I'm a newbie and looking for all guidance I can get on how to price my jewelry. I subscribe to Rena Klingerberg's free home jewelry business success newsletter. If you don't, I recommend that you do. There's great stuff there, and Rena is a well known and successful jewelry artist. In the last newsletter, Rena shared her pricing formula, which I want to share with you. It is designed to compensate the jewelry maker for supplies, overhead, and time, and provide a margin so that if you choose to sell at wholesale (e.g., to a gallery or on consignment), you still make a profit. If any experienced team members have other ideas, please share them. I'm hungry to learn.
I don't know if this formula works for all media, but I would think that it does. Rena's formula is:
1. calculate base price (cost of jewelry supplies + packaging material)
2. figure out your pro rated labor cost based on an hourly rate you set for your work (e.g., a necklace that takes 30 minutes to make at $20 an hour has a labor cost of $10).
3. total the above and add 10% for overhead (jewelry business website fees, jewelry displays, tools, insurance, merchant account fees for accepting credit cards, receipt books, digital camera (and its batteries) for photographing your work, jewelry magazines, workshops, etc.). If you're in business, your jewelry has to pay for all of those expenses as well as your jewelry making supplies.
4. the price you end up with is the minimum price you can charge without losing money.
5. multiply by 4 to give a retail price. A wholesale price would be 40-50 percent of that, and you would still cover your time and costs.
Since I'm trying to establish a business, I'm going to try this formula. I would appreciate any thoughts and comments from the team.
Sherry
Gemstone Isle
