How Much Do You Charge $$$$$ For A Wallet ?

[mato]

hey guys i am looking at making some biker/trucker wallets and trying to sell them

in the process of making my prototype at the moment

but i have no idea of how much to charge $$$$

i will be using veg tan leather (i think it's about 2-4 ounce??) dye finishers oil ect

have a thick chain and lobster clasp

each will have basic carving on it and just cheep fabric liner of some sort? perhaps not???

thanks in advance Mat

[Studio-N]

hello. unfortunately, it depends on your market.

While in Wichita (Wicheepa), I sold biker wallets made using the SLC biker inserts, veg-tan outer piece. Mostly they were laser engraved and color filled with custom figures. Total investment was about $20. I could only get between $35 and $45 (sewn not laced). Not much margin there. And of course they always tried to knock it down in price. But they did sell as quickly as I could make them (1 per week).

Now if selling on the global marketplace, I can get up to $75 on one, but at a slower pace.

Remember, you're competition is the cheap china import biker wallets made from PU leather. People actually think these are worth a damn, and because they sell

for about $12-$20 anything higher is a tough sell.

As a selling trick, we did have some of those same cheap wallets hanging next to the good ones. I often asked the potential customer to feel them both. I always told them that if they couldn't tell the differnce they should go ahead and buy the cheap ones. They usually took the good one.

Best of luck. Let us know how it goes.

[ConradPark]

I am really surprised by how little response it is on this site lately when it comes to getting hints and help from more experienced fellow leather workers. I can't believe that the only people watching this forum these days are people with no knowledge at all (I'm just kidding!).
Seriously though, I felt I had to give my response to this one as all of us have started somewhere and the business side of leather work is by far under rated by almost everyone that starts venturing in on the earning money side of Leatherwork.

This topic probably belongs somewhere else on the forum but here goes!

While your question is quite general (for example - if you wanted to manufacture and sell a car - how much should you charge? it depends on so many different factors, doesn't it? Same with this) I think you need to establish a few basic things first.

Are you doing Leatherwork only as a hobby regardless and people, friends are asked to buy and you don't mind to earn some extra cash?
Or are you feeling that you could do something really good with your leather work, getting a lot of compliments and interest and think your work are better than most of what you see here and elsewhere? (Yes - I know this is a bit rude but hey, if you DON"T feel like that maybe you should wait doin the business side a little).

If it is the first the answer is simple - whatever makes you happy. As long it covers the material and a few bucks extra it is all cool. I used to ask people that I didn't know what they thought my stuff was worth. After their answer I either felt that yes, I wouldn't mind selling it for this price or I felt - No way! If that was the case I would add as much as I felt I was worth, tell them my sales pitch and then ask if they would be prepared to buy it at that price. Regardless of their answer, it was invaluable as feedback from real potential customers - not friends or fellow leather enthusiasts that undoubtedly are always biased.

Now - if your answer is the latter you have months and probably years to learn about running your own business and obviously there is no short answer or simple formula how to do that - even less so how to do it successfully!
But how to price your wallet there is some guidelines.
First start to think reversed and establish what you want. Do you want to sell something simple, low cost and easily affordable? Do you want to do more customised, personalized stuff? Or high end exclusive with superior craftsmanship and exotic materials? Or something in between?
Trust me, you can't do everything so take your pick and stick to it to start with. Nothing stops you from changing it later and it SHOULD change later as you progress...

Then to get a bit of perspective start to think in dozen or twenty items at the time. How much leather do you need to buy to make that wallet twenty times? How much other material, hardware, color etc. do you need to be able to make that wallet twenty times? Now, think how long time will it take you to do twenty of those wallets? REALISTICLY! Well, you probably forget unforeseen things like delay in getting hardware, mistakes in produce, your day job getting in between (can't have a supporting own business from the beginning - sorry), private life etc. Add a minimum of 50% to the estimated production time.

Are you making it by hand or using machinery?
Handmade has the benefit of being more exclusive so you could potentially charge more, saves costs as there is minimum of machinery involved. Downside is that it takes skill and time witch does increase production cost in hourly rate. If skill is lacking it looks shit.

Machinery has the benefit of cutting production time that does save money, getting easier a uniformed look. Downsides are that machinery are super expensive, needs maintenence (more skills or another cost in repairs), takes space (need for larger studio). Take a industrial sewing machine for example. If you're planning on doing 20 wallets next month it's not worth it. If you plan to do 200 wallets next month you need it.

