How to compete with Cabella's

[Johanna]

Cabela's is one of the world's leading suppliers for outdoor enthusiasts.

Womens Belts

Mens Belts

Holsters

We can't touch these prices...we can offer a customer a custom item, or better quality, but not at these prices.

Johanna

[bruce johnson]

Johanna,

Great topic, near and dear to my heart. Number one, we have such a range of talent and expectations of return, we will never get a consensus. I think I saw in one of those G Hurst videos made during the first Tandy era, where he said leathercraft is one of the few hobbies that will pay for itself. That's true folks. Problem is that some people are happy to get the cost of the kit or materials back. Others charge the materials, and figure their time at less than $5/hour, ("Hey it is more than I would have made watching TV tonight"). Others double the materials and charge $50 or more per hour. And in each of these groups there are some real talented work, and some dead cows that need an apology. (Had some of my work described like that once). I am totally convinced that in the leather business especially, price does not equal quality. Everybody is comparing to a different yardstick - Walmart, Cabela's, Leddy's, Capriola's, the Cowboys and Indians magazine advertisers, or Ebay. There some $20 belts that need to be $150, and some $150 belts that should be $20, and some $500 belts that are priced right. Bottom line, they ALL get sold if they find the right customer. That is the key - selling, not pricing. Find the customers that will pay your price - consistantly. Now someone tell me how to do that, and we all get rich!!

Because some makers don't plan to upgrade tools or buy equipment, they can maintain a lower price, make enough to pay for what they have and they are done. Some of us have plans to expand, and want the money there to pay for it when the opportunity presents itself. Expectations and needs are the biggest factor for pricing. Some people want coffee money and others pay a mortgage.

I price my work like my living depended on it, but have a day job. I need them both, enough said. I markup materials, have figured my overhead, have an hourly rate based on overhead and what I think is a fair labor rate. That is what I charge. If I have to cut the labor to compete, then that is a project I don't do anymore. A business advisor told me that I need to do leather work because it is fun, not do it for fun. Somethings I do charge more than my going rate, because the market will bear it. I will give quantity discounts on some things that are all the same, and I can batch them. Still making the same amount per hour due to efficiency. One of my competitors summed it up - we need to make as much as the UPS driver who delivers our leather.

Bottom line for me - don't compete with anyone below you in quality, service, or price. Find your market, and keep those folks happy. Easier to keep a customer, than find a new one. Dang, I think I have used about every cliche my business advisor had. OK, one more. There is a rock for every frog. Some frogs like a Mercedes rock, and others sit on a Yugo.

Bruce Johnson

[Regis]

Bruce,

Your business advisor made sense. For 10 (or so) years I made and showed/sold custom gold and silver jewelry in a very large art gallery. I use 14K and up gold and sterling or fine silver as well as diamonds and other precious stones. There were six jewelers in the gallery. 4 of them strung beads and put plated fitting on the ends. My prices ran from $75 to around $800 and were priced based on material and respectable hourly wage. In the time it took me to design & fabricate a nice pendant, the bead people could make 10-20 items with only pennies in material. I did not quit my day job and, I also did not compromise my pricing just to move product (or keep up with the beads).

One of the 2D artist asked me if I knew the difference between a professional and amature artist. An amature artist has a job to support their art work. A professional artist has a spouse that has a job to support their art work. At the time, it was kind of funny. But, if it (leatherwork or goldsmithing) is a hobby, then, one should also get the joy of giving away the items as gifts. If it is a business, small or large whether starting or established, it should be run as a business. If you make fine quality then as part of sales, you need to be able to show the details and why it is worth the stated price to own it. Take pride in the quality or take steps to raise the quality until you are proud enough to show-off the work.

Enough pontificating from me.

Regis

[abn]

Find the customers that will pay your price - consistantly.... If I have to cut the labor to compete, then that is a project I don't do anymore.

Bruce, there's a great deal of wisdom in your post, but playing the devil's advocate (as I often do ), are you saying you wouldn't do leatherwork anymore if customers suddenly couldn't afford your prices?

[Art]

Hi Abn,

I think what Bruce is saying is that he would find new customers who would pay his price.

Art

Bruce, there's a great deal of wisdom in your post, but playing the devil's advocate (as I often do ), are you saying you wouldn't do leatherwork anymore if customers suddenly couldn't afford your prices?

