Pricing Handmade Jewelry Too Low

by Rena Klingenberg.
(Home Jewelry Business Success Tips)

(A pretend jewelry ad I created to illustrate our discussion.)

Many artists make the error of pricing their handmade jewelry too low.

Often it’s for one of these reasons:

* They don’t value their own talent. They feel “lucky” to sell one of their pieces at any price, even if the sale barely covers the cost of their materials.

* They believe their jewelry is “unworthy” of netting higher prices.

* Their well-meaning friends and family (who don’t know anything about the handmade jewelry market) urge them not to “risk failure” by setting their prices too high.

* If their jewelry isn’t selling, they assume it’s because of the pricing – so the first thing they do is drop their prices.

* Their financial situation makes them desperate to make a sale, so they hesitate to put higher prices on their work for fear of scaring customers away.

* They’re not sure how to price handmade jewelry.

Tip: If you’re not sure how to price your handmade jewelry profitably, please see my Jewelry Pricing Formula.

But why not charge low prices for your handmade jewelry?

I’m going to share some of my thoughts here, and then I hope you’ll leave a comment below to share your thoughts and experiences regarding low prices on handmade jewelry!

 

Working Harder to Earn Less

Pricing handmade jewelry too low means the artist may have to make and sell 5 pieces of jewelry to earn $50, rather than earning the same $50 for just 1 piece.

When jewelry artists set themselves up to work harder while earning less, it’s not a sustainable way to run a business.

Sooner or later the overworked artist tends to either burn out, or shut down the business because it’s not profiting enough to stay afloat.

 

Growing the Wrong Customer Base

Under-pricing handmade jewelry also means that artists tend to attract a customer base that consists of “bargain shoppers” rather than “handmade jewelry shoppers”.

That makes it hard for the artist to raise their prices without losing a big portion of their customer base.

 

It Devalues the Overall
Handmade Jewelry Marketplace

When some artists get into low-price wars, or try to compete with cheap imported jewelry, it can hurt other jewelry artists’ sales.

Unrealistically low prices can cause some customers to equate “handmade” with “cheap pricing”, and pass up jewelry that’s priced higher and more realistically.

Undercutting other jewelry artists doesn’t do you or your fellow artists any good.

 

You Don’t Want to Make
This Kind of Jewelry Sale!

I’ve seen some jewelry artists actually buy other artists’ low-priced jewelry … specifically to take it apart and remake the components into a much higher-priced piece of jewelry!

The under-pricing artist is thrilled to make a sale – but has no idea their creation is being bought as a cheap source of jewelry supplies.

Don’t let that happen to you!

 

Comments:

Hey, You’re pricing is too low!
by: EmandaJ

I was at a church convention with many vendors. There was a sweet little lady sitting behind gift boxes of her handmade jewelry at bargain basement prices. I spent ten minutes telling her it doesn’t do her or me or any other handmade jewelry artist any good for her to under-sell herself. I think I made a convert. The next year her prices were slightly higher (but still low). Her customer base is the retirement center where she lives — folks with limited income.

Emanda

When jewelry customers have a small budget
by: Rena

Emanda,

Great idea, to enlighten the sweet little lady who was charging bargain prices! :o)

I’m glad she took a step in the right direction (even though it was a small step!).

What should jewelry artists do when their customer base has a small budget, like the lady you mentioned?

In that case I recommend creating jewelry that’s profitable at lower prices.

It kills me to see artists drop their jewelry prices if their clientele can’t afford it.

I always say, “Please don’t reduce the prices on your jewelry to sell it at lower price points!”

Instead, I recommend creating a different line of nice but quick-to-make jewelry from less expensive components. These jewelry items should wind up netting the artist a good profit when priced under $20.

Designing jewelry to be profitable for the artist while fitting the customers’ budgets is a good business strategy.

But creating any jewelry the artist feels like, and then dropping the prices to fit the customers’ budgets, isn’t such a good strategy.

pricing too low
by: Kim Isner

I tried Rena’s idea of creating jewelry at lower prices, because my sterling silver bracelets were rightly priced high. At the craft show, it gave shoppers an option. Plus, the lower priced jewelry was Ohio State Buckeye jewelry, and because we have rabid Buckeye fans here, those items made sales!

Multiple pricing for one piece.
by: Rita Juhlin

Knowing what my cost is enables me to change the pricing of a piece of jewelry to fit the market, always keeping in mind I need to make a reasonable profit. I don’t and cannot do this selling on the internet but since the majority of my sales come from in-store consignment sales, I can.

When selling in a gallery setting the piece is presented much more dramatically than if the jewelry displayed in a coffee shop or an out door casual art fair. In a gallery the emphasis is on art; and those who appreciate the art, design and uniqueness more than the materials will find a higher price acceptable.

I have also experienced some guilt in knowing what the cost of a piece is; having a store owner put an outrageous price on a piece and selling it within hours, (woohoo) but I got over the guilt quickly. (lol)

My rule is to be fair in my pricing at least when I price something. I really believe that some home-based jewelers ‘lack confidence’ in their work which equates to one reason for under priced jewelry. My guess is that from the buyers prospective, low pricing equates to damaged goods or inexpensive costume jewelry.

Confession: guilty of emailing fellow home-based jewelers and letting them know, in a nice way of course, that they should raise their pricing and why. My opinion is experienced based and I look really hard at craftsmanship and design before I start the conversation. I’ve never let anyone know I think they are over priced; I just roll my eyes and go on.

competing with the hobbyist
by: Anonymous

I have run into a lot of jewelry hobbyists at shows who are “in it” to recoup their cost to buy more beads.
I had a lady tell me, (I was in the booth kitty-corner from her) that she had $50 in parts in a piece…with a $54 price tag on it. Yikes…!
I’m guessing the only way to get away from the hobbyist is to be more selective of types of shows I apply for.
Any other suggestions…?

Soooo True
by: Debra

Thank you so much for this great information. We have to price our items for the time, supplies, and your expertise. We can’t price to low in order to get sales because if we do we will never be able to rise our prices because we have attracted people that won’t to talk you down or it’s like a biding war they will have gotten used to those prices and when you add it all up you’ve lost out all together you had to do the same amount of work, pay the same prices for supplies.

Thanks great article

pricing
by: Sandy

Great article – thanks! I figured my cost on a popular item I sell at $40-45 w/ your formula. Came to $72. I certainly get the logic & rationale. I had raised my prices my 2nd year in business (this year) yetI have not been able to sell the pieces I offer higher than $45 very easily at all, so $70?? I just doubt it. More/better marketing? Better shows? All would be good I guess. I’m still building a market & clientele – my stuff is part jewelry/part “other” so I am doing alot of education about what’s it about. Tough stuff.

Lowering your prices hurts everyone
by: Anonymous

This is a problem withmany items being offered at such low prices that I wonder if they are losing money rather than making it. It puts other sellers in a bad position as well, forcing everyone’s prices lower than is fair or reasonable for their products. If you are barely covering the cost of your materials then you are working for free, and that’s just nuts.

Find the right place to sell
by: jennyferrow

If you have the right customer then your price is justified and able to pay you a wage. I had some silver and stone pieces in a shop and they were not selling so I put them on sale. A woman bought a piece and didn’t realise it was on sale until paying. She liked the piece and wanted to buy it regardless. I just lost money because I thought it would sell quicker if it was cheaper. Maybe we just have to make sure we have more exposure to the right kind of customer.

Hobbyists Vs Artists
by: Anonymous

I guess when it comes to this debate I’m not sure where I fall. I would consider myself a hobbyist but that could be because Ive seen the work that is out these and I feel like mine just doesn’t compete. Maybe that’s just me being insecure and I know that it translates into me having low prices but I now completely understand why this is not right for me; or my fellow ‘artists’ in the market place. I might just have to bite the bullet and put them up – hoping that my work is as good as everyone else s.

Sandy – RE: Pricing your $40-45 item at $72
by: Rena

Hi Sandy,

If your customer base gravitates toward your pieces priced in the $40′s, you may want to focus your line on pieces that are created to be profitable at that price range.

In addition to that price range, I think it’s also a good idea to have a line of higher-price pieces, such as your $70-ish item. That way you also have items for higher-spending customers. Plus, I find that once lower-spending customers have shopped from me a few times, they start looking at (and buying) my higher priced items as well.

Just a thought!

