Another added thought. I think we hav gotten so used to the way large tech companies run their businesses. At a loss for decades to gain market share and focus on extreme growth. That we have started to expect the same from every type of business including makers. But we need to operate differently. We make a physical product, not purely a service or software (which typically have much higher profit margins). Being realistic about what you can do within your business model is key to taking advantage of what it can do best. Don't try to outcompete the big guys, lean into what they aren't doing or can't do because they inherently have a layer of bureaucracy in their decision making process. Often for small makers that means excelling at customer service and quality. You're customers will love you for excellent customer service and become a repeat customer with the help of high quality goods.
So true. It's all about positioning. What is your meaningful point of difference in the marketplace? Who are you and why should the consumer care? You're also right on pricing and the danger of discounts (military discounts are a bit different). Instead of increasing value by reducing your price (assuming you're priced appropriately in the marketplace), consider increasing cost/benefit for the consumer in some other way. Offer a matching keychain to a tote promotion...add an airtag holder to a bag...or include a small item to help the customer care for the product after purchase.
Years ago I had a friend remind me that it is easier to reduce/have a sale, etc... than it is to suddenly raise your prices. Price it right (as close as you can get) the first time.
The biggest problem I have is that I hand sew things - which obviously takes a lot longer. So by including labor hours for that sometimes make the item seem ridiculously expensive.
True, but some customers appreciate hand-stitched because its completely hand-made/saddle stitch is extremely durable/and supporting craft is important to them. It's also worth noting that there may not be a big market for every item for the amount of time it takes to make. Imagine paying for a completely hand-stitched leather couch as an example.
This was amazing. I'm a leatherworker, and this really helped me. I have struggled with my pricing. I'm going to take your advice and calculate everything going in to each product. Give myself a chance to grow. Thanks for this video. Keep uploading.
This is such important information! Too many do not consider enough factors when pricing - along with being apologetic about price and costs. Thanks for creating and sharing this information!
Thanks for sharing your wisdom. I loved watching you all work on those lovely bags and your fantastic shop. I’m retired and just getting into the leather crafting business. Love watching you work it. Blessings.
Important note: how you decide to sell will have a big impact on pricing models. Whether direct to consumer, business to business, retail, wholesale or a combination of these
Things of good or superior quality cost money. Then, the market decides. I ordered one of your bags for my wife. It's in line for production now. I can't wait to give it to her.
Absolutely loved this video. It’s extremely informative and inspiring. This is a great source of information and I hope you are able to turn this style into a series. I’d love to hear more advice you have to share as it becomes available. Thank you both for being so helpful and supportive to potential competition and hobbyists alike.
Begginer like me always worry competing cheap walmart wallets.., Thanks making me remember studied Cost Accounting in college... Sometimes, didn't calculate how much time we spend to learn Leathercraft and for doing practice to make it aesthetic.
it's easy to forget or not calculate certain costs because we think they are insignificant. But accounting for your time is super important it all adds up
Great information, thanks! A little off topic, but what edge roller are you using? I'm trying to find a really good one that doesn't lock up, causing me to drag the tool along the edge instead of it rolling properly.
This is a never ending battle! We have had some that lasted a long time (6+months) and some that have locked up after the first use. We've tried a bunch out there but end up getting ones off Etsy but the quality is inconsistent. I wish we had a better answer for you. One thing we do to keep them working for longer is a little silicon lubricant spray and give it a few good spins before painting. Cleaning them as soon as you're done painting. Our other advice is to keep any paint from getting into the ball bearings. You probably knew all this but hope that helps
Just finished a set of coasters. Didn't keep track of hours but it is a LOT. All hand carved flower tooled each one a different pattern, lined, hand stitched, dyed, antiqued, same with the matching leather stand. Turned out gorgeous if I may say so myself. Then thought who on earth would pay what they're worth for coasters. They are functional but really they're leather artwork so I'm gonna price them very high and find out.
It only takes one person to want to buy them! It's really easy to put handmade goods in the same category as mass produced, which is why it's important to compete where big companies can't, like your hand tooled coasters. best of luck to you!
Thanks for making this video, going threw the points. Its the first video of yours I've seen, well done. Pricing can be weird, I've charged $10 for setting one snap and $20 for one rivet because I got all the right stuff together to make clean awkward repairs. Your Master tool/Weaver edge trimming tool is awesome, do you have any thoughts on the strap cutting machines out there? Weaver and Tandy both have manual and motorized ones. I also just watched your shop tour video are any of your dies made by Bradshaw steel rule dies inc? I've thought of working with them. Do any of your cutting die sets include the slot and rivet etc holes? rather than punching them separately afterwards?
