Sunday 4 September 2016

Why Does Handmade Cost More?

I've just spent the last hour or so costing and pricing some new pieces and after devising a formula the process is much more accurate and much less of a random number plucked out of thin air (thanks to Dan Maier from one of Craft Central's fantastic workshops).

There are so many things to factor in when pricing and I do wonder whether some customers really do understand exactly what they are paying for when they buy handmade pieces.

I doubt very much whether any designer-maker chose this career to make a fortune, but naturally we do need to eat, pay mortgages/rents, bills and have the occasional treat like other people!

I dread pricing, but as I was costing these brooches, I got to really thinking about all the things that have to be taken into account.  So, desperately hoping that I don't sound too preachy, here are some of them.

COST OF MATERIALS
The most obvious and immediate cost for the designer-maker, but there are additional costs for collection or postage of the materials.  My resin legally has to be sent by courier, which is more expensive than Royal Mail. I have to travel to a neighbouring town to pick up my wood shapes and my Japanese chiyogami paper comes from a shop in London.


TOOLS
A basic kit to make each piece gets put together quite quickly, but the cost of tools doesn't end there. Things break or need upgrading and even a good supply of pens and paper for the designing part all cost and all need to be factored in.


LABOUR
In addition to the physical making time, there is also the time it takes to design the piece. Obviously this only needs to be done once before the actual making starts, but it can take me several hours of research, sketching and refining on the computer to get a design absolutely right.


There is lots of necessary behind-the-scenes work spent on the business. Photographing pieces to a respectable standard and uploading them all onto the site (as well as writing the blurb to accompany them) is a major one and takes LOTS of time as I take 5-6 photos of each product from various angles to really show them off to the customer. If I was lucky enough to be able to afford to pay someone to do this for me (or anything else to help the business) then that would cost too. My nearest professional photography studio charges £100 an hour + VAT. Time is also spent on general admin and social media promotion, writing newsletters and blog posts, preparing and packing orders, ordering materials, designing promotional artwork and labelling and pricing stock for galleries.

STUDIO
I work from a studio so there is rent, bills and insurance to pay for my space.



SALES POINT
Whether sales are made from a personal website, a big online one like Etsy or Not On The High Street, a craft fair or a bricks-and-mortar shop or gallery, all have charges that need factoring in.

Personal websites may need to be professionally designed, which isn't cheap.  There are also hosting charges.  My web hosting and online shop platform cost me around £38 per month. Fortunately I can design and update it myself, so I only had to pay a web designer a small fee to do a bit of technical tweaking.


Not On The High Street charges a £200+ fee to join and takes commission on sales. Etsy charges 20 cents to list each item and also takes a percentage of sales. Any site which uses Paypal incurs additional charges on every transaction, so I never get the full price for each sale, even from my own website.

A small space - say 1m x 2m - at a craft fair can cost anything from £50 to in excess of £1,000. There may be additional charges for a table, electricity, lighting and shell scheme (display boards and dividers to section off your space). There is also travel to factor in, possibly overnight stays if the fair is a long way from home plus food and drinks to keep the energy going!

Shops and galleries take up to 50% commission on sales.  It is EXTREMELY frowned upon to put up prices for galleries whilst continuing to sell the same item cheaper elsewhere, so the retail price of a handmade piece needs to be worked out so that all costs are covered by half that amount.

PROMOTIONAL COSTS
Wherever I advertise (with the exception of some social media platforms) costs money. It is essential to let people know who I am, where I am and what I do or I can't make sales. Facebook, once my favourite, will now only show a post to a miniscule number of likers unless I pay money to 'boost' the post so that more people see it.  Thus if I have something important to say, it can cost upwards of £3 per post to give it a decent exposure.

Magazine advertising or advertorials start at over £100 for one month depending on the publication.

Business cards and other promotional materials such as banners also cost to get printed (nearly always leading to gritted teeth time when children scoop up handfuls at fairs because they are 'free').


PRESENTATION & DELIVERY COSTS
So a lovely customer has bought a piece.  Is it labelled and nicely packaged and popped into a box or padded bag?  Has it got a card or business card in with it? Or even a little freebie, like a postcard or a sweet?  Yup, you guessed it - more costs.



And finally . . .

EXPERIENCE
Consider how reeeeeeeeally long it has taken the designer-maker to make that piece.  All the years of practising and all the time spent trying out ideas that didn't work to get to the ones that did, as well as attending classes and workshops to learn new skills and techniques.

In his later years, the artist Pablo Picasso was being interviewed and was asked if he would mind doing a quick drawing. Picasso scribbled something on a piece of paper and handed it to the interviewer, who then asked him if he didn't feel slightly guilty that a scribble that took seconds could potentially sell for thousands.

'Seconds?' retorted Picasso 'That took me eighty years to do!'