[Art]

Hi Johanna,

I always price work at the PROFIT the market will bear; but always a profit and always ENOUGH profit to satisfy me. Since I make men's belts and gunleather (Cowboy and Duty), you would think that Cabela et al would be a worry. Not so, I am glad to see they charge what they do. At least they are not selling belts for $12. The Cabela's customer is looking for at least decent quality, and are willing to pay for it so some of them will gravitate to me if they see my product. I tell my customers the steps in making one of my belts and what is used to make them, I sell my quality. With holsters and gunbelts it is quite a different story. With the CAS crowd (that includes me) they are looking for HIGH Quality and that is what I provide with authenticity the next criteria. Cabela's just isn't into that. I don't know what it is with the pressure molding of gunleather, but on other than Duty wear it just looks cheap. Molding does make duty holsters a little thinner which for concealed carry is a plus. I do them either way.

You can make good money just selling belts and at very profitable prices too.

Art

Cabela's is one of the world's leading suppliers for outdoor enthusiasts.

Womens Belts

Mens Belts

Holsters

We can't touch these prices...we can offer a customer a custom item, or better quality, but not at these prices.

Johanna

[abn]

Yep, I know what Bruce is saying. But let's say, for the sake of argument, that no such customer existed. Would Bruce still engage in leatherwork or would he switch to another craft that provided better income?

I'm just wondering...

[Art]

Hi abn,

I don't know how Bruce would act, but I am from a school that taught you to make lemonade from a store full of lemons. I have a day job that keeps me more than happy and the leatherwork I do is more for artisanship or the artsy side of my head than anything. Nonetheless, there are more than 300MM people in this country and if you get your product out there, someone will buy it. Now not everyone is a marketing genius, but if you have something that isn't selling, you become one or you fail. If you fail, you start over doing something else.

Art

Yep, I know what Bruce is saying. But let's say, for the sake of argument, that no such customer existed. Would Bruce still engage in leatherwork or would he switch to another craft that provided better income?

I'm just wondering...

[abn]

if you have something that isn't selling, you become one or you fail.

The only reason for my post is that I'm wondering how much of a motivator money is for leatherworkers. I think it's great that we can sell our products, and the business and marketing side of it is probably fascinating.

However, I also think there are folks that just enjoy working with their hands, and worrying about markups, profit and advertising just pollutes the whole creative process. For that reason, I think there will always be craftspeople that undercharge or give away work, and there's probably nothing wrong with that.

-Alex

[ClayB]

[quote However, I also think there are folks that just enjoy working with their hands, and worrying about markups, profit and advertising just pollutes the whole creative process.

-Alex

Can anyone see me jumping up and down with my hand in the air???? That sentence sums up my feelings about selling my work. If I had to make my living as a salesman, I would wake up every morning and just puke! I have been carving leather for around 30 years now and I don't sell much of anything I do. When I first started, I sold a few belts, checkbook covers, etc. just to recover some of my costs. More of what I did has been given away as gifts. But the majority of what I do stays on my shop walls or in a pile somewhere. I learned how to build saddles a couple years ago, but I don't think I will ever be a saddle maker either. I made 5 and two of those are in my barn, and two others are hanging in my leather shop. I made them because I wanted to make them. I also have about 20 pictures that I have done hanging in my house somewhere, have given a few away, never sold one of them (yet). Funny timing here for this post because just yesterday I did take sevearal of my pictures down to a store in a tourist town where we were pouring some cement. I had been in the store last summer and really liked the store. It is a bookstore, but also sells music and art. I decided I would stop and see if they might be interested in taking some of my pictures on consignment. I have told myself that if I did do this, I was going to set my price to where I will make a pretty good hourly wage (almost twice my day job wage) The thought of going in the store really made me nervous and I almost backed out, but I made myself do it. When the owner saw my work he was really impressed and did want a couple pictures. He asked me what I wanted, and I told him, waiting for the "are you nuts" response. I was really happy when he said "that sounds really reasonable". So now I will just have to wait and see what happens. If they sell, that would be great. If they don't, I will still keep carving leather because it is something I really enjoy doing. Making money from something I love doing would just be a bonus.

Clay