Ceramic Design Group on sun 28 jan 01
pricing etc....of The Story of Peter the Potter. Yes its long......
This subject has been tossed around this list for many years. Here is a
different take on it.
Quite frankly, if consignment works for you, that's fine. If you sell
wholesale to a shop or gallery, that's fine too. I really don't care about
the percentage split between the gallery and the craftsperson/artist/potter.
Consignment is rather akin to having someone borrow money from you and not
pay interest. You are in essence, financing their business. If this sits
well with you, or if it is a way to get to the next step it works. Having
sold my work for many many years at wholesale trade shows, wholesale works
for me. And here is why it works, and I think this is what many of you are
missing. Consider the following story of Peter the Potter:
Peter the potter makes teapots. After looking around at the market and
seeing what teapots are selling for at Bob's Craft Shoppe and Emporium, he
figures that $100 is a decent retail price for his teapots, and after all,
its a copper red porcelain teapot with a wonderfully made over the top
handle. Whatever.
Bob at Bob's Craft Shoppe and Emporium has an open to buy from Peter the
Potter for $200.00 and Peter the potter agrees to sell him 4 teapots at $50
each, or $200 for the order. (BTW, this is called "keystone" in the
retail/wholesale trade.) So Peter the potter has a theoretical 2 large
burning a hole in hisr pocket. But before he goes out and puts a down
payment on the hottest new digital camera or buys a few pounds of cobalt
carbonate, he thinks its time to to figure out if indeed he made some money
on this transaction.
So Peter the potter puts pencil to paper and begins to calculate as follows:
1. Clay: porcelain, 6 pounds. He buys "clay in the box" and at the current
ton rate which he just purchased for $475/ton plus the extra $25 for
delivery, here's $500 for a ton, or $0.25/pound. Its a Tile 6 based
porcelain, not a Grolleg based porcelain. Cheap, huh?
2. Peter the potter unloads the ton of clay from the truck by hand, box
after box. Takes him about half and hour.
3. Peter the potter then decides to throw a batch of teapots. No pugmill. He
wedges up 12 6 pound balls of clay. He's quick, but his wrists bother him so
it takes him about 45 minutes, which includes making himself a latte and
listening to the latest NPR fundraiser, deciding he better send them some
money and not be cheap! At $0.25/pound, here is $1.50 in clay
4. So Peter the potter gets everything set up at his wheel. Bats, tools, hot
water to throw with. He throws the dozen teapots, takes a hunk of clay from
the box and throws 15 or so spouts, and 15 or so lids. By the time all of
this is done, he's got about 2 hours into the teapots. He unplugs the phone
so he is not disturbed.
5. After covering them, he needs to make glaze for these pots and some
others. He then downloads his Clayart mail and answers his phone messages.
6. The next day, Peter the potter trims, assembles, pulls the handles, and
after some quick drying with a hair dryer (a trick he picked up from reading
the Clayart archives (when he can access them)), he puts them all together
and covers them with plastic. This takes him 1.5 hours. He's good.
Time out. Lets add the total time for making the 12 teapots. I get 4 hours
and 45 minutes. Lets round that up to 5 hours. He did have to eat and attend
to some daily bathroom rituals. So 12 teapots in 5 hours, ready to bisque
fire after they have dried. 300 minutes divided by 12 is 25 minutes per
teapot. Not bad he says to himself. Back to work.
7. After they have dried, he cleans them with a scrubbie and loads them into
the bisque. He has a small Skutt with a computer, and has been bisque firing
for the last month so that he can fill his 24 cubic foot Bailey gas kiln.
Takes him a half hour to do this.
8. His glaze making took him about an hour, and in this hour, he made a 5
gallon bucket of a clear liner and a 5 gallon his killer copper red glaze.
He gets the buckets at the Donut shop when he goes to town.
9. He then blows off all the bisque dust and hot waxes the feet, the lids
and their corresponding galleys. And yes, Peter the potter reads Clayart and
has bought a really good respirator from Lab Safety in Janeway Wisconsin.
Takes him another half an hour. He's particularly efficient and has made a
really cool "Charles" (aka chuck) to hold the teapot upside down on his
wheel to wax the foot.
10. Takes him 2 hours to glaze, decorate, and clean the feet, lids, and
galleys. Peter the potter has a TV in his shop and got really absorbed in
the latest edition of "Who Wants to Be a Millionaire." Let's figure there is
$0.50 of glaze on each teapot
11. All the rest of the work needed to fill his gas kiln has already been
glazed, so he loads the kiln. Takes him 3 hours. He's thinking of one of the
Clayart posts he read about these new lightweight "Advancer" shelves he can
purchase when he gets in the hot seat across from Regis. He's still lifting
heavy SiC shelves. Anyway, he remembers to make an appointment with his
chiropractor. Starts the kiln and goes to bed.