Thanks for the article
by: BeadJewelled

Thank you for your article.
I’ve always found that customers don’t respect work that is too cheap.

I try to offer a wide range of price points to appeal to many budgets.

The biggest mistake I find is jewelers apologizing for their prices. ie: “I’m sorry, but that piece is…” You have to look the customer in the eye and confidently state your price. The customer will pick up on your confidence and pride in your work.

Early in my career I would play with prices, raising and lowering them, looking for the magic number. More often than not, raising the price sold a piece faster than lowering it.

I liked your basic formula but felt that your wholesale price was too low.

Thanks again for combating the scourge of underpriced jewelry.

Perceived Value
by: Sheryl

Many customers place a value on something they see AFTER looking at the price. Rarely do I see a piece of handcrafted jewelry or other item, that I think is overpriced. I think it is common for many people to have the “If I can do it, anybody can” attitude, so we naturally lower our prices to reflect that perceived value. I know I do. I have seen my abilities grow with each piece I make, yet my prices have remained fairly stagnant over the years. I am now preparing several pieces for a gallery in Cape Cod. You can bet, I’m going to ask a REASONABLE price this time!

Consider Factoring in Profit
by: Patti Leftwich

I recently read a great article on the subject of pricing handmade jewelry in one of the art jewelry magazines.
I agree with Rena-her formula for calculating a fair and reasonable price is very valid, however this article made me consider another factor-profit. The article suggested that you should not only consider material costs, labor and overhead, but also a profit margin. A profit margin is not the same as paying yourself for labor costs. Another way of looking at it, imagine that you paid your friend or daughter labor costs to make some of your jewelry…the profit margin would insure that your business receives a profit from a sale, after you paid your helpers. If in fact it is you providing all the labor, it makes no difference, your business also needs to be “paid”. And by adding in a profit margin you also help alleviate the cost of replacing materials which probably have increased since you purchased them for your project. Like most of us, I am a solo gig, but I have started adding 3-5% to my prices to factor in profit. I also factor in sales tax, which customers love, because the price they see is the price they pay. I have signage in my booth that tells customers that price includes tax and that has made a positive difference in sales. I round off the price too, which is easier for me and the customer-no more handling coins, and easier math!

Glad to read this article and comments!
by: Cindi

I find that pricing is the most difficult part of my business. It has taken me years to price things at a high value. I was encouraged by one of my suppliers to increase my prices (thanks, Lynn).

I also prefer making high-end jewelry, but do try to include some pieces at lower prices (but not too many). I want to attract a higher-end clientele.

I believe that the current economic conditions (people are really not spending that much on unnecessary things) has aided and abetted in the problem of jewelry being priced too low.

pricing
by: Barbara

I agree with everyone. I sell regularly at a Saturday farmer’s market which is attended by people from all walks of life and with all budgets. I learn and practice my new skills on cheaper wire and using inexpensive beads and materials — and price accordingly, keeping in mind there are a lot of kids and lower income shoppers — and then switch to sterling and higher quality semi-precious and price those accordingly. What has happened over the past year is that I am now attracting the notice of and making sales to business professionals and summer tourists who attend the market.

One day I had a discussion about pricing and materials with the owner of the store that carries some of my work. She told me that people buying gifts don’t want to appear cheap — particularly husbands! When it comes to gifts people want to be generous and are prepared to not just pay more for something but to buy something worth more. So, yes, we should charge what something is worth and not apologise!

I think what holds me back in pricing is that I would never in a million years pay so much for jewellery for myself. Sometimes when I do the pricing calculations it takes my breath away! But we have to remember that this jewellery isn’t for us. Quite apart from being mindful of the venue we’re selling in, so long as we stand behind the quality of our materials, design and workmanship, then that’s the price, and someone will come along who will appreciate that and be more than happy to pay for it.

Some Historic Rena Advice
by: Kathie L

Thank you for sharing your article! Great advice! Here’s a piece of advice that Rena gave several issues back –> boy does it help! She said to use your more glamorous (my word not Rena’s) piece on advertisement’s etc. She noted that this piece may not sell (right away); however, it will bring customer’s in with their curiousity. Once they enter your publication, they can see the more reasonable priced items. The expensive piece/s may not sell right away –> but give them time! They work well to attrack curious on-lookers and may even get you some serious customers –> there for the return sales. Good luck to you!

You’re worthy!
by: Barbara herndon

As long as we have millions of gals giving it away, it will always be a struggle to sell at a profit. But consider how many come and go – will you be able to find them if something goes wrong?

Consider quality – It takes five minutes to learn a skill, five years to be really good at it, and maybe another five learning to stand out.

Consider price – When was the last time YOU dreamed of owning something cheap? I LIKE nice things, and as a woman, also feel like I’m WORTH nice things. What man do you know who prefers his woman in cheap stuff?

Let’s make lovely, quality things and sell women on the idea that they are more than worthy to own the very best and that their men desire and deserve a woman they can show off!

barbaraherndon.com

Thanks Rena
by: Anonymous

Thanks Rena for a great article. I struggle with this subject, but reading your article is making me value my work. If I value what I do, then others will follow.

Know your audience, price accordingly
by: Erin

I have had discussions with artist friends whom I think price too low. I was told by an artist that she got into it and priced to cover her costs and buy more beads. But now it has taken off and she is very popular, and I told her that she needed to upsell… still offer those $45-50 bracelets and necklaces, but also have a line that edges it up to what it is really worth. Especially if it includes art beads…those are VERY costly (and well worth the expense, I might add). I sometimes worry for her that she is undercutting herself and her amazing talent, and also the rest of us.
I believe that we have a right to charge what we are worth, and that most who start making jewelry don’t believe in their worth. I use a pricing similar to Rena’s, but charge x5. That gives me room to adjust if necessary, plan for future wholesale selling and take care of a profit margin (I like that idea). I used to obsessively write down every component and how many of each and then calculate it all. Now I am pretty good at knowing what the value needs to be within my framework.
I do believe firmly in finding the right buyers for your wares. I don’t take every offer to sell my work if I don’t feel that it is the right fit. I sell my work in an artist’s coop, a custom goldsmith studio and a high end fundraising show each year. I am very selective about it, not snobby, but I am not looking for bargain hunters. I am seeking those who appreciate art and one of a kind and stand out sort of pieces. Knowing your client base is so important.
Thanks for the insightful article, Rena!
Enjoy the day!
Erin

Getting Over Myself
by: Donnie

Having limited funds for myself for so long has led to the the cheap syndrome. I would never spend that much money on myself because I can’t afford it. Getting involved in creating jewelry myself has taught me to appreciate the work that goes into the thinking, planning & creating a quality piece of
jewelry. That has caused me to see other artists & their pricing in a totally different light. I am getting over my deficiencies & seeing myself in the same light – what I have & what I do is precious, it is a part of me & that part of me is creating something precious for my customers. If they choose to pass something by because they feel it is priced too high for them then they are they ones who are missing out. I do not take it personally!

Target your jewelry line
by: Cloud Hale Design

I’ve recently determined that you can’t be everything to everyone. Choose to make jewelry that is profitable & affordable to your existing clients OR choose to make jewelry that is higher end & sell where the clients can afford it. I recently had my worst show – it was juried & the type I normally do really good at. While the traffic was slow, I don’t think that was the only reason. I had everything from $16 earrings to $300 necklaces. I sold hardly anything, but the artist who had only high end stuff starting at $300 sold a decent amount, and the artist who had mostly earrings under $50 also sold plenty. Why? Their lines where targeted! People who looked first at my high end stuff & couldn’t afford it walked out without noticing my lower priced stuff. I think my lower priced stuff “cheapened” my high end stuff – customers have a hard time understanding the real differences in their costs. Why did the high end artist do so well? The jewelry was very cool & technically difficult – i.e. he doesn’t hear “Ooh, I could make that” and he doesn’t appoligize for for his expensive prices. I have been focusing on my PMC & wirework pieces, & I think I will phase out my lower priced earrings.
Tina

Jewelry vs Painting pricing
by: Cloud Hale Design

Why is it that when we(jewelry artists) price jewelry & some customers evaluate our prices we tend to think about the material cost & the basic labor for assembly. What happened to the ARTISTIC TALENT?? What separates beautiful jewelrly from ordinary crafty or mass produced jewelry is the artistic talent. Why is it that nobody tries to price a painting based upon the material costs of the canvas & paints? Paint & canvases are cheap – shouldn’t we be able to buy a painting for $20?? NO! It’s all about the artistic talent that turned the materials into art – that’s what we pay for! Don’t forget jewelry is art too, and you are an ARTIST!
Tina

phasing out low end jewellery
by: Barbara

I agree with Tina, particularly when it comes to craft shows. I’ve seen the same thing. It’s funny — I am most attracted to the very spare, well laid out displays. My table tends to get a bit disorganised looking — well, let’s be honest: junky-looking — because I want to put everything out all at once. I’ve enlisted a neat freak friend to help me simplify.

