Pricing Questions

I have been asked by customers, friends and competitors how I determine prices for the items I sell.  Sometimes customers ask for a discount if they buy multiple items and they are often confused by my answer.  With these things in mind I thought I would try to explain my pricing structure. . .

The first item in determining the price is the cost for the fabric.  If I get the fabric on sale, I can pass that savings on to my customers.  However, it is also true that if a customer selects a high price fabric, I must pass that on to them as well.

The other item necessary to determine the item’s price is my time.  There are a few items I make that don’t require a lot of time and I can offer these at a very low price to my customers.  Examples of these are culottes and long bloomers.  Then there are things that take several days to create like the pioneer outfits.

I try to use my timer to determine the amount of time I actually spend working on an outfit.  I set my timer for 15 minutes and every time it beeps I record what I was working on.  When a project is completed I add up all the 15 minutes to come up with the total amount of time it took to create.   I multiply the number of hours it takes to create an item by $10 to figure the desired labor charge. 

I add the cost of fabric plus the desired labor charge to determine the cost of the item.  My goal is $10 per hour but sometimes the market will not bear that and I must take a cut in pay.  Pioneer outfits are a good example of this-it takes about 10 hours to create this outfit plus the cost of fabric $15-$25.  These outfit sell for $50.  That makes the amount per hour I make $2.50-$3.50.  Now most people would not want a job that paid that low but I love my job!

Customers requesting a discount for multiple purchases do not understand that I must pay the same for fabric whether they buy 1 or 3 items and it takes me just about the same amount of time to create each additional item.  I do not have much savings on multiple item sales, therefore, I can’t pass much on to my customers.

Prices for everything seem to be going through the roof and profits are soaring for oil companies, farmers, grocers and everyone in between.  However, I try very hard not to increase my costs and to pass all savings on to my customers.  Hope this helps to explain how custom made creations are priced at Patti’s Originals.

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