[Jewelry making - Article 00561] - Re: [Orchid] Pricing wire wrapped jewelry

[Jewelryartschool]

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>    Trying to remember my class in pricing... boils down to:

>    a (Material cost per gram)
>    b (Number of grams)
>    y (Hourly rate)
>    z (Number of hours--fraction if under 1 hour)

>    (a * b) + (y * z) = actual cost

    I'm NOT picking on you here, but it's not quite that simple, and I
    hope the instructor did not really make it seem so. 

    What this class left out: 

    Shipping costs to you, insurance, the time it takes to put it on
    your inventory, time on the phone, time searching catalogs, time
    searching the Internet, time/fuel/ins. for running down parts in your
    vehicle, travel costs to get to shows, finance costs of your credit
    card, bank account & checking account fees, advertising, website,
    inventory tax, the costs of collecting sales taxes, general office
    costs equipment, repairs, paper, ink, outside printing, postage,
    rent, phone bill, Internet service, gas, electric & water. Your shop
    costs tumbling compound, buffing compounds, buffs, light bulbs, new
    tools, continuing education, magazine subscriptions, and your
    monthly/yearly Orchid donations... 

    You add all of these costs up for the year, divide it by the hours
    you actually work, add your hourly rate, and then your materials -
    now you have a break-even price. THEN add in your profit. Now you
    have a wholesale price! 

    Further markups happen when the gallery or retail store becomes
    involved. They have to make money too...

    Someone wanna pick up/chime in here? I know I missed about 40 or 50
    other hidden costs that should be added into the cost of producing
    and selling a piece of simple jewelry - IF you want to break even -
    much less make a profit!

    I'd venture to guess that the high failure rates in turning a
    home/hobby venture into a real business are founded in the failure to
    take ALL costs into account when pricing the product.

Brian P. Marshall
Stockton Jewelry Arts School
Stockton, CA USA
209-477-0550
instructor AT jewelryartschool.com

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