Even though above when I talked about having different things and price ranges on offer on the same table at the farmer’s market, I’ve now got things clearly separated, and I’m not replacing a lot of the items. If anything, I’m trying to up the quality and price of my lower-priced things.

I’ve been there long enough that most people have gotten to know me and they go straight to what they want, but if people tell me they’ve never seen my stuff before, I give them a little guided tour of the table explaining the price ranges and what I’m trying to do.

Craft shows are very different. You’ve got literally a few seconds to attract someone’s eye, and it’s a one-off occasion. Despite their best intentions, people very rarely will come back after looking around. Either they’ve forgotten all about you, or they’ve spent their money or the show is closing.

An eye-opening exercise in pricing your work
by: Sandra Patrick

I’ve been a visual artist for many years & started making jewelry about 6 years ago. I’m also a business person & financial officer for our landscape business. I know you have to have a good formula plus a wiggle factor when pricing your(any)work. I target the upper clientele in my jewelry & researched to find the best formula to price my jewelry. First- I know the cost of each component that goes into the piece – down to the wire & crimps! My general formula is: Cost (ie, cost of goods sold) x 2 = A. A + labor cost (time at $20/hr average for a bench jeweler) + design time (at $20-40/hr) = B. Cost B is your actual COST to produce the item. Now add your overhead (includes studio, utilities, cell phone, travel time, fees to shows, misc tools, etc..) which for me is about 20% of the cost. So Cost B x 1.20 = Cost C. Final addition: add your PROFIT. If you want to achieve a 20% profit, then cost C is really 80% of the piece & profit $$ is 20% to equal 100% sales price. How do you get THE SALES PRICE? Divide Cost C by .8 and that equals sales price. Then – look at the piece itself – is it so unique and well-crafted that it could be even higher priced? Will your clientele want it no matter what the price (the wow factor). You could nudge it up even more. Guess what – if you want to wholesale it to a shop or gallery – this sales price is actually your wholesale cost! The true retail cost of the piece is double your desired sales price. If someone asks you if you can lower the price for a piece, you can tell them that this is actually a wholesale price, it would be twice that if they were to buy it in a shop or gallery!

Dropping Jewelry Prices
by: Anonymous

Wow, this topic has the most comments I’ve seen on this site!!

OK,,,I have a store on Etsy..and (said with the utmost shame and guilt), have reduced my prices..all in the name of tryin’ to make a sale…and STILL, NO SALE!

This was a serious judgement error, on my part. Because it is not a true worth/value and I don’t mass-produce…even if I sell it..I sold it at a loss.

Also, what I tend to forget is just because components have been sitting in my inventory…doesn’t necessarily mean they’ve lost value.

I thought I would gather a loyal following and then raise prices…but that’s not a good business practice, either.

Customers admire my work, but when I tell them the cost..they hesitate. When I tell other jewelry designers my price, they’ve all said, “You’re pricing it too low”.

My friends/family are the kind to wear solid gold and precious stones…so they see my stuff as costume. Those who wear costume, see my stuff as over-priced. I need to find those in the middle.

If I want to sell stuff for a dollar, then I need to make it from stuff that cost pennies and the reverse.

Good discussion!!
shocdesigns.etsy.com

Pricing
by: Aileen

I have enjoyed reading all the comments and this newsletter for over a year now. I bought Rena’s book on the “ultimate guide to a profitable booth” last year. I read it cover to cover in a short while. Then I implemented many of the things I read. The biggest one was pricing. I had a beautiful piece of Ammolite over 40 carats. I had 14kgf Wire sculpture wire on it. I included a 14kgf chain. I carried this piece around to several shows. I had it priced orinally for 115 so I raised it to 195 still nothing so I raised it to 450 it sold at a festival. All the while I kept educating people on the price. I told them that I saw a piece on a jewelry shopping channel for twice as much on half the size and in sterling. The woman could not get it fast enough.
Since then I have kept my prices on the higher end. I also feel that since I am making one of a kind pieces that there is one special person who that piece was meant for. So I continue to carry from show to show so that the two can be united. If a piece does not sell one year, I raise my price the next year.
Now I am no longer embaressed about my prices. I see in magazines all the time people who have been doing this a lot less time than me and not the same quality charging far more than I do.
Come see some of my work www.aileensart.com

Wow!
by: Terri wlaschin

I think I have held every opinion on this page at one time. I have now come to see pricing as a personal thing. By that I mean I may have the same materials as some one else but I may have paid a lot more or less than them. And, my level of creativity, complexity, and design capability may be different from theirs as reflected in how I use the materials in a piece even if the materials and the time it took to make it is the same. I do believe that if you price low, you will attract bargain hunters and a clientle that will want to negotiate pricing even further. But I also believe that to price higher the quality of your piece and your reputation better be impeccable if you hope to sell and stay in business. I think selling at the high end requires the patience to build trust and relationships with customers and hone your skill in jewelry making. When I was buying jewelry, I would not have paid more than $100 for anything from someone I thought I was only going to see once at a show. If they had an online presence or were local, I might consider that…after I got to know them. I sell on etsy but most of my sales (online and offline)are to people I already know from building relationships and a mailing list over time. So, if I am at a show, I really don’t worry about how other people are pricing because I see their work as different from mine. Or, if it is similar and they are priced low, I just figure they will attract a different kind of customer than I want. I would not lower my prices just because someone else does because of what it does to me and my feeling about my work. Most times I lower my prices because I am tired of seeing the item:) My main goal at shows (besides selling of course) is to meet potential new customers and maybe get them on a mailing list and to a home show and hope, over time, I will make them lovers of my jewelry. Having said all that, I know some people are struggling to make a living and I support them doing whatever they think they need to make that happen.

Middle of the road
by: Vicki

I consider myself the middle of the road, in my pricing. Many people have told me I need to raise my prices, but just as many have told me I was to high! Go figure…any way I sell a good amount of items and I am happy, so i guess there is a clients that need the middle of the road too! I think what bothers me, about alot of the higher pieces, is that “they are just not worth it’! I have just seen necklaces, made of one string of twine two or three knots and four or five beads, and was asking $65.00 for it. Whats with that? Any way just wanted to make a point to pricing ridiculously high also! I know,I know, I will get pulverized by this,but just another opinion! Good luck everyone!

Maybe you don’t know
by: Millie

Some time ago I handcrafted a piece of sculpture and I priced it at $25.00. Hmmm, a woman came by and asked why the piece was priced at $25.00.

I said I felt that it was a fair price and she promptly handed me $75.00 and said “My dear, you don’t know what you are worth.”

I’m sure you get my meaning here.

Millie \o/
Overstocked with Rocks

Paying More
by: Barbara

I’ve had people do the same thing on several occasions, give me more money for what they bought. Really does make you rethink how you’re pricing things.

Some things to think about
by: Lisa W.

I have read all of the comments here, many with very good points. Here are a few other bits for thought. A profit is required if we want to grow our business, and for some of us, if we want to eat and pay rent. Even non-profit organizations make a profit, or they can NOT stay in business. Their profit margin is restricted, but they DO make a profit. Do you?

Counting all of our components to create a basic materials cost is a good strategy – IF we are making all of our jewelry from components. The minute we begin to create our own materials, we are in a new realm, and component cost becomes only a portion of our materials cost. What about those materials that are required for our work, but are not components? In my case, there is acetylene torch fuel, flux, solder, pickle, oxidation chemicals, etching chemicals, sanding materials, buffing materials… and that is just a partial list, I could go on. I know this is true of many of us: we HAVE to consider our consumables! If our pricing structure doesn’t build in an ability to replace consumables, we are NOT making a profit.

What about our studio tools? If all we need are a few pair of pliers to do our job, there is less concern than if we need a studio to do it. have you been buying new hammers? A kiln? A rolling mill? A torch? Better pliers? Please realize that the cost of our pieces must pay for every tool we own, or we are NOT making a profit!