Time out. Peter the potter now has an additional 7 hours. But he also
stacked his kiln with lots of other glazed ware. In fact, he's able to load
150 pieces of assorted size and shape into his kiln. So a simple division
works here. 420 minutes to load 150 pieces. That averages 2.8 minutes, but
lets round it to 3 minutes so he can have some extra time to make his cone
packs. So if we do the addition correctly, 25 minutes to make the teapots
and then an additional 3 minutes per teapot is 28 minutes. I'll be quite
generous and round that up to 30 minutes. After all, there are somethings
not accounted for, I am sure. Therefore, each teapot takes 30 minutes to
make, or one half hour and in materials he has $2.00 in materials.
12. Peter the potter has a small studio. He works for himself. He has no
employees. He rents it for $100 a month. His electricity is $25.00/month. He
smiles to himself that he can still get electricity for $0.06/kw/hour with
no rolling blackouts. Unfortunately, he can't get natural gas. He's way out
at the end of the road somewhere so he has propane. Costs him $30 a load to
fire his 24 cubic foot kiln once a month and an additional $20.00 per month
to heat the place. He didn't want to use a wood stove. Peter the potter
lives quite frugally. He has a composting toilet so he doesn't pay for
sewer. He has a drilled well so he doesn't pay for his water. So he has to
calculate the overhead of his studio and apportion some of that to these 12
teapots. Total overhead is $175.00 per month. Divide that by 30 days/month
is $5.83 per day to cover the overhead of his shop. Or if he works a 10 hour
day, $0.58 per hour or roughly $0.01 per minute. (Now I know some potters on
the list are mathematically challenged, but hang with me a few more minutes
here)
12. At $0.01/minute of overhead time, and with 420 minutes into his 12
teapots, there is now an additional $4.20 added on to 12 teapots or an
additional $0.35 per teapot.
Time out. Costs so far per teapot: Clay and glaze $2.00
Overhead .35
13. Peter the potter is not like most potters he knows. The other potters
just work for free. But Peter the potter is smart. He figures that he's
worth about $20 an hour for his time. He is self taught, no school loans to
pay back. He drives a beat up '65 El Camino Conquista that he paid cash
for.( Peter the potter does some retail craft events.)
Time out: If my math is correct, it takes Peter the potter 30 minutes to
make each teapot. So the simple division works out to an additional $10.00
in labor per teapot. Do the math. I get $12.35 total per teapot.
14. Peter the potter not only recycles mostly everything he can, he also
delivers his work to the stores that carry his ware. He has no packing
materials to charge for. But, being so smart, he does charge for delivery.
The drive to Bob's Craft Shoppe and Emporium takes him 2 hours round trip.
Bob at the craft shop wants to buy 4 teapots. Peter the potter still figures
he's worth 20 bucks an hour, but while in town he can stop and run some
errands and pick up some tofu and other food at the coop, and stop by the
pottery place, kibbitz with the guys there and pick up some supplies. So he
only charges really, for one way. Divide the $20.00 by 4 teapots and you get
a $5.00 charge per teapot. Now I know this is a bit much even with recycled
liquor boxes and ejnd rolls from the newspaper, so lets be fair and add half
that to the costs, the total now being $14.85 per teapot.
15. Peter the potter sells his work directly. He wants $50.00 wholesale for
each teapot. His terms are payment in full upon delivery. Peter the potter
smiles to himself as he pockets the check for $200.00, thanks Bob at the
Craft Shop and Emporium for the business, and then drives home.
So why is Peter the potter so happy?
Peter the potter makes a great margin on his teapots. In fact, if you do the
math, he's doing better then even just keystoning the work to Bob's Craft
Shoppe and Emporium. But lets say it takes him all totaled $25 to make that
teapot. He sells it to Bob for $50.00 He made his markup. He is still in
business.
The point is, after reading this little story, and yes, I know it is
simplistic and the pricing might not be that accurate, if you know how to
price your work and make a PROFIT on what it costs you MAKE the work, you
think like a business person and not like a potter. And if you structure
your wholesale price or even work at a 50/50 consignmenet, you are making
money. Even better if you get 60/40 consignment.
We all may love what we do. But its what is left in your pocket at the end
that matters. Don't work for free, price your work correctly, rejoice in
that you are doing what you want to do and can make a profit if you think
about it!!!
Jonathan
 
