Monday, July 9, 2012

Handcrafted Pricing - What your $$($!) is paying for.

Well, here we are, around three weeks off of our official re-launch on July 28th and I've been thinking it's time to start generating a little more interest and traffic around our various social network portals!

I thought I'd spend a little time today writing about what your $$($!) gets you with regard to handcrafted items.  A lot of the time it's easy to take a browse at a local market and think "Geesh, how much?" or "Man, I could totally make that myself".  My personal attitude to the latter is that if you can then DO, however, have a think about some of the things I mention below before making your assumptions on the work/time/money involved in bringing you these truly unique and beautiful handcrafted items.  As a side note, I think this blog might also be quite insightful and useful for anyone looking to start up their own small home-based business.

Most of these principles will apply in some respect to other small businesses and crafters but you'll get the general idea so please bear in mind I'm writing this from the perspective of a (very!) small-scale clothing manufacturer who is also a full-time single mommy to two littlies aged 3 and 5 - my time is precious and I simply cannot emphasise enough how important it is to consider that the cost of items does not come down to only the price of the fabric used.  In business TIME IS MONEY.  I mention time a lot in the following blog.  If you actually thought about the amount of time mentioned below and calculated it on an average hourly wage of, say $18.00/hour - you'd be able to see exactly how much the seller is 'selling themselves short' to bring you this quality non-sweatshop/mass-produced item.

I'll start with the very basics - producing the actual product - I'll run through how I make one unique item totally from scratch (whilst as basically as I can!), the time and money involved etc.

PRODUCTION COSTS - The time and money involved in producing your garment
First things first I need a design.  I get an idea in my head of what I want to produce and then I research, research, research.  This involves collating various design ideas and sketching my heart out until I have something I'm happy with.  Next I need a pattern - this is by far the most time consuming aspect of the entire garment's construction - it is actually illegal to use shop-bought paper patterns without permission for commercial use - luckily in my case I have two years of full-time professional training under my belt and have a fair amount of experience in pattern drafting so this saves me a chunk of time of the actual testing of the pattern which is the next stage.  Each of my new designs are mocked up in calico and adjusted as required.  Sometimes I'll do this two or three times trying out different methods of putting it together to ensure I find the most time efficient techniques whilst still producing a high quality item.

Now for the fun part (for a fabricoholic like myself) - it's time to source fabrics.  It's actually really hard to find excellent quality fabrics at the right price.  Unless I find a truly exceptional poly-cotton print that I just cannot walk away from I almost always use 100% cotton.  So far I haven't needed to import from overseas as I've always been able to find great fabrics locally.  Keep in mind that if you're looking at buying fabrics wholesale from the big importers then you'll be looking at minimum spends.  I know that one of the most popular suppliers in NSW requires a minimum of $1,000 initial spend to open an account with them.  That's a big hit for a small home-run (hobby-based) business and whilst it'll save you money in the long run most small businesses (such as myself) simply cannot afford that kind of outlay in the early stages of production which is why we usually end up paying $$ per metre of fabric which is again reflected in our production costs.

Next you need to consider the time it takes to make up an item - this includes the actual cut of fabric and production to the point where it goes on a hanger.  Some items can be very quick to make - basic forms of pillowcase dress, simple no-pocket pants etc.  Other items are more complicated - once a pant incorporates a fly fastening or a collared shirt for example.  Most fitted dresses will require invisible zippers and perhaps even boning to the lining.  Jackets require buttonholes, buttons etc - also consider a lot of items will have some if not a lot of hand sewing to ensure a high-quality finish - all of this takes time which costs $$.

The final stage of actually producing a garment is quality control.  I spend a fair amount of time going over each completed item to ensure there's no loose threads that all my seams are tight and my finish is of good saleable quality.  Each garment is pressed, lint rolled and tagged before being dust covered and set aside for market day.

Everything in this world costs money.  In order to comply with strict industry guidelines any item of clothing requires relevant labelling - labels cost money and whilst care labels and size labels can be bought relatively inexpensively, if you want to brand your business effectively (which, in my opinion should be a priority) you'll want to get good quality woven labels made up for your garments.  Next, stationary - every business needs business cards - I'm quite sneaky in that I've designed mine to be used as both business cards and swing tags for my garments.  If you're going to design your own then take the time to consider branding effectively.  This takes TIME.  

Setting up a business isn't cheap - especially if you plan on doing it to a professional standard.  If you have skills in accounts, graphic design etc then you are likely to save yourself a lot of money and you can reflect that in your production costs.  Most businesses will benefit from getting financial advice early on which can get expensive.  If you're going to do things properly then you need to consider all of the following which all cost money:  business name registration; trademark registration; graphic design (I cannot stress enough how important branding is!!!); website design; website hosting fees; email hosting fees; accountancy fees (at tax time, eeeek!).  All of these costs are ongoing and can cost you $$$'s - something to bear in mind if you're considering starting up.

If you plan to sell at market then there's a massive variance in the costs involved.  Think hard about the audience you want to target.  If you consider that your item is high quality then you want to sell with a market that reflects that - is a $20.00 stall fee really going to get you what you want in terms of customer quality?  You can expect to spend between $75-$150 for a 3x3m pitch at a high quality, reputable market (personally I feel if you're charged any much more than this then you're being ripped off, but that's just my opinion!)- then you need to consider the equipment you need - gazebos (don't get a cheapy one - outdoor markets can get windy - not only do you risk your own merchandise but that of your fellow stall-holders.  Keep them on your side, you might need them to watch your stall when you go pee!)  Next time you're at market, take a look around at the equipment stallholders use to display their items - then take a moment to roughly add up the cost of all these 'nik-naks' - you might be surprised at the outlay a small business needs to make in order to display their goods effectively.  Finally, there's the hidden costs of markets such as insurance - AAMI charge about $200 a year for market insurance and almost ALL market organisers require that you have some form of market insurance).

I haven't even touched on the time it takes to effectively market your brand through various mediums such as magazine advertisement, editorials, customer interaction on blogger, facebook, twitter etc - nor, as in my case, the cost of sending me to design school for two years (bless my parents, I can only imagine how much of their hard earned cash went on 'Burnt Ochre' Designer Gouache *rolls eyes*

I hope this little blog helps to give an insight into how us 'crafter/businesses' we come up with our prices.  There really are so many different factors involved in bringing you this unique product and it really is unique - these items aren't mass produced by poorly paid workers overseas - by buying handmade you really are supporting something which is so much more personal, local and special and whilst it might be a little more expensive than buying from the high-street - you can see from my ramblings above that our prices are really very justified (and realistically should probably be a lot higher when you consider the $/hr).

I would love if my fellow crafters could share this blog amongst their own fan bases and readers.  It's so important to highlight the work that we do and the passion with which we do it.  It really is time that the handmade industry stopped selling themselves short.  As the saying goes 'you get what you pay for' - and this really is true in respect of handmade items.  SHARE SHARE SHARE!!!

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