I know the point has already been made, but we must also pay ourselves separately for our time, as if we had hired someone to work for us, because in the future, it is likely that we will. If not, we are NOT making a profit!

Have you considered that we will pay income tax on our profits, and therefore, we must raise our prices enough to cover the taxes we will pay? If not, we are NOT making a profit!

There is so much more to say on this, but here is the bottom line: If your prices are low, it is possible that without knowing it, you are losing money with each piece you make and sell, and you will not find it worthwhile to continue. This is why successful jewelry businesses seem to have such high prices. In addition, the artificially low prices you are charging make it much harder for those with more legitimate prices to survive. Finally, if you charge low prices, you are telling your customer that your work is worth little; they will be appropriately suspicious.

There is so much more to think about, here, but as a community of artists and business owners, we should want to keep our quality high and our prices appropriate. Educating and helping one another is keeps us all moving forward together!

Undercutting
by: Skyfire

I’m also a writer and editor, and I see the same problems there as well. Instead of charging a professional wage, I’ve seen freelancers undercut competitors by charging minimum wage and less just to get the work. This does everyone a disservice. Also, a lot of people think of “homemade” as something cheap and tawdry that was just thrown together without any thought or care. My own mother had that attitude and would be insulted if I gave her something I created myself. She insisted on something “nice” from a store. We must remember that we are not just hobbyists throwing things together to make some spare change, we are artists and professionals and should be treated as such. We should treat ourselves as such.

Pricing too low
by: Karen

Being fairly new to jewelry making (but being of a creative nature all my life), I too have had internal battles on where to settle my prices. I recently heard an interivew with Dr. Weiman who cited an incident where a artist made a ring and sold it for $79. The person who he sold it to had a gallery in California and resold the same ring for $850!! I think “perceived value” has to be included in any pricing formula. And I think you have to have a target audience in mind. As I am trying to support myself while being caretaker for my mom (I live with her and she pays the expenses), I feel I want to attract a mid-price shopper. Let’s face it, in this economy, jewelry is a luxury, impulse item. No one HAS to buy jewelry to survive. As someone else said, it’s also hard to price items at a point where you know yourself you wouldn’t pay. But I do take into consideration time and materials. Right now, because of my living situation, my time is my profit. So I think I can build and raise prices as time goes on.

One specific thought came to mind as I listened to Dr. Weiman’s interview. My first “show” was at a church yard sale. I wanted to “test the waters” and see how well my designs would go over. NOT ONE PERSON tried to bargain with my prices! Lesson taken – I’m pricing too low! I will raise them a bit before my first craft show this weekend.

Great thread – I enjoyed reading all the comments.
Karen’s Jewelry Creations
kzjewelry.etsy.com

Fear of no sales….
by: Anonymous

As a new jewelry artist, I too am afraid to raise my price due to not getting the sale. I work with school teachers and they have (of course) encouraged me to keep my prices at a point where they can afford to buy on “impulse”. I need to get over this hump, but at this time, this is my clientele. Lots of food for thought – I appreciate all the comments.
–CK

Pricing jewelry
by: Anonymous

One of the things I’m doing is making some of the jewelry out of more inexpensive materials, like copper, brass, and silver plate. If it only costs me 50 cents for components, takes less than 15 minutes to make, and I charge several dollars, then it’s an affordable pair of earrings, and I still make a respectable profit. If I’m using pricier components and it takes longer, however, I’ll price accordingly.

Priced too low
by: Anonymous

I have discovered the problems with low pricing many years ago when I had my jewellery repair business. As I am a goldsmith by trade I also made bespoke items but found when my prices were low very few seemed to buy. When I sat and thought of all the hours i had put in and re priced bespoke jewellery higher the sales soon followed. Never under value yourself after all it is your talent that people are paying for.

Jeremy
www.jbyjeremy.co.uk

GOOD DEAL….?
by: Anonymous

i’m a hobbyist who sometimes sells some of my homemade earrings at work. recently a lady who always requests my work finally decided to ask for a “good deal”.
now, she’s well due for it, but this time i was making two different types of earrings. one was simple in material but timely in design ($25). the other was simple in design , yet costly in materials ($56). i tell her that the price is $80, but i’ll sell it for $70.
whoa!!! that’s too much!…. and it’s not even name brand!!
i was certainly hurt, but quickly diffused my emotion and let her know that’s fine, and insisted that she at least purchase one today (since they were made for her!) then also implied she take a glance at the other, just so i may show her the reason in the difference of prices and that truly, i’m not trying to get over.
i let her know that i value her business and thanked her.
so, turns out she wanted the more expensive one more than the other! although she paid for the lesser one first, she decided to put half on the decided agreed cost of the $56 at $40. i suppose this was the right thing to do considering that i’m not a business name and she has been my longest client.
BUT mind you, it took 3 hours just to glue to stones on!! not even marbling the clays!!! product is $26.50 alone. leaving me at $13.50.(i’m not legit yet so i figure $10/hr is reasonable, until i get enough money up to pay for business fees.)
what did i do wrong? what will make stable pricing right in the future, should i stop while i’m ahead? is this the kind of insult that rushes one in to make a business for themselves? i suppose i’m a begger who can’t choose?

To Anonymous . . . when customers request a “good deal”
by: Rena

I really appreciate all the great insights and experiences everyone is sharing here! Thanks so much for taking the time to comment on this issue.

To Anonymous (who posted just above me here) -

It’s difficult to respond on the spur of the moment when someone (especially an established customer) asks for a “deal” on your work!

I’ve found that it’s very helpful to decide ahead of time what your customer policies will be for issues like

* guaranteeing your work

* altering / resizing jewelry

* refunds

* exchanges

* custom orders

* payment

* pricing for your time

* haggling/bargaining

* discounts

* freebies.

Determining your policies ahead of time enables you to make the right call when faced with unexpected situations or customer demands. You’ll have well-thought-out guidelines to fall back on instead of relying on your first impulse.

In contrast, it’s much harder to make good a business decision if you’ve never considered your discount / bargaining policy until a customer is standing in front of you asking for a special deal or other concession!

Since this lady was your best customer, it’s definitely good to give her special deals and privileges from time to time.

But now you might decide that while most of your inventory is open to special deals for your best customers, your labor-intensive jewelry items aren’t open to discounts and bargaining.

If so, then decide how to politely handle this kind of request in the future – so that next time your best customers request a “good deal”, you’ll be ready to explain the exception for your labor-intensive pieces and offer a fair counter-deal involving other pieces.

Also see Cindy Cherrington’s helpful article on Haggling with Customers.

cutting prices
by: Barbara

I agree with Rena, to have handy a list of policies that you’ve thought out beforehand — and crunch the numbers as you go through it, especially if you’re thinking of putting things in a store/on consignment. Write your own policies down if you have to.

Practise a typical transaction in front of a mirror and/or role play with a friend if you really want to learn to be firm. And play both parts — be the customer who wants a deal. It’s amazing, because all of a sudden you’ll realise what a game it is to see how low you’ll go in price — it has zero to do with your workmanship, time and materials inputs. This person will very likely pay the full price; they just want to play a little game first.

Practise your “game face”, too. Have a friend videotape your role-playing. Practise saying the word, “No.” or “I’m very sorry, but no.” Keep it short and sweet. The longer the customer can draw out the conversation, the easier it will be for them to get the price they want.

There’s a bead lady I’ve met several times who I now model myself on. She’s pleasant and always smiling, but professional — meaning she’s not trying to be my friend. She knows she has what we all want, and offers discounts at certain price points and that’s it. No one would dare haggle with her over a $5 string of glass beads.

I’ve just been through what you’re going through with someone I call the Moocher and it hasn’t been pretty. Yes, I caved… in the beginning. I finally put my foot down (to myself, as well as her) when she pushed too much and I told her point blank: “I’m not making anything on this. My prices are already very reasonable, and I can’t give you something for what I paid for it.” When I heard those words coming out of my own mouth — the light went on.

I heard later from a few other people who were also getting a bit put out by her constant importuning for better prices and her insistence that she would be such a good customer… well, we haven’t seen her in weeks.

Hang in there!
B

Oh, please!
by: Creative Habits Artisan Jewelry

I finally have had it with people…..

I was a show this weekend and a woman came into my booth and the first words out of her mouth were “What kind of deal will you give me?”