Thanks, The Easy Edger is pretty great and saves a lot of time to hand beveling. We get our straps cut for another time saver. We've been thinking about getting a custom color direct from the tannery which likely require us getting a strap cutter. We would probably get one that has a motor like the Cobra AK 20 and I think Weaver has a motorized one too. It really depends on the amount of straps you'll need, cost, and space you have to dedicate to the machine.
That's a great lesson to learn and like you said "never again". I think we've all been there. Getting excited for a big sale like that can definitely cloud our business judgement. There is nothing like securing a big order. That's why having set terms helps; so you can be reminded ok, these are the parameters my business can handle. We also often bend to customers that are not our ideal customer. Almost always, your target market will not be asking for a discount because they value what you bring to the table.
@@V3leathercraft everything is a trade off. if you're working with a shop, you're also paying for the exposure to their audience/customer, merchandising, and for them to sell your goods. Which could mean more volume but less margin. Depending on your product and how your business is setup this could be good or bad. Some small handmade items that are quick to make and high profit may benefit from this. Larger more time consuming pieces, likely not. I don't feel it has to be a struggle. You should be working together with a shop for the best outcome.
I think what you say about pricing your items low being a bad thing is a bad thing to follow. You shouldn't sell it for $20 if it costs $20 in materials, I'd say go for $30-35 if you're just starting. You're a new maker going into a very competitive market. If you sell your first production wallet for $60, people will see how low of a following you have, and go for someone else with a larger following since they'll trust them more. If you price it at $30-35 and it sells fast, then knock the price up a bit. When you get a good amount of people ordering, you can start raising your prices to what you're worth. Yeah, I'm sure all you popular people were able to give your items a high price and sell them when you first started. The market was much less competitive when you started. People would look and see a few makers, but now they look and see a bunch of popular ones with high prices and a bunch of unpopular ones with high prices. Who do you think they'll buy from? Don't start selling your products with the intention to earn enough money to live off of selling leather goods. Start selling them to make some profit, and if you start earning enough, then you can quit your current job if you feel like it.
We totally agree. Not everyone is going to sell their goods with the intention of making it a business. There are plenty of people out there that are just looking to keep busy and make items for fun. I think creative people that want to make money will sometimes short change themselves when pricing. Having a product that is different in the market is the starting point. If you are trying to compete with mass produced goods in quality and price, you are likely setting yourself up to fail. There are a lot of strategies, like you mentioned. Pricing yourself lower to start and getting your name out there can be a winning formula for a time. But if you aren't at least breaking even you'll find yourself in trouble in the long run. Like your last paragraph mentioned the market will let you know. If you aren't selling enough, either your product isn't different, high enough quality, or you haven't truly found your audience. Much easier said than done. Thanks for your response!
@@hemlockandhyde I am gifting a bag from my inventory, how do you track the gifted item for accounting purposes? does it count as a deduction? or is this practice not recommended? I also donate my bags to different charities but I am not sure how to deduct them. Thank you so much for the help.
got it, it's my understanding that typically donations can qualify as tax deductible for a 501 c 3 non-profit. You should also receive a receipt from the Non-profit/proof of donation. I believe there are limits based on your adjusted gross income. For bookeeping you can create an invoice for the product and add it as an expense, and remove it from inventory if you track. It's likely best to consult your CPA for your specific situation.
This is true. If you're making stuff just for fun than you likely won't need to figure out all the details. Just focus on making what you love and improving your skillset.
I keep telling my one leather student that if leather items sell the moment you list it you have the item priced to low. Great vide on a scary tropic.
I run an eBay shop and you are totally right.
Sometimes I list something that goes straight away and think "damn".
Another added thought. I think we hav gotten so used to the way large tech companies run their businesses. At a loss for decades to gain market share and focus on extreme growth. That we have started to expect the same from every type of business including makers. But we need to operate differently. We make a physical product, not purely a service or software (which typically have much higher profit margins). Being realistic about what you can do within your business model is key to taking advantage of what it can do best. Don't try to outcompete the big guys, lean into what they aren't doing or can't do because they inherently have a layer of bureaucracy in their decision making process. Often for small makers that means excelling at customer service and quality. You're customers will love you for excellent customer service and become a repeat customer with the help of high quality goods.
