When I price my piece, it feels too high

[Warhauk]

I know there are algorithms for prices our work and the one I've been trying to follow is roughly the (material + time) x 2. Then, I feel like the prices is too high so usually end up lowering it a bit further even though I suspect I am already undervaluing my time aspect quite a bit (I'm a little bit slow on my production speed but still am probably undercutting my time too much).

But then I look at the price I am trying to sell and it feels too high still. For example, pricing out a set of 4 bondage cuffs, which cost me about $10 to make per cuff, and doing the hand stitching, hand dying, etc. Even if I only value my time at $10/hr AND assume it only takes 1 hour to make a cuff (which I am pretty sure it takes a decent bit longer but I tend to have issues timing, with other responsibilities and breaks and stuff), I would be charging about $40 per cuff, where as on etsy, similar looking things (though most likely lower quality but they look pretty similar) are like $40-80 for an entire set of 4 cuffs, collar, and leash.

I am just feeling pretty disheartened trying to sell my stuff when competing with these mass producers.

[chrisash]

The other maker is probably mass producing them, I would suggest you do a trial say making 2 sets at the same time, cutting out, dyeing, edges and so on and see how much quicker it is with little wasted time

 

[chuck123wapati]

1 hour ago, Warhauk said:

 

I am just feeling pretty disheartened trying to sell my stuff when competing with these mass producers.

the leather crafters lament!!!! 

You cant compete its just that simple. They use machines you dont. You can compete with others who hand sew and you can make a better product but you cant duplicate machine work by hand and come out on top.

 A little story, the other day i took a couple holsters to a customer, while talking he showed me a pancake holster he had purchased previous to finding me. It was two pieces of 4oz pre dyed chrome tan leather , cut with a clicker press, sewn on a machine in a very basic stitch pattern that was conceived to cover about a hundred different gun shapes, edges unfinished not even beveled. Probably not 30 minutes of work to put it together including a coffee break. Whomever could make a  box full of these crappy holsters in the time i make one. Big old stamp right on the front Stamped HANDCRAFTED by!  Less than two minutes and the fellow understood the difference in quality plainly. He would have bought from me if he knew i made holsters at the time but I have all his leather work now as well as everyone he tells. And yes i can make more than just holsters for my customers. Quality will sell your work if you want to sell handmade items! but your only going to get people who want handmade quality and most of those folks know what handmade looks like to some degree. His wife went over my stitching like a detective lol. I impressed her on the stitching quality and i impressed him on the speed of the order and quality fit of the holster. 

If you feel you need to compete then by all means buy the machines and put the quality out there that they are selling. THERE is a learning curve to that also!

I will say now there are people who can make clicker cut machine sewn stuff every bit as good or better than most hand makers can. They are truly your competition!

I will also say if you cant sew as fast, cut as fast, dye as fast, as other hand makers you cant charge for all that time (other responsibilities and breaks and stuff). In the beginning your going to make substandard wages, reality is sick days don't make you money, vacations don't make you money.  You now have only yourself to blame for your success.

[PastorBob]

i normally price it material *2 + $15/ hour.  It seems to work well for me.  My main product is holsters, I can make an avenger style holster in about 1.5 hours of labor time (doesn't include dry time).  I charge about $65 +/- shipping.  I should probably charge more, but I am happy getting that and it allows me to restock my supplies.  Etsy sucks.  Marketplace sucks.  Because you are competing with mass producers.  I do have my items listed on a new site just for hand made leather products.  It is fairly new, but it is all handmade stuff listed.  It would be more for the higher end buyer I would guess.

[Warhauk]

3 hours ago, chuck123wapati said:

the leather crafters lament!!!! 

You cant compete its just that simple. They use machines you dont. You can compete with others who hand sew and you can make a better product but you cant duplicate machine work by hand and come out on top.

