When I was first starting out, I did a show in Houston. Another sculptor visited my booth and gave me a great compliment. Then he said, “You need to double your prices.” I was stunned. The prices were already higher than made me comfortable and I couldn’t fathom why he insisted, so he explained it to me. For that, I am forever grateful. Here’s what he said (keep in mind that we are talking about bronze and steel sculptures. You will need to do some research for your specific media).
“At your prices, the middle class can’t afford you. Even if you dropped your prices, they’re out of range. At the same time, those who can afford you won’t buy your work because you haven’t demonstrated its value. Collectors are making an investment and want to be sure they are getting the best they can for the money they spend. By under pricing, you send a message that you don’t value you’re own work, so why should they?”
This made sense and I did what he suggested at the next show. I went from an average price of $900 to an average price of $1800. Not only did I double my prices, I doubled my sales. In addition, instead of paying with credit cards, the buyers paid with cash and checks. Eventually, I found my sweet spot. Now, I raise my prices 10% if I have sold more than 50% of my inventory at the end of the year. I almost always do, which tells me I’m priced appropriately.
Here are some tips for right pricing your work.
1. Know how much it costs to make your work including materials, promotion, contest or booth fees, electricity, phone, internet, studio space, credit card processing, accounting, commissions, etc. Also know how much you need to make. Do your math first so you understand your bottom line. For more on this, check out an earlier post on my other blog site.
2. Find out what the mid range is in your media. You almost never want to be the lowest or highest. Lowest suggests poor quality, desperation, or lack of knowledge. Highest suggests arrogance, is often unattainable, or both. In the mid range, you are competitive.
3. Figure out a formula that keeps your pricing consistent (and ALWAYS keep your prices consistent, regardless of where you are showing. My formula is height x width x $. This formula differs for each of my styles. Wall sculptures are $3.25 per square inch while standing works are $4.25. Obviously, this can produce some funky numbers so round to the nearest whole. Once you’ve established a square inch formula, you know what to charge for commissions and you don’t have to think about prices until it is time to raise them. The formula means that your profit margin relative to your time will fluctuate slightly, but this is to be expected. Sometimes we struggle to get a piece right. Other times, we don’t. It all averages out over time.
4. You can go up, but you can’t go down. Unlike other commodities, the value of art is supposed to increase. This is often a myth, but it is how the market operates. Consequently, you have to start at a reasonable point and increase slowly. I know many, many artists who did well prior to the recession at artificially inflated prices who are now struggling to pay the bills. Those who controlled their pricing and stayed attainable are making it through.
5. Just because you think your work is worth more, doesn’t mean it is. Check your ego at the door. My collectors consistently thank me for being reasonable. My response has always been, “I need to make a decent living, not a killing.” As a result, I always have.
6. If you got stuck with inflated prices and your sales have dropped dramatically, consider introducing a new body of work. That work can be priced lower because it is an unknown. Previous collectors appreciate the opportunity to support you in new creative endeavors and the new body can attract new buyers.
7. Offer varying sizes so buyers have price choices. When you do a show, having all your work sized the same is a distinct disadvantage. I try to always have a good mix — one or two really big ones, three or four small ones, and the rest in the middle. Most often, collectors will choose the middle range, but if you don’t give them a choice, you make it that much harder for them to make a decision. No one wants to look cheap and few will be able to spend top dollar. In addition, people live in different sized houses and what fits in one won’t in another.
8. Discounts are part of the business, but don’t devalue yourself. Negotiating a price is something we all do from time to time and isn’t necessarily bad. I try not to discount unless the buyer is purchasing more than one piece, but I also am vested in closing the sale. When necessary, I might offer free shipping, delivery, or installation, or absorb the sales tax. Regardless, it is very rare for me to discount beyond 10%. Interior designers will usually ask for 20%, but I don’t always give it. If the designer is offering a long term relationship, then fine. If the sale is a one up, I typically don’t go there. Be sure to include possible discounts in your formula pricing so you don’t get burned on a deal.
9. The price is important, but usually not a deal breaker for serious buyers and you want serious buyers. They will become fans and promote your work to others. Those showing up at the end of the day on the last day of the show are vultures. They might pressure a hungry artist and get a piece they love, but they probably won’t remember the artist’s name. Think about it. If you are in the market to buy an ebook, the difference between $2.99 and $3.99 isn’t enough to stop you from purchasing the book you really want. This is true at higher prices as well. If a client can afford to spend $1000, she is can also afford $1200. It isn’t going to make a huge difference to her, but it will for you. I’ve always told my clients that my prices are fair so asking for a discount is unreasonable. Usually, they agree. The best collectors never ask. Treat them like gold because they are.
Selling art isn’t that different from selling anything else. Buyers want quality, value, and service for a fair price. When you can provide that, and your work meets their needs, your odds are greatly improved.
What are your thoughts? What pricing strategies have worked for you? Please share your thoughts and comments below and don’t forget to follow the blog so you don’t miss future posts in this series.