It seems that lately I’ve been hearing about a lot of people who are struggling to price their products. It’s been a topic of conversation over at The Creative Empire. I’ve gotten several requests for the Pricing for Profit workshop. And I know it’s an area of your business that many of you don’t feel confident about.
So I’m working on a new solution to help you with your pricing problems. (The online workshops really weren’t ideal, because they were time specific and didn’t fit in a lot of people’s schedules. And I want to help as many people as possible price their products effectively.)
But before I finish putting everything together, I want to make sure I’ll be answering ALL of your pricing questions. So please share in the comments, what are your questions about pricing?
Where do you struggle when it comes to pricing your work?
My biggest concern with pricing has to do with raising prices. I know I NEED to raise my prices, but at the same time, I’m terrified of scaring off the customers I already have. How do I reconcile this?
I’m in the process of preparing to go freelance in the new year. I’ve worked full-time for an agency for almost four years, so I have a very clear idea of what my hourly rate is going to be. My biggest struggle as I come up with pricing is how to charge fixed rates (web packages, logo/identity packages, print packages, etc.). I know I can always look online and try to find other peoples’ pricing for inspiration, but I want to make sure what I charge reflects my style and work abilities instead of someone else’s.
Are there any formulas for coming up with fixed rates? Or is it more of a “go with your gut” sort of situation, do you think?
What exactly is a “fair wage”? I have a terrible time figuring out how much to pay myself.
Wholesale. I’ve done consignment only up until this point. Now, I’m a bit scared that I might either undersell or overprice my wholesale pieces.
I’m with Melissa, I have a few customers that I’ve been working with for years, that I’ve always undercharged… how do I start to ask for more? Especially the non-profit I work with…
Also, I’ve expanded my design business into letterpress printing as well. Coming up with an affordable price structure is really challenging. Plus I keep feeling the urge to give people a deal b/c it’s something that’s still somewhat new to me- even though I know my finished product is professional.
My product materials are expensive to begin with and each product can take 10+ hours to complete. When I use the traditional method to determine my pricing, the price comes out VERY high. I’m afraid that if I price my work this way, to cover by costs AND make a profit, no one will buy because it’s just too out of reach for most. How do I find the balance when so many others in my field are pricing so low (I don’t know how they’re staying afloat). Right now I’m pretty much selling my goods for the wholesale price, not the retail price, just to get some money coming in. Also, should custom work be sold at a higher/lower/similar rate?
I’m a fine artist who sells both numbered and unnumbered prints. I have the prices for my numbered prints set at a nice rate that I feel comfortable asking for and people feel comfortable giving for the piece. I may raise prices in a year as sales of those increases but my biggest pricing conundrum comes to pricing unnumbered prints. It only takes me a few moments to print and package on of those and I certainly can’t factor in the 36 hours or so it takes to complete the drawing for each unnumbered print (although I do that for the numbered prints). So far I’ve looked at the top print sellers on Etsy and set my prices according to theirs. But I actually feel that those are a bit low. So my question is: Do artists have a different formula for pricing prints? And is it all right to charge more than the top sellers?
What I struggle with is, most of my work is probably underpriced and it still is not selling much even at that price point. I have a hard time thinking about raising my prices and thus putting another barrier in the way of people who might want to buy. I have read before that if you’re not selling, you should try raising your prices so that your work has more perceived value, but that seems really counterintuitive to me, in this economy. I tried raising my prices in my Etsy shop on several occasions and saw no difference in sales at all. (Sure, people might think my work has more value if it’s more expensive, but if they’ve only got $20 of fun money left over after bills that month, then I’ve lost the sale.)
I do hand embroidery-completely. I don’t own an embroidery machine, so all my work is done by hand. The problem is that then I need to charge higher prices compared to other available work. On Etsy, when I run I price comparison, I often find more complicated works being sold for an equivalent or even lower price then I feel I can afford to charge. I need to know how I can keep my prices high enough to support myself, without driving customers to the cheaper, machine embroidered products.
i’m also wondering about the best pricing formula or strategy, and how you justify/explain the high prices.