 A little story, the other day i took a couple holsters to a customer, while talking he showed me a pancake holster he had purchased previous to finding me. It was two pieces of 4oz pre dyed chrome tan leather , cut with a clicker press, sewn on a machine in a very basic stitch pattern that was conceived to cover about a hundred different gun shapes, edges unfinished not even beveled. Probably not 30 minutes of work to put it together including a coffee break. Whomever could make a  box full of these crappy holsters in the time i make one. Big old stamp right on the front Stamped HANDCRAFTED by!  Less than two minutes and the fellow understood the difference in quality plainly. He would have bought from me if he knew i made holsters at the time but I have all his leather work now as well as everyone he tells. And yes i can make more than just holsters for my customers. Quality will sell your work if you want to sell handmade items! but your only going to get people who want handmade quality and most of those folks know what handmade looks like to some degree. His wife went over my stitching like a detective lol. I impressed her on the stitching quality and i impressed him on the speed of the order and quality fit of the holster. 

If you feel you need to compete then by all means buy the machines and put the quality out there that they are selling. THERE is a learning curve to that also!

I will say now there are people who can make clicker cut machine sewn stuff every bit as good or better than most hand makers can. They are truly your competition!

I will also say if you cant sew as fast, cut as fast, dye as fast, as other hand makers you cant charge for all that time (other responsibilities and breaks and stuff). In the beginning your going to make substandard wages, reality is sick days don't make you money, vacations don't make you money.  You now have only yourself to blame for your success.

I appreciate the anecdote. I am definitely more interested in quality work rather than speedy work and it is nice to hear that people do recognize the difference. I just need to build a customer base and I'm sure it will take some time. On a side note, I was not aware that using a clicker press makes something less handmade. I honestly assumed that it was one of the normal methods for cutting leather and is on my list of items to get by reinvesting my profits, whenever that day may come. The stitching, I'm going to stick with doing that by hand for quite a while. I just need to work on streamlining my process and speeding up once I feel confident with my quality.

Edited December 29, 2021 by Warhauk

[Warhauk]

3 hours ago, PastorBob said:

i normally price it material *2 + $15/ hour.  It seems to work well for me.  My main product is holsters, I can make an avenger style holster in about 1.5 hours of labor time (doesn't include dry time).  I charge about $65 +/- shipping.  I should probably charge more, but I am happy getting that and it allows me to restock my supplies.  Etsy sucks.  Marketplace sucks.  Because you are competing with mass producers.  I do have my items listed on a new site just for hand made leather products.  It is fairly new, but it is all handmade stuff listed.  It would be more for the higher end buyer I would guess.

I may look into the pricing and compare it with the one I've been trying to use. It's unfortunate that we have to compete with the mass producers considering etsy is supposed to be handmade stuff only, but loopholes and all. May I ask what website you are referring to?

[DustinSmith]

We as small time leather workers do have 2 big advantages over the mass producers and thats the ability to pivot on design and products much faster and being able to offer customization and personalization. You can't go to someone who mass produces this stuff and get a bespoke holster, belt etc. And thats where we fit in, the personalized aspect of it, people will pay more for something unique

[Spyros]

This is my understanding on prices (based on 20 years of setting prices for a living):

It's a misunderstanding that you set your price.   Maybe you think you do, but you don't, your market sets the price and there's nothing you can do to change it, all you're trying to do is guess what it is and put it on the sticker.  If you guess wrong and put it too high you lose the sale, if you put it too low you're leaving money on the table. 

When you're doing your material cost + labour calculations, that calculation is irrelevant, and if you ever get the price right it is merely a coincidence.   You are turning a toy plastic wheel on your child's car seat, sometimes the car turns the way you turn, and sometimes it doesn't.

What I'm saying is: if you don't like the price the market is setting for your product, there's nothing you can do about it but change the product or the market, you can't change the price.   People go to etsy expecting to pay a certain amount, because they're shopping at etsy.  If they go to Madison Avenue in NY they expect to pay something else because it's Madison Avenue, it's a different market.  If you can't make a profit at etsy prices, don't be the random etsy guy, be the lone artisan who makes a limited number of high quality items for select connoisseurs.  I mean I just paid USD$800 to a guy like that for a pair of hand made boots.  Is it easy to be that guy?  No it's not, it takes years, but it's doable.

[Spyros]

My advice is, don't make something and then try to figure out what it cost you and come up with a price.  That's a recipe for disaster.

Do it the opposite way:  Start from finding the price that people are actually paying for something, in a specific market that you can enter. 