I responded: I am not in the business of discounting my work. Let me see what you are interested in and maybe I can pay your sales tax for you…….

I was really ticked off. I am tired of that mess.

Then, I find out that she lives in the Austin area and was wearing a custom made ammonite pendant…..please woman!

That’s it. I am tired of “deal makers.”

For those newbies….
by: Creative Habits Artisan Jewelry

Newbies…

Make friends with some of your “competitors.” We often all make something very different from the same set of stones, etc.

Your competitors are your best friends when it comes to pricing. Talk with them. Show them your work. Ask their opinions!

Cindi
www.creativehabits.net

GOOD DEAL….?
by: Anonymous

thank you, Rena, for the same day response. you are AWESOME!!!!!!!!!!!!!

Prejudice against “hobbyists?”
by: HOBBYIST!

Wow, I am a newbie “hobbyist” at jewelry-making and found a comment or two here rather discouraging. I didn’t realized that “hobbyists” were considered inferior to “real” artists. We all have to start somewhere. Let’s cut the newbies some slack.

There is some great information in this thread. Thank you!

Hobbyist
by: Anonymous

Yes, that comment turned me off too! I didn’t realize there were ‘classes’ of artists!

Hobbyists bs. artists
by: Creative Cove Jewelry Designs

I think that the difference, in this instance, at least to me, is not whether you are a hobbyist and thus not an artist. In my opinion, the difference is whether you are doing it as a hobby or a business. I find in my experience, that the hobbyist who has a full time job has no issue with underpricing their items because they are just trying to make money to buy more supplies. I started my business two years ago and it IS my income. I have no back up, no full time job other than making my jewelry. It is frustrating to me to have to compete at shows with those who do this as a hobby and just want to sell to refuel their bead habit. All of us are artists, but doing your art full time opens up a whole different set of issues, ie: self-employment taxes vs. having your taxes automatically taken from your check.

Too high or too low.
by: Fran S.

I too consider myself a artist making wearable art and I am reading everything I can on pricing my pieces. I have learned a great deal reading everyone’s contributions. I have one thing to add regarding high prices. Next time you are near a magazine rack pick up a copy of a fashion magazine such as ELLE or MARIE CLAIR and look at the prices of the jewelry in them…some of it is very ugly and not always made of expensive materials but the prices are out if sight. The ‘designer label’ makes all the difference.

Pricing
by: Tesia

I think the main thing with me is that i feel that if i put the prices too high then people will shy away. Right now i tend to take my materials cost x 2 and then add in for labor so my one necklace cost 8 dollars to make so i double it and then add about 14 dollars and therefore the piece is $30. With your formula i would be charging around $50-$60 for everything and i don’t see people buying at that price in this economy.

Thanks
by: Sandy

I love reading everything everyone wrote about.. It is soooo helpful. I have a hard time pricing, like everyone eles. You know as much as I need the money right now, some of my necklaces need to be priced higer. I am trying to remember I love doing what I do. If it sells that would be great, If not I’ll keep it.
thanks again
Sandy
Jewelsforhope

THANK YOU
by: MIMI

Thank you Rena,your advices are really valuable, I’m in jewelry business for more than 10 years, I was doing very well the first two years when I had my handmade jewelry displayed on my dinning table, I was making a good profit, ladies were happy to come to my place, chatting, joking, having coffee but at the end they buy at least one piece and I was enjoying talking and explaining every simple piece.
One day a friend who was in charge of one of the big shopping center offered me a booth with low rent which I did and multiplied my price by 2.
believe it or not since that day i’m just gaining a big stock and very little profit.
I’m suffering , I can’t find my mistake and I will not stop my enjoyable work.
I need your advice.

Pricing too low
by: Anonymous

I am unable to get around and sell at shows so I use ebay. It seems there are so many people with such low starting prices it never gets sold for more than a few dollars. Now I start higher I am often looked over because of my beginning price is way higher than some. I see the work they put into their designs and can never understand why they would accept such a low price for a work of art. I know the prices of the materials and the appoximante time it takes to make some of these designs and it really gets to me that they would give their merchandise away to just make a sale. Not to mention undercutting those of us who are not willing to throw away money by accepting less than our jewelry is worth. Ebay has become a place people just bargain hunt like a flea market.

Jewelry vs. Painting & pricing too low
by: Just A Tad Frustrated

It didn’t take me very long to get irritable when a friend of mine, who does colored pencil drawings, started making noises about the pricing of my jewelry earlier this summer. I use VERY good materials (and I suspect that I’m still undercharging for my pieces). I made precisely that point with her that was made earlier about cost of materials and time investment. Now, for the most part, she’s quit.

difficult competition
by: zilvera

Since 2 months I try to sell my jewelry online. I price my pieces almost at a cost price (including such capital costs as write-off of the equimpent), and still no one wants to buy it.
One of the reasons is that sites as etsy.com and artfire.com are US-based. Not only EUR to USD rate is unfavourable, but also shipping costs from Europe to the US are disproportionally high. A registered mail from the Netherlands to the USA costs about 20 USD. And this is not even the most secure way of shipment (shipments are getting lost, very bad track and trace service). The cheapest UPS mail costs about 50 USD. My prices are in the range of USD 20-40, so it’s quite out of proportion.
I guess I should try to concentrate on a local online market. Unfortunately we do not have an equivalent of etsy in Europe. In the Netherlands there’re great sites for secondhand stuff like marktplaats.nl. If you need to get rid of an old guestbed or a bookshelf, it’s a great place to be. But handmade stuff doesn’t really sell there. The ‘handmade’ (made in China) jewerly offered is mainly of ‘wholesale’ type, you see series of not too expensive pieces with suspiciously similar design, but different stones etc. The prices are in the range of 10-15 euro’s (20 USD).
So, that’s quite a problem. Of course, the reason for no sales could be that my jewelry is simply not good enough to wear. But I have seen people wearing worse! There must be some emotional factor behind it, I think.
So, I am at a loss. Anyone with the same experience?

Build your confidence!
by: Deb Greener

I am soon to be putting my jewelry on several sites for the first time – I’ll start small and have plans for growth – so I’ll soon be a newbie to selling jewelry. However, I have been in handmade retail before, 30 years ago, and let me tell you I learned a great deal!

I designed, created, retailed and wholesaled handmade dolls. I priced my products so low that I had more sales than I knew what to do with. (That’s where we hope to arrive, right? Lots of business?) Somehow I had allowed myself to get into the mindset of competing with mass-produced gift merchandise. (Handmade does NOT compete with factorymade! Duh!) I was able to get many orders by selling to gift shops through several reps I took on found at the gift shows. I had to hire a few people just to help me get the orders out the door, and NEVER got a break. And still I could barely make end meet. I began to hate what I did and was so burned out that I was miserable. My husband, bless his heart, told me I should shut down. “What, and sell out? Give up on my dream?” I trusted his pleadings and closed up shop. In hindsight I know that my low prices stemmed from my unrealized lack of confidence about my own value, and resulted in the death of my business.

In time I created another business, providing services as a professional Sign Language interpreter, as I am fluent in American Sign Language. I got the necessary education, have tons of experience, and have been doing this ever since and am able to make a decent living. There too, through the years there have been times where courts or hospitals or other places that use my services made me want to lower my prices just to get the business. I have been extremely fortunate to have support from many wonderful colleages, most of whom had to also come to terms with a fee that was fair to themselves, and I totally understand that when a newcomer sets low prices it hurts the whole market. (By the way, this site is GREAT as colleagues benefit from sticking together rather than competing!) I learned to justify to MYSELF why my fee is a certain amount, why I do things the way I do them, and that’s who I must live with. Yes, you must consider what is fair to the customer but base it first in what is fair to yourself. If you are honest and are attempting to provide something of value for a fair price, let that stand. Low prices only serve to communicate to the customer that the product or service is of low quality.

Bottom line: if you don’t value yourself, your time, your talent, your resources, your learning process, your research, and your reputation, (and just as importantly the colleagues in your field) then NO one else will give it a second thought.

people not buying & mail costs – part 1
by: Barbara

To Zilvera,

I’m echoing Deb up above, for sure, along with everyone else. Here’s my timeline.

First of all, give yourself time! If you’ve only been doing this for two months, then you have a long way to go in terms of finding your market — and/or your market finding you.

