Thursday, January 15, 2009

Setting themselves up for failure...

Argh! Okay, now I remember some of the other "pitfalls" of doing jewelry quite vividly... and this irks me to no end.

Take your average pair of earrings, hand-crafted by a loving artisan. Parts breakdown works like this:

-Non-allergenic stainless steel french style earring hooks: $.10 each
-Non-tarnish silver wire: $.02 per inch
-Swarovski crystal bicone: $.15 each
-Other misc. compononents: $.25 per earring

So for a standard pair of dangly earrings, it's about $2.28, but only if you use one bead per earring... add $.30 per for more beads. For argument's sake, we'll use one. And this is with crappy wire, not real silver. If you're using precious materials, expect to double that. And that's just the *cost of materials*. Even if you're really, really good and practiced, it will take you at least 10 minutes to make a pair of earrings. Even if it doesn't, consider your time when photographing the finished item and your initial "research" time while making up the design. For simple earrings I rounded it out to be 10 minutes. If you're paying yourself minimum wage, that's about a dollar right there. More if you've set the value on your time higher.

Okay, but wait... more costs to consider. Those spiffy cards you had printed up to double as business cards and earring cards? They're $.17 cents each. $.10 cents if you go with matte finish and a blank back.

Expenses like overhead on a home-based business are harder to calculate... you have to guess at how much of your electric bill goes towards running your equipment (like lights, polishing machine, or dremel) but lets go conservative and say $.25 for those ten minutes. We're not going to touch what you pay for shipping materials and Etsy/Paypal fees, but those should be built into the cost of the item too... and they are if you use the standard formula below.

Right now, you're looking at earrings that cost you $3.70 to make and mount to a card, assuming you're using minimum wage for your time. In order to pay for the stock you just used, buy replacement stock, and pay yourself a wage, you have to charge at least three times that for the earrings... and that's considered the wholesale price. Selling direct to the customer should be at least five times. So an etsy site should be charging at least $18.50 for a pair of simple, one-bead earrings. Sounds like a reasonable price, yes? You'd pay just as much for a pair of cheap molded-plastic Walmart specials, so why not something better?

Now, why on earth am I seeing sets of stitch markers in other's shops... which use two and a half times as many materials (or more) and time at a mere pittance of $5? Ladies, you are selling yourselves short... literally. You'll be losing money for a long time, covering it with your "real" job wages, and wondering why you never get ahead. If you want to use your stock as a savings account, one where you lose money instead of making interest, then go ahead.

I plan to come out ahead. If you sold every single item you have in stock, and all your raw materials, would you be able to say the same?

Not only are you losing yourself money, you are making the rest of us who did the math look like greedy money-grubbers when all we want is a successful business.

And see? Now I sound like a shrew (which I hate). It's just so frustrating for me. Almost as frustrating as it costing me $9 per four ounces of roving to produce, and seeing someone advertise theirs for sale at $9. You just want to mail-order an accountant and send them to their house. :D

No comments:

Post a Comment