When you find that price, work backwards and see if you can make that thing for significantly less than that price, and only then consider actually making it.  Make a prototype, try to guess how much it would cost to make it again and again.  And if the numbers still work, make and sell it for the price you found at the start.  Maybe a little lower at the start, as you're trying to break into the market, and then gently grow your prices as you're building up your name recognition.

[TonyV]

9 hours ago, Warhauk said:

similar looking things (though most likely lower quality 

there you have it..    If yours is higher quality, you certainly have the right to charge a higher price.  sell the quality!

and learn to streamline your processes to spend less time in production to improve your bottom line.

Working in batches can help.  If you're making several sets of like items, use patterns to cut them all at the same time. Then move on the next step that they all have in common, etc.

[Hags]

I struggle with this as well. I advertise in a local online add service (CL), and stress my custom work and individual service. I make mainly chest rigs for hikers, horseback riders, bow hunters, etc. I make one of items, and use only Hermann Oak leather. I do make pancake holsters as well for CC, and guns with lights, lasers, holographic lights, and others. I do use a Cobra class 3 to sew and feel this gives me a very reliable stitch line. I sewed by hand until arthritis put an end to that. I wish I could use a clicker press, just dont do enough holsters to justify a press and the expense of the dies. I have to say I'm a retired hobbyist,  I'm doing this for a love of the craft, not as a living. I do not have a bunch of blue guns, have to use the customers most of the time so this hinders me. I do 3 or 4 holsters a month, sometimes less.

[HandyDave]

4 hours ago, Warhauk said:

clicker press makes something less handmade

Anytime you add another machine into the mix i think it takes away a little more of the handmade to the point its mass produced. But if you have certain patterns that you do alot of a clicker press and dies are a great time saver. As for pricing i never compare or try to compete witg etsy prices you will allmost allways loose. I see stuff on there that doesnt look like bad work but the prices are so low i dont see how they cover material cost. If im making something newer to me that im not sure of how to price i look around online at real leathershop websites at similar items to get a ball park. But your allways gonna get the people wanting your stuff for the extra cheap price that they seen online somewhere. I hate to loose a sell but i will not go but so low period even if i keep the piece for awhile. This is if im set up somewhere showing and selling with hodge podge of stuff. If im doin custom orders which is mainly the work i do its money up front or atleast half so materials and a little time is covered. Also one thing ive figured out with real handmade stuff is your not gonna have the same profit margin on everything. Some of the big labor intensive items are gonna take alot more time and there is a cap on how much you can expect to get for said item. But then you have your smaller regular made items that you csn knock out quick which will make up alot of the difference on the bigger items where profits are smaller.

[Spyros]

1 hour ago, HandyDave said:

Anytime you add another machine into the mix i think it takes away a little more of the handmade to the point its mass produced. 

"Handmade" in peoples' minds is really just a code word for quality, don't take it too literally and try to trace back how many machines were involved. 

When people see something stamped as "handmade" they expect the care, attention to detail, and ownership of the final product of a single artisan.  They want to know him and what his brand or mark stands for, they want to know if something is wrong he wouldn't hesitate to start over until he can sell you something he's proud of.  Nobody cares if he used an electric skiver or not.

Besides, the leatherworkers definition of "handmade", which means basically no electric machines is wrong anyway.  A machine is still a machine even if it's not electric, so technically we shouldn't even use a hand press or a benchtop belt skiver or anything like that.  And what's the point of that?  Where does it stop being meaningful and starts being pure masochism?   

Edited December 30, 2021 by Spyros

[chrisash]

Its funny that nobody has mentioned spending money on Marketing and making a brand. Quality is not recognised by many people unless they are told of it, and successful brands spend big money telling the world about the need to buy their brand. Why do people buy Levi's, Snap on tools, LV, and so forth its because they spend millions telling you they are quality items and you need to buy the best

What does a advert on Etsy or eBay tell you

[Klara]

I agree with everything that has been said (and wish I had had - and would have believed - Spyros's statement on the market setting the price 15 years ago). I'd just like to add that for me the key to a higher price is personalisation. Offering something the customer just can't buy elsewhere. Last winter I made good money on spinning and knitting stump warmers for an amputee, made to her measurements. A leatherworking colleague recommended I get a set of letter stamps so I could personalise dog collars in my booth (he adjusts the belts to the customer's size while selling). That might work for bondage cuffs as well...

