As most of you lovely regular readers of my blog know, I’m fairly new to the crochet game. Despite my clear addiction to crochet which would indicate that I’ve been crocheting forever ( I have loads of stock now) I’ve only really just started on my crochet journey at CROCHET BRIGHT AND BEAUTIFUL
I may be new to crochet , but I’m not new to business. I’ve been running my children’s entertainment service business Diane’s Puppets now for 20 years and I’m still in business, right in the middle of a double dip recession , despite my job being a dispensable luxury service ( I’m not strictly essential really am I? ) which should indicate that I’ve got some sort of a business brain in my skull. ( As well as being rather silly, don’t ask, it’s a skill!)
So where is this all leading, you may ask?
Well…keep the business thing in your head and let me tell you a story.
I made this bag the other day:
I think she’s a beauty. She’s made of 33 individual squares ( no two squares alike ) in very bright colours, with gold yarn detailing , fully lined in black cotton with pockets, button fastened, nice long strong matching striped shoulder strap and finished off with a pretty large red crochet rose.
This bag came about as a bit of an afterthought. She started life off as a scarf commission. ( Well I say commission, no money was ever decided on as I didn’t want to commit to such a large piece without giving the pricing structure really good thought. ) Actually, let me explain this properly.
I meet lots of wonderful people when I occasionally work my market stall.
I get many admirers. It is certainly a massive ego boost to have strangers stop and admire your work. This one time was no exception. I had a young lady stop and ask me about my granny square cushions and she explained that the latest trend on the high fashion catwalks across the globe was bright crochet colours in crochet granny squares edged in black. She pointed out the very bright colours in my granny square cushions and asked if I could make a scarf for her in the up to the minute fashion trend of black and bright. I said that was certainly possible. She then went on to explain that she would like a scarf approximately 2 1/2 ft (70cms) wide and REALLY long as in when she wrapped it around her neck, she wanted it down to her mid calf. In my head I was thinking , my goodness, that’s not a scarf, that’s a blanket!
Now I had my cushions on sale at the time which this lady was clearly carefully checking outThis one , for instance was clearly marked at £20. It is made of 9 squares plus a large square at the back. It takes around 2 days to complete. I have a pricing structure for granny squares that goes like this: £1 per square plus 10% for joining and finishing. That would make 2×9 squares plus £2 = £20.When I compare it with similar cushions on handmakers sites like Folksy and Etsy the price compares favourably, indicating I’m doing something right.
So I had made a mental calculation that this gargantuan scarf that this lady had excitedly requested would cost a pretty penny to create. She did keep pressing me for a quote on the spot , but knowing I needed time to work this out before committing to a price I gave her my card and asked her to call me back.She kept reassuring me that ‘Don’t worry, I’ll pay” . I thought to myself, well she’s seen the price of the cushions…
Well, it worked out that the scarf would take around 85 squares to complete… and would cost around £90. Ouch!
And so my bag was born.
Using my formula, I worked out the cost to charge on the large bag. It would retail at £65 which although wasn’t cheap, I think it represents the amount of work that went into this original bag. It took at least two weeks solid work to make this. This was not a massed produced item, but a handcrafted one-off; the person who likes this bag would be liking something totally unique.
I took photos and popped it onto Pinterest. How I love Pinterest! For a visual person like myself, there is nothing more contagious than collecting images and being able to organise them into ‘taste boards.’ I’ve found it indispensable as well to gauge public taste and the marketplace. If you haven’t jumped on the Pinterest train yet, hurry!
Well this bag proved to be very popular and got lots of likes and ‘repins’ ( when someone copies your pin and puts it in their own collection of desired images) in a very short space of time. I noticed that someone had commented on the bag after liking and repinning it saying:
They’re selling these for £65!! I could make the same for under £20 and still make a profit!
That stung initially. But then I started to think, well if she liked it, if she could do the same for less, why didn’t /hasn’t she? I replied :
Sure? Depends if you are charging for your time… This is a large tote bag .
