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pricing by ouija board

updated wed 10 dec 97


shelford on mon 8 dec 97

re: >Go ahead and use a ouija board to set your prices if you want...
Aw, rats, Michael - you guessed my secret. I've been reliably informed that
pots have auras and astral bodies. So, one price for the pot, but if you
want the astral body too, you're looking at BIG bucks. (After all, I don't
want to let my prototype go...)

Seriously, I know, from our off-the-list exchange, that you feel that the
times and costs I have entered are wildly unrealistic. Obviously I don't
think so - I've been working with this method for a few years now. But what
the heck - you may be right - time will show. But since you have reopened
the discussion on the list, I suggest that what we should be looking at here
is a process, one of several legitimate ways of figuring out how to put a
price on a pot. Surely anyone considering going into business for
themselves is not going to take someone else's spreadsheet and think they
can apply it directly to their own situation. Anyone planning to go into
business for himself, without thinking for himself, is doomed from the start.

But since you raise the point, I would maintain that it would be a very good
idea, before they quit that 9-5'er, that they go through the same exercise.
Looking at the market they are going to be serving, and what niche they want
to fill. If they haven't assessed their own costs, times, overheads, needed
wage, and overall expectation of lifestyle, and applied that to the kind of
pots they are proposing to sell, and checked whether, all added together,
the price will work - they're in trouble anyway. (I went to considerable
inconvenience to do most of my selling in this market for four years before
I moved here, so that I could get a comfortable sense of whether and how it
would work.)

re: >I know your household is not dependent on your income from pottery,
>and you pursue it primarily for the non-financial rewards you get from
>working in clay
>The reality is that very few full time potters earn what
>would be considered a "living wage" by the rest of society... most
>make up the difference by some combination of longer hours and frugal
>living. It can be a very meaningful way of life, but rarely are the
>financial rewards significant.
Given that reality - that most potter's households can't run on one potting
income alone - why would my experience be written off for that reason? It
is a necessary part of our continued survival here, and I have to be as
careful as anyone else to be sure, as I start up again, that my time in the
studio will continue to contribute adequately to that survival. If it does
not do so I will have to give it up. Again, I think the point to discuss is
the process, versus simply charging whatever you can get. The latter is
fine if what you can get is high. It breaks down if the going market rate
is low, and the potter hasn't got enough of a handle on his necessary costs
to know when he's passed the breaking point. And this is where one really
can't judge another's inputs, because everyone's costs will vary according
to their circumstances. (e.g. I don't need to worry about rent, but I do
have to consider ferry fares. I don't enjoy doing fairs, so I stay home and
make slightly lower-priced pots instead. etc.)

This has been an intriguing thread. There seem to be almost as many
approaches as there are potters. But that's what the list is for, right???

- Veronica

>We've discussed this a bit off the list, and I appreciate your viewpoint. I
>really have no problem with you determining your prices by any method you
>want. I know your household is not dependent on your income from pottery,
>and you pursue it primarily for the non-financial rewards you get from
>working in clay. Go ahead and use a ouija board to set your prices if you
>want, I celebrate your freedom to do so.
>It's only the appearance of systematically calculating your hourly earnings
>that concerns me when these figures are published on the list. For those
>who are in the position of considering "quitting their day jobs" and
>pursuing pottery as a full time occupation, this sort of accounting could
>lead them to serious financial difficulty. A person considering quitting a
>10 or 15 dollar an hour job with the expectation of replacing that income
>with what they can earn doing clay work will most likely be rudely awakened
>from that dream. The reality is that very few full time potters earn what
>would be considered a "living wage" by the rest of society. No doubt some
>do, thanks to their superior talents, training or circumstances, but most
>make up the difference by some combination of longer hours and frugal
>living. It can be a very meaningful way of life, but rarely are the
>financial rewards significant.
>Michael McDowell
>Whatcom County, WA USA
Veronica Shelford
s-mail: P.O. Box 6-15
Thetis Island, BC V0R 2Y0
Tel: (250) 246-1509

Michael McDowell on tue 9 dec 97


I agree with you that it serves us all well to air our different opinions
on the list. And you and I seem to have very different opinions as to how
to go about arriving at prices for our work. You seem to feel that you
should have a basis in cost accounting to validate your prices, yet you
don't seem to feel that it's fair or appropriate to calculate in the time
and expenses that are not directly related to the making of the pots when
you calculate your costs. This gives you what to my way of thinking is an
inflated estimate of the income and hourly rate that you are deriving from
your pottery activities.

