I receive a lot of questions through comments and e-mail and one of the things I’m asked most about is pricing. When you’re selling pieces as a part of your business, how do you know what number you should put on the tag? I wish I could just throw out a perfect formula like investment + labor + desired profit = price, but it’s much more of a “soft” thing for me. It’s a gut feel. And it varies so much depending on your location, the shop, the event, the piece, the time of year, the weather, your mood. Get the picture? There are so many factors.
I make a huge profit on some things (like a chair I bought for $10 and sold for $285) and I make a small profit on other things. I’m a cheap person and a DIYer, so it’s hard for me to imagine paying a lot for something and that colored my pricing for a long time. It probably still does. I’m sure I could be a bit more aggressive with my pricing, but I want to keep my pieces affordable for the average person (like me.) So, take it or leave it, here are some principles I follow.
Remember the old saying, “You make your money when you buy.” That is so true in this business. You make a bigger profit when you shop smart. I don’t buy antiques if I can’t at least double the price and I try to keep my furniture purchases less than $100. I pay more for a piece if it’s in great condition or really special. This takes a learning curve. I’ve made a lot of dumb purchases and I’m sure I’ll make more. Just go with your gut, buy things you like, and buy things that are usable and make sense for your market.
Pay Yourself. When I first started with my ornaments, I thought, ”I paid $.30 for the ornament and already had the paint, so I’ll charge about $2.00 for the ornament.” OK…that’s stupid. It took me a long time to hand paint each one, so I was paying myself $1.70 for all of that work. It just wasn’t worth it (which is one reason why I don’t paint those anymore!) Make sure you’re giving yourself a reasonable hourly rate for your work and focus on projects that will give you the most bang for your buck.
Know Your Market. If you sell at a junky flea market (between the tube sock lady and 1990′s computer equipment guy), you’re not going to be able to charge a lot for your pieces. People just aren’t coming to buy high end and expensive pieces. If you’re selling in a chic shop or at a popular antique market, your venue will support a higher price tag.
“If demand is greater than supply, your prices are too low.” My brother always tells me this after I sell out of something fast. (Have I mentioned before that he’s the one who named me “Miss Mustard Seed”?) If things are flying out of your space and you can’t keep up, this is a good indicator that you need to increase your prices or teach your toddlers how to make glittered letters and sheet music wreaths. (Just kidding. No need to call the child labor department.)
Lower is not always better. Sometimes when I price things really low, in my mom’s opinion, I’m reminded that people might think there’s something wrong with it or it’s a piece of crap. (I was going to say “junk” instead of “crap”, but we like junk around here, don’t we?) Make sure you’re not underselling yourself or your stuff.
Higher is not always better. I have seen ridiculous prices on total pieces of crap. I mean, unbelievable. Or even really high prices on things that are nice, but they’re nowhere near as nice as people think they are. Just because something is old, “collectible”, or you love it, doesn’t mean it’s worth a lot. Be realistic and listen if people are consistently telling you your prices are too high. I tend to err on the side of pricing things too low, because I want to move inventory. I’d rather sell something for $200 and move it in a few weeks or months than sell it at $300 after it’s been sitting around for a few years. It’s very rare to have something in my space for more than 2 months and I like it that way.
Ask for advice, but stay within your comfort zone. I’m always asking people what they think of a price on something or what they would pay for something. It helps me to stay in a realistic range. Ultimately, you need to go with what you’re comfortable with. You have to be proud of your product and know it’s worth what you’re asking. If you’re unsure about it, ask around until you get a better feel. Remember that you can always mark the piece down, so don’t be afraid to test out a higher number and then put it on sale if it sits too long.
I wish I could give you something more concrete, but pricing in this business just doesn’t work like that. I do hope this post helps you think through pricing the pieces for your business and gives you the confidence to go with your gut.
Do any seasoned pros have some additional advice?