Crafts Report: Public Opinion

WHAT'S YOUR OPINION?

Each month, The Crafts Report invites readers to respond to the Public Opinion question. Responses are published in the magazine.

This month’s question is: Do you think craft can be mass-marketed through larger chains and department stores while retaining its handmade value?

Please respond by Feb. 8, 2002. Responses to this question will appear in the April 2002 issue.

E-mail:
publicopinion@craftsreport.com; or CLICK HERE

Send responses to: “Public Opinion,” The Crafts Report, 300 Water St., Wilmington, DE 19801; fax: (302) 656-4894.

Anonymous responses will no longer be published.

In my consignment agreements, I specify a price that I will be paid when the item sells. I set this at 70 percent of my retail price. I feel that this is fair since I am providing inventory to the store until they sell the piece. I prefer to sell wholesale at 50 percent of my normal retail, so I only have a few consignment shops.

I don’t mind if the store can mark the items up and still sell them at a larger profit for them. If they are selling well, then I am getting more than if I was wholesaling to them. If the stock is not selling, then I will pull it and either sell it myself or put it somewhere else.

I once had a piece in a store that took 50 percent of the consignment. It was an expensive piece, so I wasn’t surprised to learn that it didn’t sell right away. However, after several months, I got a little worried, and so did the storeowner. I went to the store, and couldn’t believe that my beautiful ceramic vase was displayed on the floor, in a dusty corner of the store near an office. I asked if it could be moved up front, and it sold that week. They got 50 percent of that sale, more than I will ever allow again.

A few years ago, I was deeply involved in a startup, nonprofit, regional craft business, building a membership organization that would eventually fund itself through a storefront for local craftspeople. … After going over projected budgets for the year, I saw clearly an operational budget working on less than a 50 percent markup severely impacted the success of that store. … A percentage reduction of a few consignment fees meant we had to almost double our sales. Working on a 40 percent commission was killing us. I’ve gained new respect for store and gallery owners. I’m not sure I could make a profit on my business if my inventory costs were 50 percent of my gross profits!

I also realized that, if the wholesale price I was getting for my work didn’t seem fair, it was because I’d fallen into the trap of figuring a wholesale cost backward from my retail cost. This is such an easy mistake to make when you’re first starting out in business. Now that I regularly assess the real cost of making my product, and make sure I make a profit on my wholesale price, a gallery commission of 50 percent doesn’t bother me at all.

I’m comfortable with 30 percent, but I expect the gallery to be active in promoting itself. Meaning, if I get involved with a gallery that is going to take 30 percent of the sale price of one of my pieces, I hope that they will do all they can to make that sale and to promote their gallery to consumers.