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.

[ETW Grumpy]

Redmoon gets around $400-600 for theirs

They also sell a piece of brass dog leash with a couple of clips on the ends for $135. Really? That whole "fool and his money thing." I understand what LTC is saying and yeah, If you can get it, get it, just look at Pro athletes for example. (No hate mail please, it's just an example). I also agree with jmann in that I could not charge that for a wallet even if the quality was that good.

To ConradPark, That was an excellent explanation of micro economics for the craftsman, I learned several things myself. May have to start charging $350 for a wallet after all.

Finally, to the OP, Conrad's explanation is very good and you should consider the principles involved, and BadHides response was kind of a rubber-meets-the-road distillaton of Conrad's. Both good answers for sure.

My bit of advice is if you are going to compare the prices of other leather workers producing items similar to yours, you should really look at local craftsmen and try to find out how long they have been doing this and compare other variables like time, shop rate etc. Comparing your price to other craftsmen in other places is kind of apples and oranges because you don't have access to the data; labor rates, tax rates, cost of material, cost of living etc. Just my $.02.

I like badhide's suggestion of keeping a record of start/stop times and all that. That's the only real way to know the specifics. As my last employer stressed repeatedly, "It's all about the data. Without data it's just a rumor." (Always hated that statement.)

[LTC]

Your customers are not the same as my customers.

You have your market and I have mine.

[rawr66]

The first thing you should do is price out the wallet's raw cost. Find the cost per square inch, add for hardware, and add for waste material. Then put your cost on top of that. Not every wallet will cost the same. It depends on the type and amount of leather used.

[dragonworks]

I get $75 to $100 for the wallets I make. People actually see, feel and smell them when picked up. They instantly take their old wallet outand compare how hefty mine is , how solid, well made......they always snort the thing like its heaven or something. A few have told me they would pay $200 if I actually charged that.....but im not a theif. They work hard for their money as do we all. I make it worth my time....sometimes....sometimes I just get carried away as the one I just posted. Lol

[DavidL]

if Company A can turn out 4 wallets for $60 ea, Its the same as one wallet by company B for 200. Also provided that company A has 4 times the buyers and is machine sewing rather than hand stitching.

If A company can sell 400 wallets a month its the same as company B selling 100.

However if company C can sell at 300 a wallet, the process takes as much time as company A and they have as many buyers as company A then they have the best scenario. Which is what leatherworkers are more keen to look for since they don't have as much resources, time and employees as a big company like Roots for example who sell leather wallets and bags.

If your out to make the best of your company then its a war against every other company that sells to your audience. Where the consumers have a choice to buy from 3 or 4 different companies, you have to beat out the others by the things listed below.

The most important aspect is if people see your brand as better than the competition, are there any designs or products that you can't find anywhere else? Does the company feel like a professional company where you are assured the products are high quality? Is this brand popular? Is it worth my money? Does the product fit my lifestyle?

You should have the answers to all the questions yourself and try to create your brand through your vision, using your business strategy combined with marketing tactics.

To add to the pricing discussion there is a market for 5 dollar shirts, 20 dollar shirts, 100 dollars shirts, 1000 dollars shirts. All selling to different classes of people. Low class- middle class- upper class.The more reputable your brand the more likely you are able to sell the higher end. The higher end you sell the higher the profit margin. Wallet could cost 20 dollars to make and sell for 400.

At the end of the day a seller that sell 15 dollar shirts can make more revenue than the company selling 100 dollar shirts, so pricing is not indicative of a better company.

Edited July 12, 2014 by DavidL

[tassiespirit]

There is much to think about, but another thing is what does the customer want? Does he/she want a wallet that is heavy solid and strong or softer thinner and easy to place in the pocket( and which pocket - pants or jacket). i.e. who is your target market?

It is easy to say here is my item, but then to find out that is not what the buyer wants in your area.

It takes time and effort to get the message out there and get feed back. Also, maybe the way you present your wallet to them helps, like wrapped in tissue paper and placed in a correct sized box ( yes it adds to the cost) but will show the customer that you respect what you make - it's one of a kind, hand made heirloom.

Well , it could be but I think you get my drift there. I am only doing stuff as my health will let me and it is low end stuff and limited runs. In other words sold little but I have gotten some great feedback.

Edited July 23, 2014 by tassiespirit

[Bullfinch]

Hello everyone! I'm new to your forums, but after reading couple of different threads here I know this is a great place to learn.

Thank you ConradPark for taking your time to post such a detailed answer. I was wondering for a while now, about a prospect of pricing what is still just a hobby for me. It helped me a lot to get a persective on my ideas of pricing :}.

