How to price your work is a topic that never goes out of style. Do you want to make more money? Do you undercut other stores? Do you want people to be able to enjoy quality work at a decent price? How much do you need to make a living?
In fact, there are as many different methods to how to price your work as there are artists producing said work! And it doesn't just relate to artists; it relates to anyone providing or producing a service or product. This topic came up at a dinner party last weekend because I had just come from a successful gift sale where I had sold every single one of my Tweet ornaments. I brought it up at the party because someone at the sale said, "Well, you priced them too cheap!" and I was thinking, "No, I priced them just right!" I was thinking that the people at the party would support my argument: I would rather have them priced to sell than have them all left over.
I was wrong. I was even a little ganged up on.
Let me backtrack for a second. There is usually a difference for artists on how they sell their work at a gift show versus how they sell in a gallery. At a gift show, you take typically 100% of the take minus expenses and fees for being at the show. You do all the hard work of selling.
In a gallery, you tell them the price you want and then they mark it up 100%. (You have to decide how much money you want to make and hour and look at your materials and time and have a little profit to boot. Trust me, even widgets being sold for $1.99 at Walmart is accounting for extra profit.) OK, so galleries are taking 50% of the retail price because they are paying rent and and insurance and advertising and if they are doing their job, they sell your work too. To me, this is win win because I don't like to stand around all day selling my work. I would rather someone else do that bit while I get to keep playing in the studio. And I am still getting what I need for each piece.
Say I need $6 for a pair of earrings that I sell in a gallery and the retail price is then $12. When I sell those same earrings at a gift show myself or even on ETSY, I sell them for $12. That way I am paying myself the extra for setting up the show and doing the selling and I am not undercutting the galleries I sell in. This is very very important. Too many artists would go to a gift show and sell their earrings for $6. This is bad for business and bad for you. It doesn't look very professional. If galleries catch wind of this and you are selling in their area, they may drop you. And you are not taking into account for yourself the extra work that goes into selling something.
Back to the dinner party. I was saying that I needed $8 apiece for my bird ornaments. And they retail at $16 and they sell like hotcakes. I was informed firmly that I should a)raise my prices and b)value my work for what it is. I do value my work, but I also want people to buy it!
We debated this pretty fiercely for at least an hour. The next day, I thought seriously about my hourly wage to make the items plus the cost of sourcing the materials (it's a lot of serious thrift store and yard sale shopping to find all those tins!) and the amount of time I take to package and deliver my items.
And I decided to raise my wholesale price to $11. Which means they will retail for $22 and I need to raise the prices on my Etsy shop too so that I don't undercut myself. And it turns out it was a good decision because before I got home from delivering the ornaments, she had already sold four!