The other question is: Do you really have to sell? Wouldn't it be more fun to just make what strikes your fancy for your personal use and as gifts? All hobbies cost money, some a lot of it - why should leatherwork be different? (Regarding the knitting last winter: Yes, I made decent money, perhaps for the first time ever, but it was very little fun. Now I'm doing a sweater for myself...)

If you need money, there are easier ways to get it than by setting up as a self-employed artisan! (When you are using the fabulous things you made and people are begging you to make them the same you can still quote a price. However, I am still waiting for somebody to even notice my dog's fabulous collars...)

 

Edited December 30, 2021 by Klara
Added a thought

[chuck123wapati]

12 hours ago, Warhauk said:

I was not aware that using a clicker press makes something less handmade.

There are some interesting threads here on the forum about the difference of handcrafted or hand made lol. Worth looking at them if  you have the time.  Personally ( my opinion only) a clicker press and sewing machine make it handcrafted if you want something hand made that is a bit different.

Spyros is right. The short story is You can only get what others are willing to pay. the consumer sets the price in reality and they also determine if its hand made or hand crafted before they lay down the bucks.

 

[PastorBob]

14 hours ago, Warhauk said:

I may look into the pricing and compare it with the one I've been trying to use. It's unfortunate that we have to compete with the mass producers considering etsy is supposed to be handmade stuff only, but loopholes and all. May I ask what website you are referring to?

@WarhaukIt is in my signature line.

 

And @Spyros is correct on price setting.  The customer sets the price.  Imagine driving down the road and needing fuel.  2 gas stations are ahead.  One is $0.50 cheaper per gallon.  Which one do you stop at?  The only thing we can control is the cost to produce.  I am not saying make it using cheap materials, but initially we may eat our labor costs.  Most of my sales are local and through word of mouth.  Seems like folks in small towns still enjoy buying local and love the personal touch.  This allows me to get what I am looking for price-wise.  It always helps when you are face to face and can show the differences between your product and the junk ones, as @chuck123wapati said earlier. I have made several smaller items that are unique and are quick to make.  These help cover my overhead as well as some of the labor for the larger or more time consuming hand-stitched items.  These small items are generally made from scrap.  Keychains, earrings.  Then I also make items like coasters out of rounders and cup wraps with import leather that help as well.

[Klara]

33 minutes ago, PastorBob said:

It is in my signature line.

Signature lines are only visible on a PC - or on a tablet with desktop view enabled, or what it's called. 

@Warhauk This is the site https://www.internationalleatherclub.com/

 

[chuck123wapati]

1 hour ago, PastorBob said:

@WarhaukIt is in my signature line.

 

  The customer sets the price.  Imagine driving down the road and needing fuel.  2 gas stations are ahead.  One is $0.50 cheaper per gallon.  Which one do you stop at? 

True story a bit off topic or maybe not. There is a guy in town that sells Conoco gas, his family owns the distributorship and he is the MOST unethical man on earth (IMO), he literally sets the prices for the whole town and they are high.  My wife worked for him a long while back in one of two station he owns right next door to one another. The first station is a certified Conoco station the second is a c store mom and pop looking thing. He sets the price for gas at the c store a few pennies less than he does at his Conoco station and his biggest thrill is when folks drive into the Conoco check the price on the pump then drive next door to fill up at the cheaper place. Same gas !!!! from the same person. but he gets the business and beats his competition because they make a quick decision based on two choices, both are his but they don't know that and don't go down the street any farther to find better prices.

[mike02130]

My prices seem high to me but that's because I figure, why would I buy that when I can just make it?

[Tugadude]

A lot to chew on here.  Lots of interesting comments and suggestions.

Although I haven't sold my leather goods, I've been involved in sales for the last 36 years on both the distributor and manufacturer level.  Setting prices is and has been a source of frustration the entire time.  There will always be bottom feeders, and you must resist the temptation to engage with them and their short-sighted strategies.

