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Topic: Price Increase  (Read 1306 times)
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shadojake
« on: June 18, 2014 06:33:44 AM »

Hello Everyone,

I am considering a price increase for my coasters.  They have been at the same price for over a year.  Currently I am selling them for $20/set of 4.  I back the tax out of that price so the actual price is $18.35 (9% tax between state and local).  The coasters are tumbled travertine and I apply all the designs myself.  My cost of supplies is about 1/4 of my retail price.  That cost does not include my time.

When I wholesale to a local retail store, up to 3 stores now, I wholesale them for $12.  I feel that is my absolute minimum wholesale price.  Local stores around here usually keystone or keystone + 10%.  So there are retail stores in my town who are selling my coasters for $24-25 per set.  One store has been selling my coasters for well over a year & has made multiple reorders.  This is the design they carry ... http://www.customcoastersbycindy.com/Classic-Monogram-1005.htm.  Of course, I have the whole alphabet available, this is just a sample from my website.  The other two stores are recent additions to my wholesale accounts and   have not had sufficient time to reorder yet.

I would like to increase my retail price either to $22 or $24 per set of 4.  Dh seems to think that if I do a price increase I should go ahead price them at $24.  How do I go about deciding how much of an increase is too much?  Even at $20, a $4 increase is a 20% increase.  Is 20% too much?  I feel at $24 that I could comfortable leave my price alone for at least another year.  At $22, I am not so sure.  I would still back out my tax.  Using even dollar amounts makes it easier at craft shows, no need for coinage to make change.

Please give feedback on how to decide is a fair increase.
THIS ROCKS   Logged

God Bless,
Cindy

Given enough coffee, I could rule the world!
Chris in VT
« Reply #1 on: June 19, 2014 03:33:42 AM »

Hi Cindy,

We struggled with the exact same problem before our 2014 show season started. The price of steel has gone up dramatically and we were not making as much profit.

So we bit the bullet and raised the prices an average of 20%. It didn't hurt sales at all.

Chris
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There's NOTHING at a craft show, or on Etsy, anybody NEEDS. NOTHING.
shadojake
« Reply #2 on: June 19, 2014 06:04:08 AM »

Hi Cindy,

We struggled with the exact same problem before our 2014 show season started. The price of steel has gone up dramatically and we were not making as much profit.

So we bit the bullet and raised the prices an average of 20%. It didn't hurt sales at all.

Chris

I am glad to hear your percentage increase is what I was considering and you did not see a dent in your sales.

I usually look at etsy and pinterest for inspiration and part of viewing what others are doing is seeing their prices.  I felt for a long time that I was high compared to those sites.  I have read that crafts people tend to undersell their products there, so I take their prices with a grain of salt.  However, it is hard to find similar products to what I sell on other sites.  Though I scour the internet, it is hard to find truly similar products on other independent websites, thus is it hard to do accurate price comparisons.  It is not that I am wanting to be like everyone else in what I do, because I do want to offer something different.  Otherwise, why do it, right?

I am leaning toward going to $24.  Barring a severe jump in tile prices, I will be able to leave my prices there for a while.
THIS ROCKS   Logged

God Bless,
Cindy

Given enough coffee, I could rule the world!
DaedalusLabyrinth
« Reply #3 on: December 29, 2014 06:15:19 PM »

Price increases are a funny thing. We need them to survive, and we are so afraid of doing them. I've been raising my prices almost annually for the past four years as I learned what people were willing to spend. Craft shows are great for this kind of thing. I've raised my average sale over 300% in the past two years.

The funny thing about prices? Subconsciously people believe price=quality. You may see that people respect your product more at the higher price point, even though it didn't take you any longer to make.

And there is definitely some benefit to at least matching the prices your retail buyers are using. It would be nice for them to know that people aren't leaving their store and buying direct from you at a lower price. I set a suggested retail price that I know most stores can handle (generally double the wholesale price) and tell them that.

How did you season go? Are you doing any bigger shows next year?


Jennifer
« Last Edit: January 08, 2015 10:00:27 AM by jungrrl - Reason: edited to comply with Craftster guidelines » THIS ROCKS   Logged
shadojake
« Reply #4 on: December 29, 2014 06:38:16 PM »

Jennifer,

I am not sure if you were asking me about my season or not.  But here goes anyway .... Wink

I went from $20 to $24 per set of coasters.  It does not seem to have hindered sales one bit.  It does give me a bit of leeway if I want to do an occasional discount, more leeway than I have felt in the past.

What is funny is this, well maybe strange.  I was at a locally owned upscale store in my town.  (I do not have any product in this store.)  I had never visited it so one day dd and I went in to look around.  Their hours of operation are very limited so that is part of what hindered us going there.

While there I noticed some stone coasters for sale in sets of four.  The appeared to be painted a solid color on top, with a contrasting color around the edges ... a very plain decorative effect.  Almost boring.  No, it IS boring.  Out of curiosity I turned over a set to check the price and to see if the "artist" was mentioned.  They were priced at $40/set of!   Shocked Shocked Shocked Shocked  I almost FAINTED!   Shocked Shocked Shocked  Did I say I almost fainted?  I broached the subject of whether the owner had any locally produced items for sale in her store, careful not to single out the coasters.  The employee mentioned one or two and then said the coasters were done by a friend of the owner.

What I wanted to say is that the owner is getting ripped off.  Based on keystone she is paying $20 per set.  I would sell her mine at $13-14 per set and she'd still be making a profit at keystone on them.  They would be prettier, at least have some thought put into the design.

I may go there one day and just talk to the owner with a few samples.  She may not like what I do but some of her customers might.
THIS ROCKS   Logged

God Bless,
Cindy

Given enough coffee, I could rule the world!
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