Friday, July 1, 2016

That Tired Inaccurate Formula

When I started weaving as my job, my career, lo, these 40+ years ago, the prevailing wisdom for pricing was that you trebled your material costs.  

At that formula, this scarf ought to sell for $15.  

While I may have paid about $10/lb for the yarn in this scarf, that price is not a true reflection of the material costs.  I happened on a bargain for yarns that would have cost me a lot more if I had bought them from the supplier in the U.S.   By the time shipping and exchange rate and duty was added to the yarn it would have cost at least double that.  So, even if I trebled that amount, the sell price using that tired inaccurate formula, my selling price would be $30.  

Even if I used that as my wholesale price, doubling it would still only bring the selling price to $60.  

But no where in that pricing formula are my overhead (those costs that continue every month regardless of what you do or do not do), my labour, the additional expenses of things like the wet finishing (water, soap, electricity to run the water/dryer/steam press), the dry finishing (which takes as long as the shuttle throwing to weave the scarf), the cost of booth fees and travel to other cities.  Not to mention my years of study, my skill.

So, no, I won't be selling these scarves for $60.   The price will be more like $100.  And even at that, they will be a bargain.  Even if I do say so myself.


Peg Cherre said...

When my business was making jewelry from gemstones, that formula worked pretty well for a pair of earrings or a simple bracelet, as my labor involved as nowhere near as long. Once I started weaving the formula went out the window. It's hard to know what to charge, but I have to make it worth it. I should charge more than I do, but I'm better than I used to be. ;)

Stephanie S said...

I think about $100.00 is the going rate for handwoven scarves now. A little less for a smaller scarf, a little more for larger. I still think that's too low. But $100.00 is a psychological barrier for the buyer. Maybe I just don't work fast enough!
Stephanie S

Rachelle said...

Unfortunately hand crafted items are still undervalued by so much of our culture, I blame cheap machine made imports that make people believe everything should be that sort of pricing.
I just put a hand knit beaded shawl up for sale at our local area's shop for $190NZ, that doesn't reflect my hours of work in any way, but it's below the $200 mental barrier and the shawl isn't one I'll ever wear so I may as well get something out of it (I'll get 45% as I don't work in the shop). It's also a price that's not too far off what the other contributors are charging. I am planning on putting weaving up for sale at some point as well, but have to reach the point where I'm happy enough with my weaving for that to happen. Some of our members think it already is, but not me.