On top of this you need to take into account your living costs - rent, bills, food etc. Yes you do! And don't forget costs for promotion (how are potential customers going to know about you? Even Facebook is not free anymore if you want to be seen). Postage costs, packeting? Oh, and finally but not least - taxes.
So take your ALL the above mentioned costs for a month , add 10-15% (unforeseen stuff), divide it with your 20 wallets.

Then decides a profit margin. There is no rule but say 40 - 50 % for the fun of it (there is so much information to read about this online). Now you have what you need to charge for each wallet if you are going to support yourself selling 20 wallets a month. Don't think 20 wallets are much?
That's $4000 for $200 each - Sounds good to me. Thinking $200 a wallet is too much? Well, you should ask if a potential customer think it is too much. Maybe they do not. If they do - ask why! ( While some marketplaces have wallets - probably more like card cases - for 20 bucks you can find brands like Red Moon or Hermès selling wallets for $500 and more! and while they seem maybe different brands from each other they have a couple of things in common, they are both established brands/companies and renowned for superior craftsmanship in their leather goods, rivaled by few. It's all about what you're aiming for).

If you don't want to sell wallets that cost more than $50 considering your target audience, well, then you'll probably need sell 80 - 90 wallets a month. If you're going to do wholesale you only get 40 - 50 % of the final retail price so then you're looking at making 160 - 180 wallets a month just to get the same amount around $4000. And to be honest, you are not going to do 180 wallets a month to start with. Let say you can make 3 wallets a day, that's a limit of around 65 wallets a month based on a 5 working day week.
You want to make more, then again you have more costs, staff, machinery - and that means that you have to make and sell even more wallets. And just because you can make doesn't mean you'll sell. It takes TIME to build a an audience. That means you need to either sell cheaper things more in the beginning to build an interest or you sell fewer but more expensive stuff to cover the slower sale.
Either way has it's pro's and con's and only you can try out what will work or not work for you.
Now before anyone starts picking apart my guide I just want to mention that I have not really covered hourly rate. That is because it normally takes ages before you in a small business can accurately know your hourly rate any less how long it actually does take to make an item, besides I think it is more accurate to think about your limiting factors. If you know your costs and you know your maximum production rate, you'll know what you as a MINIMUM need to charge, this is where most people fail, they just think, it took me 3 hours to make this item so I'm charging $45. First make sure all your costs are covered!

I also want to mention another thing about final sale price. And origin of produce. Personally I'm getting tired of the so old and tired targeting of certain regions in the world as the home to the low quality produce. That is pure ignorance if you believe that is the case. Low price? Sure - but that is another ball game. Business taxes are lower in the UK where I live so it's cheaper to produce here than in Sweden where I'm from. That's why so much is produced in Portugal and Turkey in Europe (and low minimum pay). But is the low production cost equal to poor quality? Hardly.
And produce from Asia? Leathercraft and skill are thriving there, Some of the most skill full leather workers/studios today are based in Hong Kong (China), Malaysia, Singapore, South Korea, Vietnam, Taiwan and of course Japan. (The few real professional work that are featured on this site seems to come in majority of these countries but interestingly with maybe one or two exceptions they nearly never get much response compared to inferior work done by someone from a western country - maybe this is just a coincidence...and not because of ignorance?)
I do believe in supporting local and national (where one is currently residing) economy and both here in the UK and the USA it is 'call to arms' as I'm sure most are aware of. Does that mean it's all good value and good quality? Of course not, I see so much poor stuff being made and sold by both UK and US individuals/companies.

If anything too many leather crafters here seem too frustrated to (in their eyes) foreign produce. I think they are venting frustration but I also think it is misdirected. A low price (unless it's Etsy) might just be an indicator of ability to mass produce. It's called bussiness and lack of that sense is in general more the real answer if your sales are not going very well.

There are certain areas that one will always have difficult to compete with and there is only one solution and that is to work around it (some things are not even justifiable for you to try to compete with - try to be realistic). Can't make it as cheap as someone else? Well then change it so customers will find it justified to pay a bit more for your stuff! How to do that? Well there we have the golden egg, don't we? Don't forget that there also so many leather companies both here and overseas that are super successful. Do they complain in the same way?
Basically don't bother to look at other leather workers / companies on how much they charge when you decide your prices. Because you will most likely not know all the reasons why they charge what they charge. Think about your own costs, cover that, then see if people think there is value in paying your asking price for your item. If not - find out why and adjust.

While this wasn't really a definite solution to your question , I hope I have made your head spin and given you some ideas! Don't be discouraged - dive in. It's a fun place to be in.

Edited June 12, 2014 by ConradPark

[papaw]

Take a look in the Marketing and Advertising section lot of tips and info on pricing there.

