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Anybody care to discuss your procedures or formulas, if any, for pricing of your products?

4K views 57 replies 28 participants last post by  huff 
#1 · (Edited by Moderator)
Taking a really close look at my pricing these days and really trying to take everything into account in terms of setting aside taxes and retirement, waste, tool maintenance, transportation expenses and everything else I can think of.

I really feel like I'm in this now for the long haul, though it's not doing much for me yet. Still making ends meet by other means but I feel it's important to set a precedent now or never, that will support me in the long run if I really plan on doing this.

After adjusting my prices recently (available on my website if anyone cares to have a look), they seem high. But they are very well thought out and actually seem consistent with those of many other makers who do work like mine. I don't have the reputation, inventory or clientele that they do yet (inventory's steadily growing). But as I said, I think it's important to set that precedent now or never.

One thing I'm finding out is that certain kinds of items would be extremely unprofitable for me to produce unless the prices were sky-high to the point of being unsaleable. These tend to be smaller items because even though they're small, they can still be a ton of work.

Any thoughts or advice always welcome.

Thanks for reading.
 
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#2 · (Edited by Moderator)
Refined work costs real money because the processes
involved consume a lot of time. Only affluent people can
afford it these days.

Some woodworkers improve their visibility by writing
for magazines. Fine Woodworking doesn't pay much
at all for writing, but the recognition is beneficial.

Some turn to teaching as well.

My philosophy is the work has to be proprietary and
stunning if you want to make some money at furniture.
That means you'll need to develop skills that make
your work stand out so much from the competition
that no client will ever be able to make a lateral
price comparison. Basically, make the work impossible
to knock-off without a silly amount of time investment
and head scratching by the person attempting to
copy it. One very successful woodworker is
known for exacting reproductions of the designs
of Jacques-Emile Ruhlmann, which appeal to wealthy
people as you literally cannot get a Ruhlmann knock-off
that's both cheap and beautiful. The workmanship
and quality is right there where anybody can see
that it required mastery to pull it off.

To my mind the best ways to do this are to master
veneering and bending and shoot for the truly wealthy
clientele. At one time, carving was relevant too but
with CNC I don't know anymore.
 
#3 ·
Loren, thanks for the input. I too have thought of teaching, writing and other academic aspects of what I do to bring in some income and build a reputation.

As a side note, I have a music degree (Bachelor of Music in Classical Guitar). Every professional musician I've ever met in the classical field (extremely high caliber of musicianship), teaches in some capacity and writes, etc. Maybe every once in a while, they play a gig and get paid well. Weekly restaurant gigs for tips help. You have to "piece together" a living from different sources.

It seems in the high-end furniture field you almost have to incorporate some academic aspect into what you do in order to survive.

Yep. Gotta go for the "richies". Gotta look and act professional I think and have your ducks in a row.

But on the other hand, I think people who are potentially interested in work like mine, are looking for something a little different and a bit more personal - a higher level of involvement or a connection to the work. If they wanted a suit and tie salesman with a name tag, they would go to Macy's or La-z-boy.
 
#4 · (Edited by Moderator)
I'd advise you to make mirror frames and perhaps
light fixtures. One of the problems of selling work
at craft shows is people will ooh and ahh over it,
then not buy it because they don't know where
to put it. Mirrors and light fixtures don't have
that problem.

I don't know about that "personal" connection. I
think that's a flimsy thesis. I used to think that
mattered more than I now think it does, having
worked as a cabinetmaker, bidding jobs. Even
though I can be charming if I want to be, in the
end the cold reality is that a lot of clients will
go for a cheaper bid. I build guitars from time to
time and while people are enthusiastic about it,
they go away when they hear a price. In the
end, they want the best sounding/best looking
guitar for their money and in general if the price is
more than a little higher than a laterally comparable product,
they will not want to buy. Marketing and endorsements
can persuade people the guitar sounds the best.
Another way to go is with fancy decoration.
 
#7 ·
Scott,
And it looks like you've already discovered that there are some projects that just cost to much to make and be able to sell it for a profit.

Every manufacturer has to deal with that (big or small), but it is very hard for the small shop to compete at times. With that being said, most woodworkers automatically think that they are too high priced on everything and they will not be able to sell their woodworking which is totally wrong. There are customers out there for every price range and it's up to us to find the right clientele for our work.

From what I've seen on your web-site, you build beautiful furniture and your prices look like they are in line with other fine crafted furniture. The problem you've probably run into is, shaker style furniture is available through so many mass manufacturers and their pricing is based more on quantity then quality.

