Here is a good formula for figuring out what to price your work:
Materials + Labor + Overhead = Cost
Cost x 2 = Wholesale
Wholesale X 2 = Retail
Now I will break down the parts of the pricing formula:
Materials
These would be consumable materials. The things you use up in your studio to make your work such as:
Clay, Glaze, Slip, Underglaze, Lusters
Labor
What do you want to get paid per hour? Skilled workers get $25 -$75 an hour….don’t under value your time.
Overhead (Expenses)
Studio Rent & Utilities, Gallery Fees & Show/ Booth Expenses
Books, Videos, Workshops, Residencies, Conferences & Travel Expenses
Etsy/PayPal, Packing & Shipping Fees
Memberships, Co-ops, Guilds & Organization Fees
Website & Advertising (Business Cards, Mailings, Etc.)
Pottery (Research and Development) I consider this part of research and development. I need to have and use other potters work to be a better potter, right? Right!
Studio Equipment (more about this in the next section)
Tools, Studio and Office Supplies (Computer/Software)
Equipment Expenses
Don’t forget your equipment that counts in overhead as well.
Equipment expenses such as:
Equipment such as: Kiln, Wheel, Slab Roller, Extruder & Maintenance
Here is how I figure out my equipment cost:
Cost of Equipment divided by years you will have it = cost per year, divided by 12 = cost of equipment per month, divided by the number of pots you make in a month.
For example: say a kiln, shelves and posts cost $5000 and you plan it have it for 10 years that = $500 per year which is $41 per month.
Then figure out how many pots you’ll make in a month. If it is 41 pots then you add $1 per pot for kiln equipment cost.
You will need to figure out your equipment cost for each piece of equipment in you studio.
These things I listed above will give you the information to give you a good starting point as to what to price your work at, but they are not all you will need. There are many other considerations when it comes to pricing your work which I will now go over.
Pricing Constraints
This can be a huge factor in what you can sell your work for and sometimes is the most important thing to consider. You can go through and figure out all of your cost and determine an amount to sell your work for and then realize that there is no way you can sell you work for what you need to get. An example is this: You make a mug that takes 15 min to throw, trim and add a handle to but then you spend 2 hours carving it and another 45 min decorating it. So that gives you 3 hours of labor and let just say you have $4 in materials in the mug. If you want to get $30 an hour for your work, then your equation would look something like this:
$3 (Materials) + $90 (Labor) + $5 (Overhead)= $100 (Cost)
Multiple by 2 for $200 (Wholesale) x 2 + $400 this is your retail!
Can you realistically sell a mug for $400? Maybe but it is highly unlikely. So, what are you to do? First of all, think about why you are making this work. Who is it for? Is it made on speculation or on commission? Are you selling in the best right market for your work? Is there a way you can make it and have less time and materials invested?
Pots on Scholarship
There is this interesting theory that some pots are on scholarship from other pots. Meaning you may not make any money or may even lose money on one piece, but you will make it up on other pieces. I think this is a very lovely and romantic thought but not at all practical. You can never be assured that a potential buyer will come back or if they do there is no guarantee that they will buy a piece that will make up for what you have lost.
My thoughts are that each piece needs to be able to cover its own costs! Each pot must pay its own way!
Market
Where you sell your work greatly affects what you can sell your work for. Selling at a farmer’s market has different price points than selling in a gallery. You need to know the customer that will be shopping at these venues and how to price your work so that it fits in the market that you are selling to. I cover this in detail this in upcoming class on selling your work.
Also, other potters making and selling work like yours can influence what you can sell your work for. I suggest you look at other potters whose work you consider to be on par with your own as far as skill level, time invested in the pieces and are selling to the same target market. You may sell your work for more than less than theirs but ideally you want to price your work similarly to theirs.
There are many other factors that can affect what you sell your work for, here are a few:
Experience and Skill Level
Someone making pots for 10 years can and should sell their work for more than someone making pots for 6 months.
The longer you make pots the better you get at it and you will build up a following, and your skill level will improve which will allow you to ask for more for your work than when you started out.
Uniqueness
If you are making one of a kind pieces you should sell your work for more than someone making the same simple undecorated form over and over.
Just be aware of Pricing Constraints that may prevent you from selling your work for what it should be sold for.
Pricing Tips for Selling Your Work
Always start lower and go up. You can always raise your prices, but it is very difficult to bring them down especially when you have to explain to previous customers why they paid more than current customers do.
Of course, this does not apply to sales or special discounts you may offer.
Consistency is Key
Always price your work the same regardless of where you are selling it. If you don’t and a customer buys a piece from you at location A then sees it for less at location B then they will not be happy. The exception to this is if the gallery or shop is the one setting the price for the work and not you. Or if you are offering a sale or promotion.
I will go into this in more detail in my next blog post on selling your work.
Don’t Sell Your Soul
No matter what else you take away from this I want it to be that you never lose your love for making pottery. If you find yourself working 60 hours a week to crank out lots of pots that have little to no meaning to you just so that you can sell them for a profit, then you need to ask yourself why are you doing it? Don’t let time in your studio become something you resent. If you find this happening to you then take a step back and re-evaluate why you are making pottery, what drew you to it in the first place and figure out how to recapture that in a way that lets you continue to earn a living.
I hope that this has helped you to better understand how to price your work in a way that will allow you to make money, sell your work, and continue to enjoy the process of making pottery. Be sure to keep an eye out for my next blog post which will focus on where and how to sell your work.