Money Pot from Stands for Stars.
Last week I talked about why you shouldn’t rely on a formula to price your art. If you missed the post, you can catch up here: Pricing for Artists Part 1.
But you can’t take math out of the equation completely. You’re running a business and the fact is that you have to make money. (Side note – if that doesn’t matter to you, then stop reading my blog! Just enjoy the process of creating and stop worrying about running a business. What you’re doing is a hobby. And that’s okay. It doesn’t always have to be a business. Make it what *you* want it to be.)
So here’s the nitty gritty. I’m going to teach you my favorite strategy for pricing art of any type. Ready?
First, you need to figure out your Base Price.
Base Price = cost of materials + cost of overhead + reasonable hourly wage
(I’ll note here that cost of overhead can be a little complicated. The easiest way to do it is to figure out how much you spend overall each month on energy, gas for your car, water if that’s part of your medium, and anything else like that. We’ll call that A. Then count the average number of products you make per month. We’ll call that B.
Overhead = A/B
Yep, it’s that simple. Just have the same amount of overhead for each product and call it a day. The differences in time you spent on each product and all that will work themselves out later.)
Your Base Price is actually the lowest possible price for your product. It’s your break-even number. If you price any lower, you’re losing money. “But Laura, I don’t lose money by not adding in the hourly wage.” Ah, but you do. You are running a business (I say this a lot) and that means you get paid. Just as if you were an employee, you have to take a wage when you’re a solopreneur too.
So what do you do with the Base Price? Well, you sit with it. This is where things get a little touchy-feely. You need to get really quiet with yourself. Write down your Base Price on a piece of paper. Double it and then write that number down. We’ll call it Number 2. Got it?
Think about your target market and Number 2. How does it feel? Do you feel like your stealing from them? Do you feel like you’re worth more?
Let that resonate for a while.
Then I want you to say the Base Price out loud (yep, to the empty room) and and move up in increments from there. For instance $50, then $60. Let each price give you a positive or negative feeling. Keep moving up until the “I’m worth more than that” feeling goes away and the prices feel positive. Then keep moving up until you hit a negative, “that’s unreasonable” price. You’ve gone too far. The last positive price is perfect so we’ll call it the Perfect Price.
I’ll also note here that this works really well in a group of peers (that means other business owners or artists, not your best friend or your mom). You say each number out loud to everyone and they affirm your positive or negative feelings on the price. It gets a little woo-woo, be forewarned. But if you’re not afraid of auras and collective energy, then it really helps you break through your own monetary issues, which are almost certainly messing with your ability to properly price your work.
This Perfect Price will both give you a profit and give you the confidence to tell people out loud how much it will cost to buy the piece. This Perfect Price will feel so warm and fuzzy that you’re no longer ashamed to tell people what your art costs. And this Perfect Price will allow you to find the unique customers that will fall in love with your work *and* pay for it instead of lowering your price to fit the wrong customer.
How do you currently price your work? What do you think of Resonate Pricing? How did you feel when you came up with your first Perfect Price? Let me know in the comments. Your thoughts might even get featured on a blog post or in the newsletter!