After calculating what you are going to charge, use the prices to create a pricing structure:
- Selling price to the public - recommended retail price
- Wholesale price/trade price
- Sale or return price
- Selling direct to the public
The selling price for the public should be the trade/wholesale price times two, plus tax. This means that the wholesale price is your bottom/lowest price that will give you a profit.
You should set your prices to realistically cover your costs, including time spent at an event, and know what you need to charge to make a profit. You charge double your wholesale price to cover your own costs of sales, such as packaging, stand hire, etc.
Do not undercut your other outlets, otherwise they will no longer want to sell your work.
Use selling to the public as an opportunity to test the market by exploring new products and new prices.
Selling to trade
The prices you offer to trade, i.e., your wholesale prices should cover your costs and provide some profit.
Galleries and shops have enormous overheads, which is why they put so much of a mark up on pieces, but remember they will be selling your work all of the time, so you can produce the work without interruption.
Before approaching wholesale or trade outlets you need to decide on:
- Minimum order quantities.
- Discount prices, and quantities to qualify.
- How much of your work they will need to make a good display (it is in both of your interests to display your work as well as possible).
- Consider charges for carriage or if you want to offer carriage free.
- Agree what the payment terms are – pro forma, payment on delivery or credit. If offering credit, ask for trade references.
Sale or Return
If you provide work on consignment (sale or return), make sure you know exactly what the terms are. Keep a close eye on the pieces, as there are risks that may or may not be covered by the seller
You do not want your work out for too long, so if it is not selling after 6 months it is time to move it. That means keeping records of where your work is and when it was placed.
Review your prices annually.
More information is available from craftscotland.