Even in determining the direct time involved in producing pots, it seems to
me that your approach is misleading you. As you explained how you arrived
at your estimate of the time involved in making a =22simple bowl=22 it =
to me that you had timed the separate steps involved in the process with a
stopwatch. When you take that approach you get your =22sprint=22 rate, the
fastest rate at which you could possibly get the work done if you had no
need to pause for rest or reflection, and could timelessly move from one
step to the next without the need to clean up, move things around, or any
of the hundreds of other little tasks that mount up as necessary to
maintaining the flow of the work. I feel that one can only arrive at an
accurate measure of time per piece by looking at a much longer stretch of
time. Long enough that it includes all the cycles of the work of potting.
Of course by then there may be hundreds or thousands of pots of different
sizes =26 degrees of complexity that this time must be allocated to, and you
might use your sprint rates for the different pieces to determine what an
appropriate proportional allocation would be.

Personally I have never been big on this. Terrance Lazaroff has gone into
cost accounting in a series of postings to the list in such great detail
that I've not had the patience to actually study all his proceedures to say
that they are sound. But if you are seriously interested in such an
approach you might try searching the archives or contacting him. I've gone
far enough through the process to recognize that I am earning only a
pittance as an hourly rate.

Like you, I am not doing it for the money, but can only do it if there is
money enough to sustain the activity. So I choose to spend the precious
time I have to devote to clay doing other things than maintaining the kind
of careful records of inputs and outputs that would be necessary to
determine just exactly how poorly I'm rewarded in financial terms. I've
found other types of work that I can do on a part time basis that pay much
better, and so far I've been able to finance spending about half my working
hours during the course of a year on activities related to clay. Oh, I used
to be able to earn enough to do clay year round, but only because I was
willing then to take the kind of shortcuts on the quality and finish of my
work that allowed me to keep my prices low and the output high. It finally
dawned on me that doing anything less than the best work I was capable of
would spoil it's meaning for me.

This was a poor financial decision, but I think a brilliant spiritual one
to make. Once I
had committed to being the best potter I could be, not the most productive
or wealthiest, I found renewed enthusiasm for the work and have experienced
much more rapid development in the years that have followed. This is true
even though I have less time to spend with clay. For I've not been able to
raise my prices in proportion to the extra time I now spend on each piece.
Every improvement in my work has seemed to come at the loss of some income.
Partly, this is due to the fact that I'm kind of lazy about marketing. It's
the part of being a potter that I like least, and the higher the prices one
sets on ones work, the more time and effort is required to get them sold.

You say that you think charging as much as you can possibly get is not
appropriate for most potters, but I'm not sure that you understand what I
mean by that. I'm not talking about setting the highest price that anyone
will pay. There's no sense in setting your prices any higher than will
allow you to sell all you can or want to make. When sales drop off, you
know you've pushed a little too far. I rarely lower my prices on anything
though, just cut back on the numbers I make of any item that seems to have
gotten too pricey. In time inflation will bring the price back into line,
or I'll have found something else I can make that is better recieved by the

While it may be tedious and depressing to determine accurate figures for
true cost accounting, your methods are perfectly adequate for determining
approximate relative costs. Using your approach in that way, you could fill
in whatever price you are getting in your speadsheet, and make your hourly
return figure the =22unknown=22 in the equation. Recognizing that it is not =
true measure of what you are making per hour as a potter, you could still
use the information to evaluate which of the things you make are rewarding
you at the highest rate. This way your spreadsheet could guide you to see
which things you want to either raise prices on or discontinue making, and
which are the most lucrative uses of your time. Then don't add new items
unless they can at least improve the average rate.

But really Veronica, that hourly rate is a gross exaggeration, I would
never use such an analysis as a reason not to charge more. You should worry
more about cheating yourself and less about gouging your customers and
friends. They always have the option of simply not buying things that they
feel are overpriced.
In some ways we can cheat everyone if we don't charge enough for our pots.
If your work has substance and depth, but you sell it cheaply, it ends up
going mostly to people who only see the surface. Like the tree falling in
the forest with no one to see or hear it, that substance =26 depth can be
lost if it's not perceived.

Well, If I wasn't rambling to begin with, I certainly am by now...

Michael McDowell
Whatcom County, WA USA