What online group are you selling through? It’s doing none of us here a bit of good to try to help you if we can’t find you! That’s the first step — no matter who you email, put your web address (etsy, artfire, deviantart, blog, website, etc.) so potential buyers can find you.

I have many friends and acquaintances all over Europe who sell at local craft fairs, role-playing events as appropriate (to their style/interest — medieval, renaissance, viking, survivalists), through stores and galleries and to their friends, just like we do here in North America.

I’ve had the same problem wrapping my head around the cost of postage. It costs an arm and a leg here, too, to shop online, and to mail anything — or if I want to send anything to Europe, same costs in reverse, just like you, so you’re not alone there. But people have told me over and over, buyers don’t care. They want what they want when they want it. Look at it this way: they’re saving hours of their time dragging around malls or craft shows by buying online in the comfort of their own home, plus saving $10, $20, $30 or more in gas, not to mention paying for parking when they get where they’re going, plus wear and tear on their vehicle. $15 or $20 in postage, insured? That’s a bargain!

I’ve read various estimates of it taking two to five years to get a business off the ground. I started making PMC silver leaves in April 2008, but didn’t have enough pieces made — or that were saleable! I had so much to learn — for eight months. I started selling at a local farmer’s market just before Christmas 2008, but I made one sale, to a lady who ended up becoming a great customer and an even better friend. It took about two years to at least be able to make my table and gas reguarly each Saturday and maybe a few extra dollars. At 18 months I was able to get my finished jewellery into two stores (but that means nothing — it’s still a very, very depressed economy here and sales are sluggish).

part 2 — to Zilvera
by: Barbara

However, the great news is — as of Saturday! — at the almost-three-year mark, I’ve signed up to supply silver pendants to a craft co-op store in a large city for sale to other jewellery-makers — which was my original intent when I started out three years ago.

I track my sales and as I gain knowledge and experience and use better materials, my customers are showing they’re willing to pay the price for quality — this past Christmas, they bought fewer pieces, but what they did buy was at a higher price point. Product knowledge is not to be sneezed at — in the end that’s what they’re taking a chance on and putting trust in: your expertise.

As far as online goes, I’ve had one sale to date — to my AUNT — off of Etsy. I get a lot of response/critiques to my stuff on deviantArt — people who post on there are from all over the world. Such an inspiring site!

I was and am still like a kid in a candy store, learning all kinds of jewellery techniques and using all different materials and buying far, far too many beads that catch my eye. At some point, you do need to find your niche and specialise. As I mentioned before, you didn’t leave a website or blog address that would have pictures — so it’s hard for any of us to advise you what to do, or to give you some pointers.

If you get into anything just to make instant money, then you’re heading for heartbreaking disappointment. And with jewellery, there’s HUGE competition now. You make jewellery, sew, or paint, or do anything in life, because you love it and are fascinated by it. If you’re one of the lucky ones and you hit the zeitgeist just right, your market will find you — but you’ve got to do your part by being ready for it and you must get out there to give all the unused luck that’s swirling around and your buyers a place to meet up.

Good luck,
Barbara
www.barbaramacdougall.com
www.etsy.com/shop/artefaccio
www.artefaccio/deviantart.com

Eye-opening insights and experiences
by: Rena

I just had to post another thanks to all who are sharing such terrific and thought-provoking comments here on underpricing jewelry!

I find myself nodding and saying, “Yes, exactly!” as I read what you’re saying.

I appreciate all of you!

we have created a culture of Wamart
by: Anonymous

First of all, thank you for trying to educate artists about undervaluing their work and undercutting themselves by charging too little, but honestly, who can make a necklace for $5 if you’re using quality products? I buy wholesale, and it costs me *at least* $20 to make a necklace, sometimes more. So there is no way I can (or would) ever charge $40 for a piece of jewelry, unless it was earrings or maybe a bracelet.

I think the problem with people in this country is, we have created a culture of people who want and expect EVERYTHING to be as cheap as possible because they have a “WalMart” mentality. And this has also ruined many people’s ability to earn a decent living, because many of our jobs have left the country, and the ones that are left have depressed wages. And now with the economy in the toilet, it is tough on almost everyone. Still, the prices continue to go up. Silver prices are like I’ve never seen them before. So, what to do, what to do?

I still will not undercut the value of my work, and contribute to devaluing the work of other artists, by charging cheap prices like my jewelry came from China. Honestly, I think some people would sell more if they *raised* their prices. If you are making quality jewelry using quality products, people will not think they are getting quality if you have a cheap price tag on it.

Seed bead pricing
by: Donna

There is a lot of great advise/suggestions on this site! Thanks to everyone who contributes. My 14 year old daughter and I have been making jewelry and will soon have our first booth at a craft fair. I understand the pricing formula but how do you decide the price of an item that is made with only part of the supplies. Especially when it comes to seed beads. For example, I bought 12 packages/vials of Delica beads to make rainbow rings and bracelets. Each package cost 1.95 and weighed 5 grams. I used 1/8 to 1/4 of the beads to make one bracelet. So how do I price this? Do I sell it according to how much it weighs? I. Am. Confused! Also, does everyone on this blog buy at wholesale? Wish us luck. One more question: I have beading supplies that I have no idea what I paid for them. At the time, I wasn’t thinking about selling our jewelry so it wasn’t important to keep track of prices. What should I do??

RE: Seed bead pricing, by Donna
by: Anonymous

Donna,my advice is to figure out how much you need to charge at an hourly rate in order to cover all of your expenses. Seed beads are (relatively) inexpensive, but the work that goes into producing ANY piece of jewelry involving those is, as one friend described it, “a labor of love.” I tend to agree with her. So don’t do it by weight, do it by the length of time it took you to produce it at your hourly rate. I would NOT go below $25.00/hour. Anything less would be devaluing your own work. Also, one thing I learned from my accountant (yes, I have one now), is that you don’t bill by the minute. If it took you 61 minutes to make, price it for two hours. If that means that your hourly rate is $30.00 and the materials cost $5.00, even if it’s a pair of earrings that took five minutes to make, you’d charge $35.00 plus any applicable sales tax. Or $34.95, or whatever strikes your fancy.

If you feel like that’s over-charging for your work, adjust ready-to-wear (as opposed to custom) work a tad downward, but never lose sight of the fact that you are (I hope) looking at your profit margin. You have to charge not only at LEAST what it cost you to buy the materials to make the piece, but also what it will cost you to replace the supplies used at the current going rate. On top of that, there are costs for marketing, packaging, and many, many other factors. Also, you’re NOT doing minimum-wage-quality work, so give yourself a decent hourly rate. Factor all those together, and call it your hourly rate, and you’ll find that it’s a lot easier to price jewelry items.

I just recently gave myself a raise to $45.00/hour for custom work (from $35.00), because I finished a GIA certification that lends my previously self-taught expertise a little more weight, and because I need to recoup the cost of the tuition of getting a diploma from an internationally-recognized gemology institute. My accountant thinks I need to go above even that. We’re still crunching numbers. I may still need to adjust my custom work contract rates upward. I only “give” my work away now if it’s for a legally-registered charity, for which I can receive a receipt to claim as a deduction on my taxes.

Confidence
by: Ali

Thanks Rena, this article really makes me think. I thought that because I was new to everything, lower prices would build up my customer base. Now I know that, although I do have jewelry that is appropriately priced based on the time spent and cost of materials, a lot of my work is worth more than I give it credit for. I love making jewelry, and creating one of a kind, unique pieces. I need to take into account that if i’ve put an hour of my life and more patience than I thought I had into making a piece of jewelry, the price should reflect that, as well as the pride I have in my work. I also need to give my customers more credit. If they really do love my work and not just my prices, they’ll stay. Now comes the hard part, doing the math. Thanks again!

Ali
by: Rena

You’re welcome, Ali! :)

You’re right – it’s all too easy for us to sell ourselves short when it comes to our handmade items.

Maybe a good exercise would be to surf around Etsy and Artfire, looking at other (NOT jewelry) handmade items that you couldn’t make yourself. Is that hand-carved wooden chair worth $500? Absolutely. How about that hand-knitted sweater – $175? You bet. I couldn’t make those things even if my life depended on it. I have total respect and admiration for the skill, talent, and artistry of the people who created them.

Your jewelry skills, talents, and artistry should be equally esteemed by customers who are worthy of purchasing your handmade work.

