Many in the business of selling handmade items argue that I should set my items at their retail price. That means, if I want $150 for my item, I should set the price at $300. That allows me to wholesale my items to stores and the retail price is fixed. Of course the $150 I want for my item consists of my costs of materials, plus the cost for making it (hourly wage x number of hours to make). The problem I've had is: What should my hourly wage be?? What is the value of my skillset?? Now since I make one-of-a-kind items primarily, I don't see how the argument that someone can look at my website and see that item listed for less holds water. However, I recently started to cast some of my pieces, and list them on Etsy. Combined with the desire to start wholesaling, it does make sense to have one retail price.
But then value is not always calculated based on materials + time to make. Many times, I price based on perceived value. I feel sometimes that is a more accurate way to price. Take the above bracelet. It is made of 18 pennies pre-1983 (100% copper). It obviously cost me $.18 to make. Hours to make- maybe 4. So the questions are: What is my hourly wage? If it's $20 an hour, do I let this go for $80? Should the cost include the cost of the hammer I used to rivet the links? Or some part of it? Some people have told me hourly wage should be many times that. What are similar things sold for? What is the perceived value? After all, not everything works via formula. Pricing is very complicated.
Should price be based on what people are willing to pay? Some would be willing to pay $300 for one of my items, others can barely rationalize spending $100. It really depends on my target market, and also depends on how educated they are about what went into making that item. I have taught classes to certain students who want to come in, make a few things, and say they've enjoyed the class. But what they realize is how difficult it is. Sometimes they want me to do things for them.
The skillset I have was not learned overnight. It's hard to rationalize what salary I deserve because I am in the business of making luxury goods. Does anyone really need a penny bracelet? No, of course not. If it's a choice between food and the penny bracelet, they will choose food. But for those with some expendable income, the choice to buy art is a wise one. Items made by artists, artisans, craftspersons, whatever you want to call it, are guaranteed to enrich your life, give you pleasure, and inspire you. What is the value of that?
What do you think??