Unfortunately, most customers don't readily see the difference either in the quality or the value you offer, so you have to find that customer or educate them.

You will also have to find your "bread and butter" items that will fit a broader base of customers; easier to sell and a good profit margin. Case goods may be something to look into. Not a production cabinet shop or anything like that, but maybe things like up-scale home offices or libraries. More and more people work from home and I always found a large customer base that had a wide range of pricing you could work with.

Again, it has a lot to do with your marketing and what you're willing to build.

Good luck
 
#8 ·
Thanks for all the responses. Clint, try being a little more honest next time.

I know the style I build in is EVERYWHERE. I never set out to be original. But one thing I think I have going for me is the fact that I cannot find anyone else in the Sacramento region who does work like mine, as conventional as it is. There are a few "Shaker inspired" makers in the Bay area and one or two in the foothills that I've seen but their work seems to be farther removed from tradition than mine. Some of it appears to be "studio furniture" - more to be regarded as art than functional in my opinion.

Of course, there may be a good and obvious reason for that; Shaker furniture is an East Coast tradition and not so desirable in California. I've contemplated this and there is a possibility I may start a line of Mission style pieces as well because Sacramento (especially Midtown) is absolutely full of old Craftsman style houses and apartments with affluent homeowners who appreciate the style.

Thinking in the long term, I know I wouldn't be happy building breadboards or lamps or mirrors. I'm willing to accept that it will take longer to reach my goal, doing what I do but I firmly believe that in the long run, it will pay off both personally and financially.
 
#9 · (Edited by Moderator)
For me to prosper as a furniture maker/ cabinetmaker I have done both commercial work and furniture of my own design on spec. Commercial work to order always pays the best. In my case it has been period correct antiques and work for interior designers. The old maxim "... manufacturers aren't worried about making things, they worry about selling things " is very true. If you get busy enough to need help, hire a tradesman over someone you have to teach.

I'm retired now and have an elec. double bass/ setup business. It's beer money really, I sell 2-3 basses a year. I build acoustic instruments as a keen amateur and sell the odd one.
 
#11 ·
Besides your website where are you selling now?

Who is buying your products?

Have you thought about wholesale pricing?

Have you contacted local interior design & decorators in your area? You can go on the internet and get a feel what those in the industry are using and buying. Or call a few on the telephone to come look at your goods.
That exercise will teach current trends for your area and what to make or lead to custom work.
 
#12 ·
beautiful stuff. I am strictly a crafter so I am looking to make a profit but making a living is impossible for that. I just try to have the hobby pay for itself so when I drop $3K on a Sawstop I know the products will pay for it eventually.
 
#15 ·
- Scott I am in the same boat as you with pricing. I would love to make a living doing woodworking and have been doing some commissioned stuff off and on and selling a few things. I think you make wonderful furniture and will do well with hard work. Good luck.
 
#16 ·
Thanks to everyone here offering their constructive, honest thoughts and opinions.

Kryptic, while I appreciate your honesty regarding my portfolio and while I did invite others here to view my website, that wasn't really the focus of the discussion here.

Additionally, I find your comment a bit rude and trust me, most people who see my work would not share your opinion. Where is your website? Where are your projects here on Lumberjocks?
What exactly is it that you do Kryptic?
 
#17 ·
In my opinion, craft shows don't pay. Now before the craft show people start attacking me, one of the main reasons that they didn't work for me was me. Most of what I make (and want to continue making) does not fit the craft show crowd. I am better off with Home Shows.

Loren is also correct in saying that you have to be unique. You can't focus on being cheap. If you're competing with Walmart, you will lose.
 
#20 ·
I have a production background and find that formula are problematic until you have enough business for full time production. A better approach is to determine the market value of your product and work backwards-determine time and materials then decide if/how you can afford to produce and sell it. Whether you should produce and sell it is an entirely different question that should be answered first. If you want to be in this full time then establish relationships with decorators and architects, they can feed you business and guide you to what sells.
 
#21 · (Edited by Moderator)
Hello Scott -

Your output is gorgeous.

Your explanations are great. They're aimed at non-woodworkers. That's good. Because other woodworkers are not your clients.

Also, writing for woodworking mags? Don't bother. It won't help you accomplish your target. The only people reading your articles and reviews will be other woodworkers. Repeat after me - they're not your clients.

As for your output being original or derivative, right now that's academic. Your output seems well made and it's attractive.

