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Tips For Your Home Jewelry Business Success

Tips For Your Home Jewelry Business Success
Pricing Your Jewelry For Profit
How to determine fair market value for your jewelry pieces
What is value?
When we look for the right quotients for fair market value and pricing, let me be clear
about the difference between price and value.
The price charged for an item is the determined monetary amount required in cash or
currency for that item or service to leave the possession of the owner and become the
new possession of the buyer. It could be $10 or $657,851.46.
What makes a person pay a certain price is the value they place on the item.
Value is determined solely by the buyer. How much time is this item worth; meaning
how many hours/weeks/months would I need to work in order to pay the price? Is the
item worth effort to me? Would my spouse leave me if I buy this new boat? Is the boat
worth sleeping alone? If I choose to travel Europe for 2 months, my children will not go
to the private school of choice for this school term. Is the experience of travel worth the
cost of the private education of my kids for a year? That answer equates to the value
you place on the trip, or the education.
Handcrafted items are largely paid for because of perceived value. You can, by using
the appropriate methods, increase the value of the item. But first, you need to have an
idea of what the item cost you to make so that the price you charge the customer reflects
profit.
PROFIT: whatever money you can put in the bank after you buy the materials, pay the
overhead, cost our your time, cost out the time of any employees working on the
project, and any reductions you offer in the final price, either to the customer direct or
to a retailer wanting to purchase from you at wholesale prices.
Determining Factors for Price
1. time – your time to make
2. creativity-your talent to design unique designs
3. materials
4. overhead expenses
5. skill to make the jewelry
Rena Klingenberg suggests in her book Jewelry Booth that jewelry artist‟s increase
profits mainly from cutting costs and learning how to buy smart. However, she also
suggests a formula that works for her and encourages her readers to determine their
own winning formula.
Possible Price Formula:
Add the Base Price (materials and packaging x4) + your pro-rated hourly rate+ 10% of
the above costs for your overhead costs = final price.
2008 www.beading-software.com
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