the effort and skill attached to what is being made.

  17. Steve Schuler December 31, 2013 at 5:40 am #

    I’m glad I ran across this discussion. I’ve been doing spoon carving and other woodwork as a hobby for a few years now. I mostly do it for myself and my family–plus, a set of handmade wooden spoons makes an excellent gift, and it costs me little more than time. But when I first began to sell my work here and there, I couldn’t make any of the usual calculations of consumer demand, production costs, and profit margins work for me. I wasn’t trying to make a living at it, and my shop costs (electricity and whatnot) are my housing costs. I just wanted to find an outlet for some of my better work, and perhaps pick up some spare cash for new tools here and there. For hobbiests, the calculations can be quite simple.

    What worked for me was taking an honest look at comparable products in a comparable market. I did a lot of looking at price tags, both in person and online, and that gave me a pretty firm idea of where my work fit into the market. I had no desire to grossly undercut the dedicated professionals, and I was determined not to sell myself or my work short. But I also did not want ask top-dollar for my work, which might make it seem like I thought my work was of the highest quality–it’s not. So I settled on prices that were just a little bit below what I honestly thought were comparable products on the market. This has worked reasonably well for me. The products sell at a rate I can keep up with, and they remain affordable for regular, working people who would like to spend a little extra on something well-made. A few items remain unsold, but that means I can keep a small stock of products on hand for those weeks and even months when I have little time for woodwork.

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