Just start making sales. Keep refining your design sense. Keep adding technical skills. Soon enough you'll become confident about your pricing. And other artisans' pricing will be less of an issue.

This is an old, old cliché, but here goes - we buy from people we know, like and trust. This means most business is done via relationships. So start cultivating relationships.

Getting back to articles - contact your local newspaper's homes section editor. Offer them three or four ideas for articles that'll benefit their readership. And make these editor's lives easier by offering them material they can use right out of the box.

Examples might be - the 7 top things a consumer needs to know before ordering custom furniture - the top 3 things to know when considering furniture in a store. Be balanced and fair. But point out that for the right person, there are strengths in commissioning custom furniture.

You get the point.

Give versions of these away on your website too. In exchange for people's e-mail addresses. Stay in touch. Don't be afraid of following up in a professional and businesslike manner.

Remember - just because they're looking doesn't mean they're ready to buy right then. Just think back to the last time you bought something with lifestyle-changing overtones. You did your research. Then you circled back a few times. You validated your decision with logic but the emotions weren't too far in the background.

So stay in touch. Continue to offer them useful information. Become someone they get to know, like and trust. You'll increase the odds of them giving you an opportunity when they are ready.

My own research will be coming out soon.

One thing that keeps coming up is as old as the hills. Remember I said it'd be a good idea to cultivate relationships? Start contacting designers and architects. Ask them what they'd need from an artisan to consider being added to their roster. Then, if their needs are do-able, be scrupulous with your word about meeting their requirements.

There are plenty of woodworkers who've built substantial and enduring careers working with designers and architects. It's not the only way to run a business, it's just one way. But it's your business. So make sure your methods suit your personality and temperament.

Howard
 
#22 · (Edited by Moderator)
Scott - like the work, looked at your webpage, and pricing didn't seem high at all, except for your small dovetailed bookcase.

Understand a lot of time to make the top of the book case with the hand cut dovetails.

But to me a small bookcase would be less expensive than the hall table and coffee table, and more than your dovetailed display shelf.

I look to what people can buy such pieces for already - look at Ethan Allen and high end production furniture, then look to what you are doing is better, or about equal to these, and how to sell it.

Because you need to convince folks that you offer something unique, that they should WAIT for you to build, versus having it delivered Thursday!

Ikea is not the benchmark, there are certainly many high end furniture galleries in sacramento, where the riches already buy their stuff.

Go there, and see what they are paying today, and then consider your position. Remember, they have more overhead, a professional sales force and a showroom to keep warm in the winter and AC all summer etc. But while your work is nice, your name isn't a known niche yet, like a Maloof, so you will have to compete against the instant delivery versus you providing custom solutions - because the actual home owner doesn't really know what is possible to voice what they want.

Get together with some of the interior designers, and show them your portfolio. The true riches never shop themselves, they hire a decorator/designer - who would commission your work on behalf of their client.

you don't really knock on Clint Eastwoods door and say "interested in a new coffee table"
 
#23 ·
Scott, Excellent work and website. Don't listen to any negative or discouraging comments. Howardintoronto & drdirt nailed it, along with many others here. Building relationships, getting your name out there and an excellent product = sales. Have products for sale in all price ranges to cover the total market. Do something very elaborate, over the top and get some press. Have a " groundbreaking business" story done about you and your work. Another thing you might do is donate a piece to a good cause. Have the business promote a raffle, you do a meet and greet and get some press. Do it annually. Get your name out there. Go gettum!
 
#24 ·
I agree also that smaller items are tough to make a living at. Nice jewelry boxes can take more hours than people realize. I can build furniture pieces with the same amount of time. Much easier to get people to spend on a dresser what they won't spend on a nice jewelry box.
 
#26 ·
Though I appreciate the feedback regarding my website, I think this thread got a bit off topic. More interested in other people's pricing strategies, ways of calculating prices, etc.

Honest critique is fine but again, please see my original post. A few negative comments on here have left a bad taste in my mouth but maybe that was the intention.

I also felt an urge to clarify that when I said I'm "still making ends meet by other means", Those "other means" are being a professional finish carpenter with a solid 15 year resume. I'm booked with work for the foreseeable future and though it may not be fine furniture, much of my work in that regard is performed at home, in my shop where I operate as Barringer Woodworks. I haven't had a boss in a long time now.

Not trying to brag. It's just to say that the furniture is really just an extension of what I've done to make a living for 15 years now. It's not like I've suddenly decided to quit my office job to go join a circus.
 
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