I struggle with to charge. I signed up at the Creative Empire about two weeks ago with this being one of the main things I needed help with before I could more forward. I try to be reasonable but my time is worth something. My prices are lower than others on Etsy by a few dollars but much lower than others on the web. I always feel like I have to justify my price and find it hard to turn people down when they ask for a discount. I should note that I get plenty of sales, sometimes more than I can handle. I am having my site redone and am thinking relaunch time (post Christmas) would be the perfect time to raise prices but I have no idea how to decided by how much.
I can’t seem to get the balance right between what I need to sell it for to make a decent amount of profit and what people are willing to pay for it. I’m starting to feel like my product isn’t good enough, even though it’s far superior to what’s of the same style in retail stores and is a similar price point.
Should I have less price points? Instead of pricing baby slippers at $28, 32, 34, 38, 48, adult slippers at $52, 58, 64, etc, should I just pick 2 points per group? I like to keep the $28 price point for online customers, but one (of the 2) shops that sell my slippers does not price any that low.
you’re answering my prayers with your question 😉
it seems to be asked quite a few times, but again as a knitter (which takes time) i find i cannot charge for the time so usually end up guess-timating which is not great. having said that, i refuse to play the Etsy game and lower prices for my work because others have lowered theirs. that’s counter-intuitive (and thanks to your posts as well, has given me the courage to do that) – but its a balancing act, you don’t want to lose the sale, but don’t want to work for free. i’ve now set up my own shop and believe i have the freedom now to charge a fair price, the question is what exactly should i charge.
looking forward to your insights.
Great topic! I have both comments and questions.
My latest revelation is that I don’t have to offer at wholesale everything I make. Sometimes the numbers work out and sometimes they don’t. Some times an item is too costly to make to be able to lose half to a retailer and still be affordable to customers, but it’s great margins when I sell it direct (on my website or at fairs). This lets me continue to make and offer some of the items that are expensive to make but very close to my heart.
Context is also SO important for pricing. The atmosphere and design of online sales or a brick-and-mortar shop can hugely affect value perception and what people are willing to pay. People never simply buy isolated objects; they are participating in a whole world by purchasing something. And we can help paint and curate that world.
I wonder if it would be totally crazy to just do a post on a facebook page telling friends and fans that we can’t pay rent and gotta raise the price of such and such $5. And just ask them if they’re going to stop buying the item. We could even include a photo of the front of our apartment building, etc. Perhaps it would be interesting to take a very personal, transparent approach? People can be surprisingly empathetic in the face of openness and honesty. Maybe we can get playful and creative with this potentially scary task.
Cheers!
I have a hard time determining all of my production costs. I use a lot of salvaged materials as well paper and fabrics that I’ve been collecting for years, so it’s really hard to say what my materials cost is.
I listened in on your Crafting Your Wholesale Strategy webinar this morning through Beckman’s and really this is where I have the biggest problem. So I wandered over to your blog to check out what you had to offer on the subject. I’ve read Craft Inc and read different people’s formulas for pricing but still feel slightly lost.
I think where I struggle is between trying to be competitive in the retail craft market while making money at my wholesale price. I have been trying to figure out how to transition out of the craft shows and into more wholesale shows. I only do 2 per year for wholesale and at least 10 retail.
Also now that the silver market has gone up so much that’s another area I am unsure about when to raise my prices or how much to build in to my prices to begin with to allow for the market to go up and down.
I want to cover materials, labor, overhead and make a profit.
I started my business right when the economy started tanking so I did a little too much of lowering my price point and I don’t want to do that anymore.
I know that this post is quite old, but my question still applies. I was just wondering if you answered all the questions above and where I can find them… I specifically fall in line with Studio MME.
Thanks!