Pricing for Success | Jewellery
Updated: Nov 26, 2020
Regardless of your area of expertise as a maker, only being a viable business will allow you to continue being a creative working in a business you are passionate about.
However one of the most difficult and critical aspects to decide upon is the retail price of your Jewellery work.
COSTING & PRICING
There are various standard calculations that work for many makers for example ;
COST PRICE of materials/working costs x2 (or x3) + Your making hours charge + Miscellaneous expenses
= Wholesale rate ( Your minimum selling price)
-WHOLESALE PRICE x2 (or x 3) + Vat ( if your retailer is vat registered ) + P&P (If you pay for this)
= Retail price
WHOLESALE PLUS PRICING
Another option is to add your required profit margin (Your wage) onto your wholesale price. This enables you to match selling price on your website to the selling price of the Retailers that sell your work, without affecting the profit margin you need to make.
Matching sales prices if you decide to sell the same product direct what from your website that you sell via a Retailer is an absolute must, in order to retain good relations and critically keep your coveted external selling arena.
REVERSE PRICING
Following your research decide upon a retail price for your item eg What is the maximum amount of money you consider someone would be prepared to pay for a piece in the sales arena of your choice. This may mean selecting a price to be competitive to similar products on sale.
- Your customer has no concern over the cost of your making/ how you earn your living, they may like your story and this will to some extent be persuasive and add a little more value (£) to your piece but only if you are a recognisable brand name.
- Customers see an item, like it and decide to buy or not.
Decide upon your top retail price, deduct the vat, deduct any commission payable, deduct all of your attributed costs of making
= The pure profit this piece will earn you per sale.
PROFIT ISSUES
What happens if you work out your retail price and you are pricing yourself out of the marketplace?
- Do you have any non material but valuable aspects about your work, such as Ethically sourced? Other influential factors can add value to your work and should be apparent if they reflect a point of difference on selling price.
- Can you make small changes to the design or production costs to be more competitive?
- Is this really a commercial piece of work, could you promote it as a bespoke or limited edition piece to add value (raise the selling price)?
What happens if you work out your retail price and it seems too cheap?
An item priced too cheaply could de-value an item in the eyes of your target customer, and affect your brand image.
Research is key to making sure you are viable and competitive and reverse pricing or Wholesale plus pricing can help you decide if and how to make changes that work for you.
What happens if this pure profit number is not enough or there is a minus figure?
Consider, how can this piece be made more cheaply to increase the profit?
- Any other methods or techniques to reduce making time and cost ?
- Is outsourcing a viable option for techniques where another person's expertise can reduce the making time?
- Can a simpler design with the same ethos make a difference and turn this piece in to a commercial line?
- Could using CAD Design and casting repeats create a more viable piece?
If none of these options works it means for this piece, you have beautiful exhibition or hero piece that you can use to promote your brand but this piece will not make you money.
- Hero pieces are still important, they prove your expertise.
- Wear these.
- They can still be sold as a bespoke limited edition pieces, which will require a different promotional strategy.
Reverse pricing is a very useful exercise that can help you decide if one of your designs will fit profitably in a particular sales arena.
ACCEPTANCE
Some designs ARE commercial pieces
Some design have the potential to BECOME commercial pieces
Some designs can only be HERO pieces, use these to showcase your expertise as Maker.
Additional Help | Related course
If you would like some individual help with costing and pricing and/or advice about the potential of a jewellery design check out this course link for details of our one-to-one mini course,, taught by an experienced commercial jeweller.
Costing and Pricing Jewellery - Mini Course >>
About the author
Dawn Meaden-Johnson is the Director and Founder of The Bespoke Jewellery Training Company, she has 25 years’ experience working in the Jewellery Industry including at Signet Retail Jewellers and almost 10 Years at Birmingham City University School of Jewellery during which time she has worked extensively with national and international clients whilst managing their Short Course Programme.
A graduate Silversmith of Birmingham School of Jewellery, Dawn still occasionally creates limited edition contemporary jewellery under the brand Dawnstorm, specialising in the use of anodised aluminium in jewellery.