Very common with publicly traded companies. I look for these when buying stocks.
@@slick-px4pq agreed. but not every company will go public. The strategies to IPO are very different from small private companies as they should be.
So true. It's all about positioning. What is your meaningful point of difference in the marketplace? Who are you and why should the consumer care? You're also right on pricing and the danger of discounts (military discounts are a bit different). Instead of increasing value by reducing your price (assuming you're priced appropriately in the marketplace), consider increasing cost/benefit for the consumer in some other way. Offer a matching keychain to a tote promotion...add an airtag holder to a bag...or include a small item to help the customer care for the product after purchase.
Years ago I had a friend remind me that it is easier to reduce/have a sale, etc... than it is to suddenly raise your prices. Price it right (as close as you can get) the first time.
The biggest problem I have is that I hand sew things - which obviously takes a lot longer. So by including labor hours for that sometimes make the item seem ridiculously expensive.
True, but some customers appreciate hand-stitched because its completely hand-made/saddle stitch is extremely durable/and supporting craft is important to them. It's also worth noting that there may not be a big market for every item for the amount of time it takes to make. Imagine paying for a completely hand-stitched leather couch as an example.
This was amazing. I'm a leatherworker, and this really helped me. I have struggled with my pricing. I'm going to take your advice and calculate everything going in to each product. Give myself a chance to grow. Thanks for this video. Keep uploading.
Glad it was helpful! Thanks for giving it a listen/watch
This is such important information! Too many do not consider enough factors when pricing - along with being apologetic about price and costs. Thanks for creating and sharing this information!
We're happy to help!
Thanks for sharing your wisdom. I loved watching you all work on those lovely bags and your fantastic shop. I’m retired and just getting into the leather crafting business. Love watching you work it. Blessings.
Thank you so much for watching. Glad you enjoyed the video
Important note: how you decide to sell will have a big impact on pricing models. Whether direct to consumer, business to business, retail, wholesale or a combination of these
Things of good or superior quality cost money. Then, the market decides. I ordered one of your bags for my wife. It's in line for production now. I can't wait to give it to her.
Hi Nick.
I'm grateful for the advice shared in this video. It has been helpful to me.
Glad it was helpful!
That bag is amazing
thanks!
Absolutely loved this video. It’s extremely informative and inspiring. This is a great source of information and I hope you are able to turn this style into a series. I’d love to hear more advice you have to share as it becomes available. Thank you both for being so helpful and supportive to potential competition and hobbyists alike.
Thank you! We're all ears if you have topic for future videos. We want this to be as helpful as possible to our community👍
Begginer like me always worry competing cheap walmart wallets..,
Thanks making me remember studied Cost Accounting in college...
Sometimes, didn't calculate how much time we spend to learn Leathercraft and for doing practice to make it aesthetic.
it's easy to forget or not calculate certain costs because we think they are insignificant. But accounting for your time is super important it all adds up
Great information, thanks! A little off topic, but what edge roller are you using? I'm trying to find a really good one that doesn't lock up, causing me to drag the tool along the edge instead of it rolling properly.
This is a never ending battle! We have had some that lasted a long time (6+months) and some that have locked up after the first use. We've tried a bunch out there but end up getting ones off Etsy but the quality is inconsistent. I wish we had a better answer for you. One thing we do to keep them working for longer is a little silicon lubricant spray and give it a few good spins before painting. Cleaning them as soon as you're done painting. Our other advice is to keep any paint from getting into the ball bearings. You probably knew all this but hope that helps
Just finished a set of coasters. Didn't keep track of hours but it is a LOT. All hand carved flower tooled each one a different pattern, lined, hand stitched, dyed, antiqued, same with the matching leather stand. Turned out gorgeous if I may say so myself. Then thought who on earth would pay what they're worth for coasters. They are functional but really they're leather artwork so I'm gonna price them very high and find out.
It only takes one person to want to buy them! It's really easy to put handmade goods in the same category as mass produced, which is why it's important to compete where big companies can't, like your hand tooled coasters. best of luck to you!
Great subject matter team.
glad you liked it. It's so easy to get wrong, but once you get it right you can set yourself up for growth.
Thanks for making this video, going threw the points. Its the first video of yours I've seen, well done. Pricing can be weird, I've charged $10 for setting one snap and $20 for one rivet because I got all the right stuff together to make clean awkward repairs.