[Jimmy McLaughlin]

I only make belts and small cases for friends. I find it hard to see how anybody can make a profit doing leather goods. I give all you folks who do this for a living credit. Especially the real artist among you folks, I have seen things on this site that are truly beautiful. I love this site, keep up the great work that you all do.

Jim

[ConradPark]

This is not an reply to anyone in particular, even if it might bring up things that have been mentioned above. Just an (several years later) add on to my earlier post.

Business is business, and with that I mean that it's a skill and learning experience that sometimes takes years - regardless if you have an education or not - to succeed with. But running a company, even if you're just self employed, is such a far step from having a secure day job and then just meddling with something as a hobby. Just in the part of East London where I have my work studio (there are around a dozen professional leather workers that all have their own companies, either self employed, or with one or to employees, that I share work space with) there are at least a few hundred businesses that revolves completely around leather, everything from suppliers of material, to bag and accessories manufacturing, to design studios and craft studios, like the one I'm in, to clobbers, bespoke shoe makers, saddlers, upholstery shops, and the list goes on and on. And I'm talking about the local neighborhood now. So here must be a few thousand people that make a living of working with leather in one way or another. I have had my business since 2013 as a full time occupation, but of course it took many years before that to be able to completely support myself. Hard work and finding a niche that you love and learning about business, basic accounting, marketing etc. especially the boring stuff, because they are often the most important.

One thing is for sure, and this is about anything in life - if one think something is NOT going to work out, you're probably correct. It is only if you really want something, that there is a chance for it to happen. And most likely you will fail and have to try again, and adjust and try again several times to succeed. Sounds like it is nothing you want to do? Well, then just enjoy doing it as an hobby! Simple.

Edited February 20, 2017 by ConradPark

[bikermutt07]

I never want to be a business owner again. I like playing with my leather. I like making what I want as slow as I want. It will stay fun at this pace for decades. I sell a few things now, but I will never try to live off of my hobby again.

I once had a motorcycle magazine. I rode my bike all over covering events. Sometimes three a day on weekends. Sure sounds like fun, right? Wrong. Watching everyone else having fun while you are staying sober trying to promote yourself to hundreds of people one at a time over and over just to speed off to the next place and do it again and again. And it didn't matter what the weather was like, you "had" to ride. I put a lot of miles on my bike doing that. It totally ruined riding for me. I haven't put 2000 miles on my bike in the last 5 years. As a matter of fact, I am so over it I have my bike up for sale.

Turning what you love into a business is not a good idea, unless you also love business. If you just want to love what you do, keep doing it for someone who loves business.

.02

[Mattsbagger]

Yep. Just selling to cover the cost. More or less.lol

[Mattsbagger]

Yep when I was a O/O of a semi you learned to hate the thing you spent over 100k for. Get off the road time to fix stuff,change tI respect, change oil, brakes. And on and on and on. Now I drive for a company and let them worry about all that stuff. I just drive the truck.

[bikermutt07]

4 hours ago, nstarleather said:

Yeah that can happen, lots of people tend to envy those of us who run a business without knowing what's involved.  I tell my employees, that they don't realize what a blessing it is to be able to "leave work at work" which is something no business owner can ever do.  We have to be thinking and working and working out problems in our heads long after business hours.  I do enjoy it, and make sure I set some limits so it won't take away all my "down time" or priorities, but I'm able to do that because we're pretty well established, and I don't have to invest the time and energy into it that my Dad did when he started. 

Right. Just for reference, anyone thinking of starting a business should read "the e sqaured revisited". This will give you a great insight into how tough being a business owner can be.

Also, keep in mind, no matter what they say on wall street people are still nervous about spending money. I think everyone's idea of money spending changed in '08. No one that got left out in the cold in '08 is going to let that happen to them again.

This makes opening a business that much more difficult.

[Mark Peters]

On 7/11/2014 at 11:47 PM, DavidL said:

At the end of the day a seller that sell 15 dollar shirts can make more revenue than the company selling 100 dollar shirts, so pricing is not indicative of a better company.

With all due respect, the goal should be profit, not revenue.

[ConradPark]

Thankfully there are a plenty of companies and also a new wave of small businesses, that even though the rules of trade and profit still apply for us as well, the main goal is actually not 'as much profit in any way' but rather quality, craftsmanship, preservation of traditional skills and as good goods as possible as well as making enough profit to keep going, but never to compromise. Most of us might not make as much as if we choose the mass producing or outsourcing model that most businesses choose to do, but we are proud of what we are achieving and we know that we would never want to do anything else. And we don't need to make excuses to why we are in this business. It's just about the love of making the best leather goods produce as possible.