Wishing you the best of luck! :)

Pricing Too Low
by: Wanda

Thank you for a great blog – I’ve definitely been underpricing due to lack of confidence! I recently won a ribbon at our county fair for one of my necklaces – what a confidence boost! My sister sells ceramics and has coached me on being competitive but not undercutting other crafters – or under selling my talent! Thanks again to everyone for a great conversation!

Pricing and your market
by: Kir

I agree with a lot of the comments, but also want to say that after a few years in the business, you learn your own market and should price accordingly. I started as a ‘hobbyist’ and have evolved my strategy, which is based on my own creativity – once I have made something, I just want it gone, because the most pleasure for me is in the creative process. I make jewellery using silver plate and glass, and firmly believe that everyone should have a LOT of costume jewellery!!

I would rather sell 2-3 pieces at £8-10 (at least 100% profit margin from raw costs) to a customer who will then come back for more, than one for £20-£30 to someone who might not come back again. I keep raw materials costs down by shopping around carefully, and buying in bulk where possible, also by selling excess beads to my students/online which helps keep prices down too. I have increased prices by about 35% over the last couple of years as my skills have improved, and am selling more now than ever, even in a depressed market.

I do get a little annoyed when I see for example earrings made from about 50p worth of materials and 5 mins work being sold for £7. Overpricing is ripping off the customer, and that’s not right either.
Most of my customers are local so I know how much they will pay.
I have a new range for a city shop and of course my prices to them will be higher than to my local market.
I hope that by staying low-end, price-wise, during difficult economic times, I will continue to build up a solid customer base, which will grow along with the prices as the economy improves.
I’ve gone from a turnover of £400 3 yrs ago to around £5,000 last year so I hope I am doing something right!
Good luck to everyone!
Kir

learning curve goes up, prices follow
by: Barbara

But you can’t, to echo what Kir has said, forget your base customers. At the end of November, I will officially be starting my fourth year of actually selling jewellery, and after three years my numbers are pretty much spot on as Kir’s, albeit in dollars, rather than pounds. For all of you starting out, I never would have believed I’d be saying this, but after three years I am actually starting to show a bit of a profit — I just have to rein in my spending and target my stone buying a little more. Why? As your own learning curve goes up, so does your appreciation of ever-finer semi-precious stones. D grade stones from the bargain heap just don’t cut it anymore, and I too am de-stashing at an alarming rate.

Yes, my prices are slowly increasing as a function of increased materials cost, upgrading of materials, increased skill, etc. However, the reality is we’re still in a sucky economy, and as a weekly farmers market craft vendor I have to accommodate the full range of buyers with $10 in their pockets to $100. I keep a few pricier pieces on display, but all my higher-end work now goes to art gallery shops and high end artisanal stores.

I’m still keeping an eye out for new markets. To that end I did an “alternative” bridal show yesterday afternoon with eight or ten other vendors, and yes it was the first show my cake-baking buddy Rene and I organised, and the buzz was everyone was having a blast. We know people were enjoying themselves as the brides, MoBs and MoHs hung around almost the entire two hours of the show leisurely chatting with all of the vendors, sampling food and wine, gourmet teas and coffees, unlike at “real” shows Rene and I have both been at where it’s a mob mentality that takes over and no one talks to anyone in the pursuit of getting their “passports” initialled in order to win a door prize and grabbing freebies. At which point they leave.

to be continued…

comment continued…
by: Barbara

This has become another venue that I’m now interested exploring — albeit in a limited way. My “in” was through being asked to make some cake jewellery for Rene’s sample cakes. I did a ton of research as I’d never heard of such a thing. But for me, as I have no intention of going full tilt into bridal jewellery per se, it’s another outlet, it’s the refining of different skills, inventing and riffing on new ideas to make ordering from us even more enticing with original value-adds I’m working on offering.

We’re doing a “real” corporate-style bridal show together as a team in three weeks at a hotel, so it will be interesting to see how the two of us do at this type of venue. We are also going to continue to do alternative bridal shows, perhaps two a year.

Re pricing, when I start a new line of something, I have no hesitation about asking people who come to my table what they think. I explain the technique, what the stones are, etc. I already have a notion of what I need to get to cover my costs and labour/profit, but it’s good to learn what a potential customer is thinking when they look at something.

Barbara
www.barbaramacdougall.com
www.artefaccio.deviantart.com
www.artefaccio.blogspot.com
www.etsy.com/shop/artefaccio

Targetted customer base
by: Tari Anne

I am also a newbie at this jewelry making venture, and like so many others am guilty of dropping prices when the sales just didnt come in. Zero sales at Christmas, the biggest retail holiday…made me very upset.

After reading all the comments and thinking hard about it, I have decided some important things that maybe will be food for thought for others too.

What sort of customer base do we want to attract as artists? Do we want the bargain basement Walmart groupies, or do we want people who truly value and appreciate the quality and effort of our work?

There will always be a customer out there willing to pay your price. You just have to find each other. If people gripe about your prices, then they can make the choice not to buy from you.

I refuse to haggle. My prices are firm. Haggling, to me, devalues yourself and your work and shows that you are not confident in the prices you have set if you are willing to simply drop them down to anyone who tries.

It might take time and patience to get those customers bases rolling, but it is well worth it when at the end of the day you feel that you were paid accordingly for your work.

who are we selling to?
by: Barbara

Hi, Tari Anne,

I’m so very sorry you had no sales — and at Christmas! — but been there, done that, got the t-shirt. Believe me, you’re not the only one. I sell a big fat ZERO at Christmas craft sales, so I don’t even bother doing them. I’ve given up trying to figure out why I have no sales at craft shows, but do well at the weekly farmer’s market and in stores.

You said you were new at this. Was this your first craft show? Do you plan to just do craft shows or will you try a regular weekly market or sell in a store? A year round or seasonal weekly market is something to look at as I’ve found I’m now doing pretty good re sales, and it’s a great way to develop regular customers. Just be aware that every type of selling scenario has its benefits AND its drawbacks.

You also have to look at timing and your pricing. I was told over and over — and it’s true — that people plan to buy their expensive gifts in November — and they’re starting to look for Christmas gifts in the summer now. I offer layaway, with a minimum 25% deposit. The past two years the weeks after Christmas are just as good as before: I get a lot of people buying for themselves because they’ve been given money to buy what they want.

I too get the Wal-Mart brigade insulting me over and over about my prices and how they’d seen exactly the same thing at Wal-Mart for way less. I finally got so fed up I (very nicely) tell them to go to Wal-Mart, buy the item and bring it back and show me and we’ll compare items. They give me a dirty look, leave and never come back.

What I do, though, if I see that people are lingering, is talk about how I work, and what goes into the pieces I make, and I show them the finishing, as that’s what separates my jewellery from most of the mass-produced stuff out there in the stores.

The accepted wisdom is it takes 5 years for a business to show a profit. It’s very true. It took me two years to start to sell and get my stuff in stores, and now, just starting my fourth year, I feel that I’m doing okay, given that I’m in a very small market in a very economically-hard-hit area of the country.

You also need to think about broadening what you offer. I always mentioned to people that I will do small repairs, replace clasps, add an extender chain, that type of thing, and that I can usually do it while they shop at the market. I’ve recently started refurbishing inherited jewellery which often has enormous sentimental value to the owner way out of proportion to the monetary value. It’s a real puzzle how to remake screwback earrings so they can be worn with earwires, but this is the type of “engineering” puzzle I enjoy.

Do you have a website or blog? I’d like to see what you’re doing.

Good luck,
Barbara
www.barbaramacdougall.com
www.artefaccio.blogspot.com
www.artefaccio.deviantart.com
www.etsy.com/shop/artefaccio

Bargain Shoppers – Bargain Jewelry
by: Bobbie G

I like to be able to have a “cheap” or “bargain” assortment of jewelry to sell to teens and kids. If I can get my supplies for cheap, why not pass on the savings. I have found that the “bargain” sales to the younger crowd, pull in bigger sales to the adults, and sometimes, if I didn’t have the “bargain” sales, I would go home with no money at all.
for the conflicted pricer
by: Rachel

I have high end pieces and I also have more affordable pieces that sell a lot with teens to twenties because they have a more trendy appeal as where my higher end pieces are a bit more timeless.

I hate to say to someone, well these are 25$ and this is 400$, so a good way for me to get around that line in cost that makes customers confused on it’s worth is I make a point of showing the high end pieces as Couture, and the lower priced items as pret a porter, and give it a little twist with my packaging that makes it fun and kind of punky. I don’t know why, but this works well.

