Friday, August 5, 2011

How much should I charge?

That's a question that I keep asking myself.

My answer? I don't know.

But I've come across a few tips and quotes that have got me thinking.
BUSINESS TIP ~ When pricing products I think it is really important to 'honour the effort' What I mean by that is that work out how many hours you are putting in & make sure you are adequately compensated for this. If you can't charge for your time- then decide is this a business or hobby. If you are enjoying what you do and it is a hobby great but if not make changes as there is an 'opportunity cost'. Your time could be spent more productively in your business.... Kim ♥
This tip is a hard one for me because it can take me a couple days to make on product depending on the detail involved of course. If I pay myself $10 per hour for my time, one item small product could be as much as $100 and that's not even including my costs!

These days, people want cheap, they don't seem to mind that the $5 earrings they bought will probably break  next week. I do understand people's thinking here as I have thought this myself. We don't have money growing on trees so when I do have to buy something, I buy on special, second hand or I make it if I can.

Since I have started making mobiles and other bits and bobs by hand, I have really started to appreciate the work of others.

I know I probably undersell my stuff but I don't want to scare customers away either. But here's another thought that got me thinking:

I’ll let you in on a little secret. I nearly doubled the price on a popular ring in my Etsy shop. I did this over the course of six months because I couldn’t keep up with the demand. Did I sell less of this item? Yes. But I spent less time laboring at my workbench and made the same, if not more, profit. If you can’t keep up with demand that might mean you’re undervaluing yourself. Sometimes we are so focused on number of sales (I’m guilty of this, too) that we forget about maximizing our profits and valuing our time. I found that my design became a real treasure to those who were purchasing it. In fact, my buyers were now investing in the ring as an engagement ring — giving it the value and meaning it always deserved.

It's an interesting thought for sure. I'm only starting out and learning lots along the way. I will win some and I will loose some. I will get some right and I will get some wrong. At the end of the day, I would love for this hobby of mine to become a fully fledged buisness, God willing. I will end with this quote:

Give Your Voice Value ~ One very important element we often forget to factor into our prices is our unique point-of-view as artists, creators, designers or knowledgeable collectors. Why wouldn’t our buyers be willing to pay a little extra to own something special? Something we’ve been pondering and perfecting for weeks, months, years or decades. Your incomparable voice is the culmination of your creative life: your education, research, travel, dreams, personal experiences. This is valuable, so give it value.

What do you think?

<3 Nicola