IN THE SPIRIT OF GIVING (please read)
I have recently reduced my prices to reflect ONLY THE COST of MATERIALS & SUPPLIES (wood, glue, screws, sandpaper, stain and clear coat, etc.) and OVERHEAD (rent, electric, insurance etc.) required to produce each item. After I explain how I arrive at my prices, I will explain my reasoning and the inspiration for this change.
For the MATERIALS I calculate the cost of the amount wood involved and add a 75% markup. I am confident that by doing this I sufficiently cover the cost of the materials and supplies other than wood. In addition, for items such as lamps that require electrical components, or cabinets that require hinges and knobs, or other items that incorporate special hardware, the cost of that hardware is added.
For the OVERHEAD I total all of my monthly costs and and divide by 160 hours (the equivalent of four 40 hour work weeks per month) and add a 25% markup, thereby covering incidentals such as tooling, maintenance and cleanup. Fortunately, my monthly costs are currently very low and my overhead comes to only $5.60/hour.
Examples of how this has affected my prices are a)my business card holders, which have seen a decrease from $38.00 to $24.00, and b) my cherry spice cabinet, which dropped
from $1275.00 to $710.00.
I decided to do this, and to be as transparent about it as possible, for several reasons. First and foremost, I love creating things out of wood, and I want to be able to keep doing so. It is very impractical, however, for me to continue producing things if I can't find homes for them. I would eventually go broke buying materials and paying rent, while sitting on an inventory of unused items. And as much would love to just make things and give them all away, I can't afford to do that either; I would go broke just as quickly. Either way, I would have to give up the craft.
What I CAN afford to do, though, is to GIVE MY TIME, and recover my costs so that I can pay my shop rent and buy more materials to CONTINUE DOING WHAT I LOVE.
Another reason for my decision is that I have realized that the items I make have no actual value if they just sit, looking nice in a shop display or collecting dust in storage. Their value is only realized when the items are put to use. And I WANT MY WORK TO HAVE VALUE.
Additionally, I want people to afford nice items that are designed and crafted to be useful for generations to come. I want people to afford nice gifts for friends and family when they might not otherwise. These items are overflowing with good vibes and I want people who own my items to know that I thoroughly enjoy the process of creating them, and that I hope they get at least a fraction of that joy from their use.
My inspiration for this change comes from the writings
of Charles Eisenstein; most specifically from
chapter 21 of his book 'Sacred Economics'.
(free to read on his website www.charleseisenstein.org)
WE ARE NOW A PART OF THE GIFT ECONOMY
Please Pay It Forward
James Watt
Distinctions Furniture & Accessories
