My first business lesson: learning my time isn’t free
I remember it fairly clearly — we had a new woodwork teacher in secondary school and she had heard that I had started woodturning and that I was selling my products. When she found out, she ordered 2 bowls and a few egg cups. This was one of my first orders, so looking back, I was seriously under-pricing myself, but that was me not being confident in myself to ask for the price I deserved for my work.
My teacher was seriously passionate about woodwork, and I only discovered after that she made really nice artistic pieces using a woodworking technique called marquetry, which involves cutting very thin sheets of wood, called veneers, into shapes to make a 2D picture.
I went off and made the order for my teacher, and brought it in the next week. When she asked how much it was, I quietly told her the price, quickly followed by “or is that too much?”. At this, she taught me one of the greatest lessons I’ve learned in business, and a very important life lesson in general, even though I didn’t know it at the time. I can’t remember it word for word, but this is the essence of what she said;
“You are a craftsman, and what you make is highly valuable. You need to price your products so that you are getting what you deserve for your work. And if someone doesn’t like your price, you say “that’s my price, and if you don’t buy it, someone else will””.
Whilst saying this, she had a determination in her voice that made me listen, and remember, what she was saying. I can’t remember what I did immediately after that, but it remained in my head that I needed to find the confidence to price my work fairly so that I could sustain my business. It took me a long while, but eventually I found that confidence, and an amazing thing happened — my sales shot up. People saw the quality of my work, and knew it was handcrafted, and so they started to buy it.
Of course, there have been people who think my products are wildly overpriced. I remember I was at a craft fair and a lady wandered up and asked me how much my slimline pens were, and upon hearing they were €20, she promptly told me she wouldn’t pay €2 for it, and she walked away. I don’t usually take notice of comments like that, but that one annoyed me, because she was directly comparing my product, a locally made, high quality, handmade product, to a generic product made in China. Comments like this happen occasionally, and my question to those people is “What are you comparing my prices to?”. This is usually answered with something which is mass produced, with no thought for the presentation or quality of the product, and my point is proven that my products are in a different class, and so they are priced accordingly.
I’ve also learned, however, that for every person that doesn’t appreciate my products, there are 10 others who absolutely love them. Building up the confidence to charge a fair price for my time has been one of the biggest challenges I’ve faced in running my business, however it’s one I’m glad to say I overcame. I had to, otherwise I wouldn’t be in business anymore. My advice to anyone struggling to price their work, be it handmade goods or anything else, is to really sit down and write down every single cost — electricity, travel, phone, materials, transport of those materials, marketing and promotion, absolutely everything. I even know how long I’ll get out of each bandsaw blade before it becomes blunt and useless, and that cost needs to be spread across how many products I get made in that time. I was shocked when I realised that I wasn’t making any money on most of my products, even if I thought I was.
If you’re currently under-pricing yourself, stop it, right now. I hear a lot of people giving out about retail shops taking too much of a margin on handmade products that they sell. Although these shops do take a very large percentage, you have to remember that selling everything yourself takes time, and your time is costing you. The time you’re spending on the administrative aspect of every order is time when you’re not able to market, manufacture, research, work on product development or any number of other jobs that are involved in being the owner of a company.
I’m glad to say I’ve come a long way since my days of under-pricing my products, and to this day, I think that lesson from my woodwork teacher is one of the most valuable pieces of advice I’ve received. I love what I do, but that doesn’t mean I should do it for free. Making a living from your passion is one of the greatest things you can do, and something which I plan to do in future.
If you enjoyed this article or it helped you think about changing the way you price your time, or if you have any pointers for how I could improve, do get in touch!