What I've found to be helpful is educating the consumer.  There used to be a retailer in my city that actually used the phrase "an educated consumer is our best customer" in their advertising.  I agree wholeheartedly and therefore it is partially my job to educate.  The consumer will also learn from other sources and good old "trial-and-error" experience.  And the old cliché, “The bitterness of poor quality remains long after the sweetness of low price is forgotten.” is absolutely true.  So differentiate.  Explain why yours is better than theirs.  But make sure it actually is!  Nothing is worse than finding out the competition is better than you thought, and so you have to do your own homework.

Some obvious things to focus on would be:

1.  Your skill and dedication to quality, double-checking each and every item before offering it for sale.

2.  Warranty.  Standing behind your product and legitimate issues that arise during usage.  This is obviously fraught with risk and there are limits.  Or should be!

3.  Better materials.  Again, make sure they are before claiming they are.  But if you use a demonstrably better quality of leather, then it comes at a price.

4.  Ability to customize.  Some mass merchants also customize, but they certainly have greater restrictions and/or limitations.  It is up to you to decide how much to pursue bespoke products or if to do so at all.

5.  Handling.  Does the competitor acknowledge orders?  Or are customers left to wonder whether the order was received or not?  Do they follow-up with estimated delivery dates?  Do they inform you that the item has shipped?  If not,

     then those might be ways you can differentiate yourself and your company.  Being available to answer questions about the product might be another way.  That's a balancing act though.  More time on the computer is less on the bench.

Those are some of the things that immediately come to mind.  There's other ways to differentiate such as delivery options.  Some manufacturers have very little in the way of options.  Perhaps that is something that can help you persuade customers to side with you, especially when combined with your other advantages.

[Viles]

Those prices are correct. I've had decades experience in pricing mass merchandise. $80 for all that is fine. You have to decide if you want a slow dollar or a fast nickel. Please pick the slow dollar for us makers. The margins people like Triple K and Hunter are makin are just about 15%, not much. They make $ buy buying raw material in mass quantity. 

• Make a name and brand, tell a story, people will appreciate and buy that. 
• You don't want the cheap customers, they complain and return too much. 
• If you double your price then you're just making enough to make it again. Triple that sucker at least!
• The online trick is to price high, adding in marketing, overhead, ect. and then add 15%. Then offer intro discounts and then larger ones for return customers. 
• All the things Tugadude said are essential. 

There's an American ebay company that is selling their cheap made leather for wholesale prices to individuals and it's so hard to compete. I've talked with the owner but he just want to continue selling a lot for cheap. I know the people he is buying from and they are only charging like $15 a holster because they like the make $2 per item model. 

I hope you do fantastic this coming year!

[Samalan]

On 12/29/2021 at 11:15 AM, Warhauk said:

I know there are algorithms for prices our work and the one I've been trying to follow is roughly the (material + time) x 2. Then, I feel like the prices is too high so usually end up lowering it a bit further even though I suspect I am already undervaluing my time aspect quite a bit (I'm a little bit slow on my production speed but still am probably undercutting my time too much).

But then I look at the price I am trying to sell and it feels too high still. For example, pricing out a set of 4 bondage cuffs, which cost me about $10 to make per cuff, and doing the hand stitching, hand dying, etc. Even if I only value my time at $10/hr AND assume it only takes 1 hour to make a cuff (which I am pretty sure it takes a decent bit longer but I tend to have issues timing, with other responsibilities and breaks and stuff), I would be charging about $40 per cuff, where as on etsy, similar looking things (though most likely lower quality but they look pretty similar) are like $40-80 for an entire set of 4 cuffs, collar, and leash.

I am just feeling pretty disheartened trying to sell my stuff when competing with these mass producers.

 before you start pricing ask yourself this question first, Is it a business or hobby I wish to have .

[PastorBob]

2 hours ago, Samalan said:

 before you start pricing ask yourself this question first, Is it a business or hobby I wish to have .

That's a great point @Samalan.  Sure I like getting paid for the work I do, but more importantly, I enjoy it.  I try to make enough so I can buy more leather and stuff.

[Samalan]

8 hours ago, PastorBob said:

That's a great point @Samalan.  Sure I like getting paid for the work I do, but more importantly, I enjoy it.  I try to make enough so I can buy more leather and stuff.

That's what I'm talking about you first have to know what it is you want. Buying more leather and stuff is great that's what you want and that's what your doing.