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Watching the price of gold continue to increase so drastically over the past couple years, I've been a bit like an ostrich - with my head buried in the sand. Occasionally I'd peak out flutter my prices up a bit and think that was good enough and how I felt bad for increasing the price for my customers. Alas, the time has come that I'm having to truly evaluate everything with a fine tooth comb. Part of this occurrence is the fabulous accountant I have. I've become a lot more organized and actually calculate my profit and loss each month. *Gasp* (That's what I do when I see it calculated)
And it is time I quit keeping my head buried, quit being in denial, and realize that my cost of materials has gone up so. much. more. than I have raised my prices. In the past year, gold has gone up about 33%.... in the past TWO years - gold has nearly doubled... While, apparently I've raised my prices less than 10%. So if you know anything about math, I think you can see how the price of gold really affects my income. Instead of getting a raise, I've been demoted... It all goes back to that being in denial and thinking the price of gold will go down and it'll all be okay.
So I've been doing some seriously calculations and changing prices - some quite a bit and some not so much. But I am feeling a bit more secure that I'm not merely buying gold and giving it away.
I'm puttin' on my big girl pants and realizing, that yes, this is what it means to run a business. I love my customers and I want to provide an excellent product at a fair price - fair, for both of us.
Oh and what do raising temperatures have to do with it all? I have no idea, but it is darn hot in my studio. I'm ready for fall - and falling gold prices. One will come in a couple months - the other... well... I don't think I can keep my head in the sand that long.
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6 comments:
tough choices...but you have to eat!
oh,Beth, for what its worth, we are all feeling your pain!....really is hard to put on the 'big girl pants' but we just gotta....more important though is to do what you need to do to make your biz really work, so that everyone can continue to enjoy your wonderful work!
thanks for the support ladies! and kerin, you're right - if I don't make changes, my business probably wouldn't continue in the same direction...
I feel for ya Beth. I've been sticking my head in the sand myself. My materials costs for pots aren't bad; It's the pricing things appropriately for the time they take. Packing and shipping costs are eating me alive too. I know I need to re-evaluate but have been putting it off. and off. and off. eek!
Those are other things that definitely factor in highly - especially for you! I was just thinking about that when I was repackaging the present for my friend. And was actually thinking of emailing you b/c I think I paid less when I shipped it to her than you had paid shipping it to me... (i'll email you on etsy) I recently updated my packaging to be a bit nicer, more professional, and all recyclable. One thing that I think is going to help is that when I total my expenses every month, I have "packaging" as a category of its own - that way I can find out how much I really am spending on packaging!
Good for you, Beth! I have had the same "head in the sand" problem. Such a painful and scary process, but necessary. Thank you for sharing and giving others a boost of confidence to make the change!
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