How To Put A Price On It?

[humperdingle]

I'm well away from this stage, but...

Just wondering if the pro/semi pro folks could answer this...

So you've been asked to do some work - Say a simple wet-moulded document bag - no embellishments, no artwork or carving etc.

How do you go about pricing the piece?

Materials used, time spent... What's the thought process behind giving a price?

[Cyberthrasher]

Most of my stuff is tooled, but even the untooled stuff has the same price. I charge a flat $20 p/h. I know that I'm always paid for the time I put into it and it drives me to continuously improve my speed without sacrificing quality. But, by doing that I also have to know "about" how long it might take me in order to give people an estimate. If it's something you make all the time, you'll have a good idea. There are some wallets I make that I figured out how long it takes me to do without tooling and use that as a base price.

My suggestion for you is to start keeping track of your time now. For starters, you'll have a good idea of what processes take you the longest and where you think you might be able to speed some things up. But, on top of that, you'll have a good baseline for when you do start selling things. I use an app on my phone for time-tracking called "FTS Timesheet". It's pretty cool and keeps track of individual projects as well as tasks within that project. So I can see how long it takes me to dye or tool on average and then go look it up later on the workload reports. You can also put in the hourly/daily rate for a project and it will track your exact revenue both project and task wide.

[Bob Blea]

Good morning,

Your time is going to be your biggest investment in your work. There is nothing fast about leather crafting, especially when you are carving. Cyberthrasher's advice about keeping track of your time is perfect, but you do need to look at the cost of your materials. It is important to know how much the materials that are going into your project cost. A small, simple wet molded case might not cost much in materials but start adding fancy hardware like buckles and conchos and the cost can go up quickly. For me, I lace the edges of all my notebooks, and I found out my largest material expense is in the lace itself. It's also one of my biggest time expenses because I'm not that fast at lacing! That's where Cyberthrasher's recommendation about looking at the time it takes to do things helps: I'm trying to get faster at my lacing to cut down on that itme.

Another thing you will need to consider is your market. If you sell your items at the local farmer's market you will not be able to list the same price you would if you were selling at Nieman Marcus. They each have different customers that have different ideas about what they are willing to pay. There is also a different perception about what your work is worth at each venue, like it or not. If you end up selling to people in your area, you will want to look for comparable items that are sold locally, judge how your quality compares to theirs, decide if there is anything you offer they don't, and then price appropriately. One thing to keep in mind though: Unless there are others in your area doing similar custom leatherwork, you are offering something that goes above and beyond what anyone else is offering. You can make something specific to what your customer is looking for, taylored to their wants and needs. There should always be a premium for that kind of customer specific work.

Hope this helps. Unfortunately there are not any simple answers to this question.

Bob

[humperdingle]

Hi, thanks for the in-depth answers. The question was relating more to how others already charge, not how I might do the same.

Like I say, i'm a looong way off ever charging for anything I make, if ever.

I just like to see how people price items according to what they make and their target markets.

Cheers again.

[Cyberthrasher]

Like I say, i'm a looong way off ever charging for anything I make, if ever.

I just like to see how people price items according to what they make and their target markets.

That's why I chose the hourly rate. I find that it covers everything pretty well and most of the serious customers are willing to pay it. It all works out to the standard price you'll find for custom leather work. My wallets usually end up about $160, card wallets about $60 - $80, stamped belts $80, tooled guitar straps $200ish, etc.... As I get faster overall, I'll be able to increase my hourly rate while still keeping the average prices listed here relatively close. Now that I think about it, that really does nothing for my income except give me more time to take more orders

[dragonworks]

would you charge double the time on a crazy carved and stamped guitar strap, with insane detail kind of stuff?

[billymac814]

I try to figure materials plus time spent. If its an item I need to design first that design time needs to be figured in as well. If its one of my standard items I "subsidize" the design time.

I have more overhead than someone working out of their home so my hourly charge may be higher but the minimum I shoot for is 60/hr but 80 is where I like to be. Any less and its not worth doing, I do occasionally goof up and work for less but other jobs balance it out. I end up turning away a lot of jobs that would take too long and cost the customer a fortune. I'm really starting to head towards the more standard items or semi-custom items rather than full out custom jobs as I find its easier to turn a profit that way. A lot of custom jobs get way underpriced it seems.

We can't work for free though and a lot of people think we should. I get quite a few people in my shop thinking if they can buy it factory made for 100.00 that I should somehow be able to make it cheaper?!?!? I do not understand this logic, they obviously don't understand how mass production works.

[Cyberthrasher]

would you charge double the time on a crazy carved and stamped guitar strap, with insane detail kind of stuff?

Nope. I charge flat rate of $20 p/h, so if the amount of detail they want takes 10 hours, then it's $200, if it takes 40 hours to get the detail and intricacies right, then it will cost them $800. It's all based on an estimate. I tell them "we're looking at around $240" and then get a 50% down payment to start the work. I'll usually ask people if they have a budget to work with before I start designing their work so that i can design the artwork to fit their ability to pay. This is where KNOWING how long things take you is important. Most of my straps end up in the $200 range and I make sure people know that up front, with an addendum that it could be more or less depending on the artwork. Like Billy, there have been times where I've messed up further into the project than I would like and ended up re-working the entire thing from the beginning. It's amazing how much faster you work when you're redoing a project for free

Edited January 29, 2013 by Cyberthrasher

[dragonworks]

billymac and cyberthrasher you both have answered my question very well thank you for all you helped out with. happy leathering.

Edited January 29, 2013 by dragonworks

[billymac814]

Like when you tool a belt upside down? You only do that once, at least now I have a tooled belt example piece for the shop.

Nope. I charge flat rate of $20 p/h, so if the amount of detail they want takes 10 hours, then it's $200, if it takes 40 hours to get the detail and intricacies right, then it will cost them $800. It's all based on an estimate. I tell them "we're looking at around $240" and then get a 50% down payment to start the work. I'll usually ask people if they have a budget to work with before I start designing their work so that i can design the artwork to fit their ability to pay. This is where KNOWING how long things take you is important. Most of my straps end up in the $200 range and I make sure people know that up front, with an addendum that it could be more or less depending on the artwork. Like Billy, there have been times where I've messed up further into the project than I would like and ended up re-working the entire thing from the beginning. It's amazing how much faster you work when you're redoing a project for free