Your Master tool/Weaver edge trimming tool is awesome, do you have any thoughts on the strap cutting machines out there? Weaver and Tandy both have manual and motorized ones. I also just watched your shop tour video are any of your dies made by Bradshaw steel rule dies inc? I've thought of working with them. Do any of your cutting die sets include the slot and rivet etc holes? rather than punching them separately afterwards?
Thanks, The Easy Edger is pretty great and saves a lot of time to hand beveling. We get our straps cut for another time saver. We've been thinking about getting a custom color direct from the tannery which likely require us getting a strap cutter. We would probably get one that has a motor like the Cobra AK 20 and I think Weaver has a motorized one too. It really depends on the amount of straps you'll need, cost, and space you have to dedicate to the machine.
Made a mistake giving a 50-60% discount on bulk orders(over 200 pieces), never again.
That's a great lesson to learn and like you said "never again". I think we've all been there. Getting excited for a big sale like that can definitely cloud our business judgement. There is nothing like securing a big order. That's why having set terms helps; so you can be reminded ok, these are the parameters my business can handle. We also often bend to customers that are not our ideal customer. Almost always, your target market will not be asking for a discount because they value what you bring to the table.
Resellers won’t give full value on our efforts
@@V3leathercraft everything is a trade off. if you're working with a shop, you're also paying for the exposure to their audience/customer, merchandising, and for them to sell your goods. Which could mean more volume but less margin. Depending on your product and how your business is setup this could be good or bad. Some small handmade items that are quick to make and high profit may benefit from this. Larger more time consuming pieces, likely not. I don't feel it has to be a struggle. You should be working together with a shop for the best outcome.
Thanks a lot...again
You're most welcome!
I think what you say about pricing your items low being a bad thing is a bad thing to follow. You shouldn't sell it for $20 if it costs $20 in materials, I'd say go for $30-35 if you're just starting. You're a new maker going into a very competitive market. If you sell your first production wallet for $60, people will see how low of a following you have, and go for someone else with a larger following since they'll trust them more.
If you price it at $30-35 and it sells fast, then knock the price up a bit. When you get a good amount of people ordering, you can start raising your prices to what you're worth.
Yeah, I'm sure all you popular people were able to give your items a high price and sell them when you first started. The market was much less competitive when you started. People would look and see a few makers, but now they look and see a bunch of popular ones with high prices and a bunch of unpopular ones with high prices. Who do you think they'll buy from?
Don't start selling your products with the intention to earn enough money to live off of selling leather goods. Start selling them to make some profit, and if you start earning enough, then you can quit your current job if you feel like it.
We totally agree. Not everyone is going to sell their goods with the intention of making it a business. There are plenty of people out there that are just looking to keep busy and make items for fun. I think creative people that want to make money will sometimes short change themselves when pricing. Having a product that is different in the market is the starting point. If you are trying to compete with mass produced goods in quality and price, you are likely setting yourself up to fail. There are a lot of strategies, like you mentioned. Pricing yourself lower to start and getting your name out there can be a winning formula for a time. But if you aren't at least breaking even you'll find yourself in trouble in the long run. Like your last paragraph mentioned the market will let you know. If you aren't selling enough, either your product isn't different, high enough quality, or you haven't truly found your audience. Much easier said than done. Thanks for your response!
Do you ever gift your bags and how do you account for them?
i'm not sure I understand your question
@@hemlockandhyde I am gifting a bag from my inventory, how do you track the gifted item for accounting purposes? does it count as a deduction? or is this practice not recommended? I also donate my bags to different charities but I am not sure how to deduct them. Thank you so much for the help.
got it, it's my understanding that typically donations can qualify as tax deductible for a 501 c 3 non-profit. You should also receive a receipt from the Non-profit/proof of donation. I believe there are limits based on your adjusted gross income. For bookeeping you can create an invoice for the product and add it as an expense, and remove it from inventory if you track. It's likely best to consult your CPA for your specific situation.
When you turn your hobby into a business, then yes. Otherwise it is worth what it is worth to you.
This is only relevant to a business..a hobbyist or crafter don't need to figure all the overhead etc
This is true. If you're making stuff just for fun than you likely won't need to figure out all the details. Just focus on making what you love and improving your skillset.
ok cool so just a bunch of common sense got it thanks.
common sense not so common