A little French goes a long way.

Hope someone can benefit from my two cents :)

Rachel

Great tips, Rachel!
by: Rena

Thank you so much for sharing your strategies for your different price ranges!

An excellent insight:

Much of it is in how you present it or “frame” it to the customer.

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Comments

  1. My only two cents – Jewelry is in the eyes of the buying public expensive. They don’t blink when it comes to spending thousands of dollars on a diamond ring. So, I have no problem charging a reasonable price for my jewelry. I just look at it as this is my version of a expensive jewelry …in necklace or bracelet form and charge accordingly!

    If your jewelry is priced incorrectly the buyer feels they are buying a cheap piece of jewelry and doesn’t give it the respect it deserves! A jewelry store on the corner will price their products about 7-10 times above cost..ie an item that costs about 10 dollars wholesale will be marked up anywhere from 70 to 100 dollars.

    Your jewelry is not any less quality than the local jeweler. Yeah they have diamonds, but they also have semi precious gem stones and CZ’s and lessor beads. They may have lots of gold, but they also have silver and copper and silver plated stuff and they mark it up too.

    If you consider yourself a traveling jewelry store, or a jewelry store using a different method of delivery then you should have no problem marking up your product correctly!

  2. I am relatively new to selling my jewelry, I just started my business in January of this year and I have been devouring any article about pricing.

    Time and time again I find comments similar to those posted here; mostly that you cannot undervalue your work and the effort and time you put into it.

    One of the most recent things I discovered is the sometimes pitfall of agreeing to wholesaling. I will be the first to admit that I should raise my prices, as a matter of fact I just raised all my prices a little and have plans to raise them more (think baby steps here!).

    One of the tidbits that was just hammered home to me was that if a wholesaler viewed your site and wanted to purchase some of your items they would likely expect 1/2 or less of whatever your listing price is on your site.

    Right now my pieces are priced to make a small profit, but cut those prices in half and I’m getting paid for the materials and maybe a couple minutes of work – not good!

    I took the plunge and listed two pairs of earrings that normally I would have listed for around $30 and listed them for $58 (yes I know still not high enough but I’m working on it, really I am!).

    Imagine my surprise when those earrings became the most popular item in my shop! No, they haven’t sold, but they have lots of fans and are getting tons of views, who knew…

    So thus begins my price war I must wage with myself – guilt and undervaluing yourself is out the door and real math and formulas are in. I’m going to give it a spin and see where it takes me, my time and effort are worth it!

  3. When I started selling my work, I know I was underpricing it. Many of the supplies I used were ones I bought at full price for myself – I didn’t intend to resell them, so I was probably doubling my cost. I was also timid about asking higher prices. Now that I’ve been selling for a while, I buy my supplies almost exclusively wholesale, so I can keep my costs down. I ALWAYS at least triple my cost. Always. If it’s something with seed beads or that was quite inexpensive, I price it to what I think is a fair price. There are some necklaces for sale on my site that probably cost me $8 to make, but I charge around $70. If I make a wrap bracelet with a strand of beads that cost me $6, I charge $42. I think that’s fair and takes my time into account.

    At this point, I focus on well-made pieces with non-precious metals. I’ve recently been moving into higher price ranges. Still, if a pair of earrings takes less than 5 minutes to make and costs maybe $2, I won’t charge over $12. I’ve sold other pairs for more than twice that, but they either had higher priced materials or they took longer to make. If and when I’m able to use Sterling components, I’ll raise my prices to reflect that.

    I think there will always be people who think my prices are too high and those who think they’re too low. For me, as long as I’m making a good profit, I’m happy. The 3X formula works for me: 1/3 pays for the supplies, 1/3 pays me and the other 1/3 pays any other expenses, if there are any.

    I had a woman approach me about a necklace (one of the pieces that was way underpriced already, btw) three consecutive weekends at a regular show I did. She asked me several times if I’d go lower on the price. I said no, that the price was already as slow as I would go. After the third time, when I offered to give her a discount on the matching earrings and she still didn’t buy, I knew she wasn’t going to buy anything unless I really lowered the price. I later sold the piece for what I was asking AND I sold the earrings for full price too.

    I think that, if someone is going to buy your work, they’re going to buy it.

    It’s frustrating to do shows alongside people who sell their work for next to nothing. You just have to ignore that and hope people see the quality in your work and know its value.

  4. marlene strait says:

    Years ago, about 1996-1997 I read an article that said if things aren’t selling, RAISE THE PRICE. I was doing a show and talking to a competitor. Our designs are different and so are the materials used. I told her about the Raise the Price idea. Later in the day she came back and said ” It sold” she went on to tell me that she had a piece that had been in inventory way to long, but she decided to raise the price and try the theory. Well she sold it and the customer gladly paid the asking price. Just goes to show you don’t know until you try.

  5. This discussion has given me much food for thought. I’ve been creating hand made jewelry pieces for about 2 years now. It’s been a slow road of marketing and blogging and selling. It’s very hard for me to put a price on my items but with the tips here I think I will finally come to terms with it all ~ Thank you!

  6. I have been struggling to price my jewelry. I have found many formulas on how to price things, and make a profit, but i guess i fall into these categories
    “They don’t value their own talent. They feel “lucky” to sell one of their pieces at any price, even if the sale barely covers the cost of their materials.
    They believe their jewelry is “unworthy” of netting higher prices.”
    every time i get a price down i end up thinking “thats too high, itll never sell” and end up lowering it, and then guess what it doesnt sell!
    I recently got an offer to put my items in a store in NYC (im in CA) but dont have my prices lined up, so that has set me back and i have not been able to put my items in the shop yet, and i cant until i get my prices locked!
    im having so much trouble with this.

  7. Good topic, and very helpful! I was looking for advise for a jewelry making starter and I totally agree with your article. If the own work is not priced correctly, the chances are that the items would not sell. Lowering the price is not always the case.
    As for jewelry handcrafting which includes beadweaving or/and wirework, makes a lot of hours of working, a lot of quality materials, so the price will be higher that a regular resale item made at a factory and sold as fashion jewelry.

    I think it is hard to sell a quality item, where you put a minimum effort of 16+ hours of tidious work (beside design and creation of unique items). My ideea is to have more types of handcrafted jewelry, where you spend less time but they may look beautiful and useful, such as stringing, for a certain group of customers (youth).

    I have noticed on Etsy unique designs and beautifully crafted, but they sell on close to 1000$ as per necklace. I imagine, they do not sell fast. My thinking is to be able to create also a line of less expensive jewelry, a different style maybe and addressed to a different group of customers. That would make the sales easier.

  8. Another thought: Beware of sales of handcrafted jewelry coming from Eastern countries. Sometimes they are made of very good materials and a lot of creation and work in put into it. Yet they sell perhaps 3-5X times lower than the regular priced for similar items. I have seen that on Etsy and eBay too.
    I understood the ideea that their countries the gaining is much less, but if they sell and ship worldwide, they should adjust the price in accordance to the online market.

  9. I like to have a range of items at different prices in my online shop, so I can catch people with every budget. I’ve got some expensive one-off designs made with high end materials and sometimes DAYS of my time gone into them, I’ve got some mid range items that take a few hours and are mostly made to order, unless I’m preparing for a craft show, and then I’ve got some cheaper items that I can make within 20 mins to a few hours, and I often make a large stock of these over the course of a day or two. My wire “love” rings are a great example of this! They take me ten minutes to make, the material is wire which is really cheap as materials go and because the design is so unique and appealing, I can charge double what I normally would for my time!

  10. Linda Harrison says:

    Hi There
    I just want to say there is pricing to make a profit and pricing to gouge… There is a gal that does a few of the same markets as me that prices her neckalaces $15.00 to $25.00 more than mine and i know where she got her beads as like most we shop at some of the same places her hourly wage must be huge. Anyway what do you do in that case are people going to think my quality is not as good. This has been my most difficult challenge with priceing.

  11. Hi Linda, You’re absolutely right that lower prices tend to make people think that a product is lower quality – while higher prices give people the impression of higher quality.

    If the other gal’s jewelry is somewhat similar to yours, has similar components, and people are buying her jewelry at her higher prices . . . that means you should probably be putting higher prices on your jewelry too. You may even want to try your prices a bit above the other gal’s pricing, and see what happens! :)

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