And I got this answer:
Rough estimate of cost, without seeing the exact size. But, pretty sure. All depends on how much you consider your time is worth, I guess
This made me think about the whole hand making and pricing situation and how it is inherently connected with your feelings of self worth. Maybe a decade ago when I wasn’t in a good , solid place emotionally, I may have been tempted to lower my prices in an attempt to placate the lady but now, I wasn’t going to do any such thing. I responded:
To be fair to me, a bag this size would cost at least £20 in Primark and I’m certainly worth more than sweat shop rates…
That seemed to kill the argument/debate/ commentary stone dead.
Now this morning I received an email from two wonderful ladies who started me on my blogging journey in the first place, who run Ace Inspire , a company that encourage small business. I’m going to replicate the entire email because it is so relevant my story.
My personal theme right now is ‘honouring your time and worth’. It’s really forced me to think about the work I do, what I charge, my own self worth and how that affects my pricing.
One of the main human fears is rejection: in fact I heard once that it was the number one fear. Being rejected by our fellow human beings can be one of the most hurtful things that can happen. It comes from our ancient background, our need to be an accepted part of the ‘tribe’.
To avoid rejection many people choose to go ‘under the radar’. They never step up and do the thing that they were meant to do because they’re too frightened they might be rejected.
To grow a business, even to start a business you need to face your fears around being rejected.
You see, when you’re in business, you don’t want to supply everyone, especially if you have a service business. Your marketing and pricing is your tool box to help you encourage people to reject you! What’s that? We actively want people to reject us? Well yes, we can’t possibly serve everyone, and we don’t want to have to spend every day assessing each potential client one by one to establish who is the right fit for us. This is the purpose of marketing, and pricing is the equivalent of the hammer in your toolbox.
Negative rejection based pricing
What is it? It’s when you price your services very low as you fear rejection. You don’t want to hear the word ‘no’. You’re frightened that some people can’t afford what you’re offering and that makes you feel uncomfortable. Your own self worth might be low and you’re using your business and pricing to bolster that – you need to hear ‘yes’ to build your confidence and self-esteem.
Positive rejection based pricing
What is it? It’s when you realise that you can’t serve everyone in the world and that there is an ideal client for you and to reach that ideal client you have to use your toolbox. Pricing is your hammer, and you have to use it to get rid of everyone that isn’t the right fit. You need to actively seek rejection and realise that it’s a positive thing.
The ‘right’ price is the price where YOU are fairly remunerated and where your CLIENT feels they’re getting VALUE. Your job is twofold;
• Work out at what price attracts those clients that find the appropriate value in what you do.
• What do you need to offer to achieve the VALUE at the price you’re charging.
Once you’ve done this you have the perfect pricing strategy for you AND your clients.
If you enjoyed this article, it is just a taster of the sort of thing you’ll be getting in the new ACEInspire course for Summer 2012. Watch out for the email on 8th May that will tell you all about it.
I read this and smiled. Thank you validating angels. I knew I was right but it was great to have that reassuring pat on the shoulder. After all, I do sell my work even though some people do think that it is expensive. Well, hand crafting does appear expensive when you put it next to mass produced sweat shop produced goods.
Please check out Antonia and Erica’s sites. They are really clever ladies!
To end this rather long post, I have to leave you with this :
These monkey shoes were purchased by a very lovely fella I met at Brixton Makers market. He didn’t appear to be terribly well off, in fact at first glance he appeared to be a street drinker. ( maybe it was the can of beer in his hand). He fell in love with these shoes and asked me to put them aside for his grandson while he went to the cash point to get money. I duly did, despite thinking he may not be returning.
But he did, and he paid the full price of £9. When I remarked that some people had said my stuff was pricey, he shook his head and said of course they aren’t. Just look at the work that went into these! What do people expect to pay?
Thank you Mr Monkey shoes angel. I hope your grandson gets many happy days of wearing the magic monkey shoes.
If you’re a facebook person, please like my page on Facebook . Ta!
I’ve had such incredible response to this post, thanks everyone! By far the most interesting response was a lovely lady below who linked me to this post, I just have to share it with you. It really does put everything I said into sharp relief.
Please PLEASE check it out. It was an OMG moment for me.
- Busy Making, Selling and Growing the Brand (dianespuppetsproducts.wordpress.com)