So, how do you determine your pricing?
Pricing is one of the major challenges for creative entrepreneurs. Almost all of them are seriously under-charging their clients. Many people "comparison-price" when they determine what they will charge. That means they go online or find other ways to see what their competitors are charging, then charge about the same or less. The only problem is that their competitors probably did the same thing. So no one has looked at what it really costs to do the work.
Slight price reductions often create a pricing war to the bottom.
We often think we don't have as much experience as the people to whom we are comparing ourselves. We charge slightly less than they do, thinking we don't deserve as much because we don't have the resume or education they do. We are almost always our harshest critic. Unfortunately, this slight price reduction often creates a pricing war to the bottom. Each new person entering the field charges a little less. That often means the experienced people in the field then have to justify why their pricing is so much more. If they are not clear about their value, they will often give in and come down in their price.
In a way, we are training our customers to ask for a deal. Part of our job as business owners is to teach our clients why what we do is worth what we charge, to educate them about the creative process and the details of our particular field so they see the importance of what we do.
Many artists simply guess at what they should charge.
I put the attached worksheet together because I found many of my clients were simply guessing at what they should charge. They were often asking too little for their work.The attached formula will help you find the minimum your work should sell for. Your experience and expertise will often allow you to ask for higher prices. If, after you come up with the minimum price for a piece, you think you can get more ...by all means charge more for it!
Sheryl Kosovski is a Financial Counselor and an expert in business development for Creatives. She has managed several art related businesses over the past 30 years, including two of her own. She has a B.A. in fine art and design from the Ontario College of Art in Toronto, Cananda.
Kosovski is a recognized speaker and workshop leader and has presented at numerous art schools and art leagues throughout the country including the School of the Art Institute of Chicago, Columbia College, Indiana University and St. Mary’s College. Her artwork has been shown throughout the Midwest in various galleries and museums.