I’m in several art groups throughout different social media platforms. A common question I’ve seen regardless of medium, is “HOW do I price my work”?? Pricing your art is a very subjective question. There are SOOO many different things to take into consideration.
- Are you skilled in your craft?
- Have you been creating for more than five years? 10? Or are you a newbie just starting out?
- What is your market? Are you in a rural setting and plan to sell at local shops? Or are you braving the interwebs and throwing yourself into the worldwide market?
- What is your technique? Is it unique and different than what the market is saturated with?
- Do you plan on gaining gallery representation?
- Are you going to sell wholesale and/or consignment?
- What is the cost of materials?
- How much do you value your time?
These last two points made from the list above are most important when you first start pricing your art/products. You need to make sure that your bare minimum price – your WHOLESALE price – covers your material cost and that you pay yourself. I know many budding artists start themselves out at only $5/hour for the time spent creating their work. At today’s rates, that means that the artist/craftsperson is paying themselves lower than minimum wage. If you undercut and under value yourself, so will your audience; the perceived value of your work will also suffer as a result. If you don’t take yourself seriously, why should a future collector? At the very least, you need to pay yourself minimum wage.
Now that you’ve accounted for material costs – ALL materials including a rough estimate on paint/glue/glaze used – and put a value on your time; you now have your wholesale price. This is the lowest price you should ever sell your work. Even with discounts and commissions. If you intend on trying to sell your art in galleries, you need to keep in mind that they take on average 50% commission. There are some smaller galleries who only take 40% while others will take 60%. But how does that figure into determining your retail price?
With the gallery or storefront keeping a 50% commission, what that really means is that it is 50% of the retail price. If you want your take home pay to be the wholesale price you established earlier, you actually need to double your wholesale price to get your retail price. The (very) basic formula(s) will look something like this:
(time) x (hourly wage) = (labor)
(material cost) + (labor) = (wholesale)
(wholesale) x 2 = (retail)
(10 hr) x ($10/hr) = ($100)
($25) + ($100) = ($125)
($125) x (2) = ($250)
Wholesale VS Consignment
Now that you have determined your wholesale and retail costs, you need to decide what kind of accounts you are looking for. There are wholesale accounts and consignment accounts. Your take home pay will typically be the same regardless of which method you decide is best for your business. The biggest difference is WHEN you receive monetary compensation for your work. When you establish wholesale accounts, the vendor purchases your product/art directly from you at your wholesale price. They then mark it up to your suggested retail and have full control over discounts and any future decisions to raise the price. The biggest benefit to this, is that you get paid right away. On the flip side, when you enter into a consignment agreement with a vendor, they take your items and pay you when your item sells. There’s less risk for them and you have to wait to get paid. The benefit to this sort of arrangement is that the percentage the vendors keep is generally a little less. Most of my consignment vendors keep 25-40% of the sale, versus 50% for the average wholesale account.
This is a very simple formula to get you started thinking about pricing your work. As you can see, there are hundreds of factors that can affect your bottom line and how you calculate your wholesale price. Maybe you have foundry costs if you are casting a sculpture in bronze. Or printing costs if you produce giclée prints or photographs. Or maybe you’re a wildlife sculptor who takes safari trips to get actual pictures of the animals you will be creating and need to consider those expenses. There are dozens of ways to customize this formula to more accurately reflect the value of your art. Hopefully, this article is a good place for you to start reflecting on what you need.