[jmann8686]

My thoughts are you are make a one off wallet with a custom design you need to get paid for your work. If the customer is asking for a custom piece which takes time to draw up and to cut and tool then dye and then make the interior and then stitch together and slick edges and do whatever it is you do. You need to get paid for that. even if it is a hobby it still takes time and you shouldn't be working for free. Yes you may have 20 dollar into material but how much time do you have involved. Now charging $350 for a wallet is crazy. But for a custom wallet I charge no less then $90. Depending on how much they want done with lots of tooling and detail dyeing it goes up from there. Now if it a random stamp design that you did just for fun and are just making them I start those at $75.

If people want to pay $20-$30 dollars for a wallet then let them go buy an off the shelf wallet. I do not try and compete with them. I don't compete with anybody. You should not be trying to keep up with the other leather worker down the street or the next town over. You should only compete with yourself. Make each wallet better then the last. Learn from each wallet. If your going to try and make some extra cash on the side you don't want to be known as the cheap guy. They customer is paying for a HANDMADE item from a craftsmen. Just my .02.

[LTC]

$350 is NOT "crazy" for a handmade leather wallet...Redmoon gets around $400-600 for theirs and I know people are actually buying them because I see people post pics of them with all their stuff on some other forums.

So...if your wallets are as good as theirs (similar design, pockets, etc.), then $350 is not "crazy" to charge for a wallet. The problem with a lot of new people is they go out there and try to undercut everyone else making similar items to try to steal business away from others. All that does is devalue everyone's work across the board. I don't play that game -- I make sure my customers know exactly WHY I charge what I do for my wallets and precisely what sets my work apart from those selling the cheap-o stuff.

Anyway, I charge what I want to charge for my stuff...if someone wants to pay it, great. If not, then someone else will later. There is ALWAYS a buyer somewhere...just may not be able to sell several a day (which is fine because I can't make several of them a day anyway). It's all about supply/demand...

[jmann8686]

Ok so in my book $350 for a wallet is crazy. I could not charge that much for a wallet. But to each his own. I don't claim to be a pro. I'm not trying to undercut anybody. Just like you I charge what I charge I'm still new to the game. I feel like what I charge covers my work that I do. And as I improve and I get better at what I do then yes I will charge more.

[JLSleather]

Ok so in my book $350 for a wallet is crazy...But to each his own....as I improve and I get better at what I do then yes I will charge more.

In case nobody else does, I for one appreciate your integrity. You want to give a good product at a fair price - which is commendable.

These days, it's "popular" to jack up the price of basically anything (including 'poo'). Then, instead of actually IMPROVING the product, or maybe PRACTICING the craft, you just get on facsbook or tweetie and spend the time you SHOULD have been perfecting with trying to convince people that poo is wonderful, and your poo is better than someone else's poo, and everybody should buy this poo! After all, my poo COSTS MORE, so it MUST be "better" poo!

So, for everyone who actually wants to make a QUALITY product - one worth buying - thank you.

Edited June 13, 2014 by JLSleather

[jmann8686]

In case nobody else does, I for one appreciate your integrity. You want to give a good product at a fair price - which is commendable.

These days, it's "popular" to jack up the price of basically anything (including 'poo'). Then, instead of actually IMPROVING the product, or maybe PRACTICING the craft, you just get on facsbook or tweetie and spend the time you SHOULD have been perfecting with trying to convince people that poo is wonderful, and your poo is better than someone else's poo, and everybody should buy this poo! After all, my poo COSTS MORE, so it MUST be "better" poo!

So, for everyone who actually wants to make a QUALITY product - one worth buying - thank you.

Thank you.

[BAD HIDE]

Step one - look to others and what they price. Yours might be higher or lower quality, a different design, or just simply made by an individual set of hands in a first world country. Customers won't go for higher prices unless it's an obviously better product, so you have to adjust according to the market. That gives you a target price.

Step two - keep track of everything. Exactly how much leather, exactly how much time. This is tricky with one item, but it's easier with multiple runs. I've been writing down everything in a notebook while doing 20 at a time. It seems silly when you first do it, especially if you're just starting out, but writing down start and stop times for cutting, finishing, sewing, and edging - even stopping for breaks, gives you an accurate labor cost. I even made up a quick spreadsheet that I can punch numbers in, and it'll spit out all sorts of cost info. I found I've gotten a lot more efficient since I started keeping track, which leads me to...

Step three - figure out how to reconcile step one and two. Do you need to bump your price up to the next level, and increase your quality to match, or can you increase efficiency somewhere or cut material cost to keep it low.

This is kinda business 101, and if you're just selling to friends, very unnecessary. But as a hobbyist transitioning to a legit business, that's just how I've managed to work out prices.