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| Pricing cards |
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Pricing cards
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When you first decide that you want to start selling your card creations, it can be difficult to know how to price them. Pricing may not be as straightforward as it may seem. It all depends on how you're planning to sell them as most ways of selling involve a cost that may be overlooked if you don't consider it carefully.
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| Wholesale selling |
If you are selling to a shop for re-sale, i.e. not to the end user, this is wholesale selling. The normal retail mark-up if you're selling to a shop is 100% plus VAT. That means that a card that you're selling to them for £1.00 will normally retail at £2.35, perhaps a little more if the shop is in a high rate area such as in a high street or busy shopping area. A card selling in a shop at £2.95 will usually have been sold to them for around £1.25.
Pretty shocking stuff, some of you may think but this is normal. Shops have to pay for rent, rates, staff, credit card costs if taken and other overheads as well as making a profit at the end of the day. If you sell through agents, their commission will also be deducted from the cost.
If you're only likely to get £1.00 or £1.25 for your creation, is it really worth the time that you have put into it? Sometimes not. Some cards that require a great amount of work and time will not be suitable for wholesale sale. Generally a card for sale to a shop should take no more than 10 minutes to make. Any longer and you'll be losing money, not making it.
So if wholesale selling isn't for you, if you're surprised at how little you could make out of it, what are the alternatives - how much more money can you make if you sell retail?
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| The cost of selling |
If you are selling your cards directly to the end user, i.e. the giver of the card, this is retail sale. Most retail methods of selling cards have a cost attached to them.
If you sell your cards at craft fairs, the cost of the stall is of course your overhead. You should also take into account the money that you will spend on petrol, refreshments and lunch if you haven't taken anything with you
If you choose to sell your cards on your own website, you have to consider how you are taking payment as most ways will have a cost attached to them. If you are paying cheques into a personal bank account, it may well be that these are free to deposit. If you have a business account, this may not be so as many banks charge around 60p per cheque to deposit into it.
If you decide to take Paypal through your own website or on Ebay, these have a cost per transaction which is a minimum of 20p and a percentage of the amount taken.
If you wish to take credit/debit cards and choose a third party card processor like WorldPay, as we do on our site, the card fees start at 50p per transaction for a debit card or 4.5% of the transaction value if it's a credit card used. This is on top of the annual fee charged and the initial set up fee.
Even if you have a 'card party' at home and invite friends and neighbours round, you should also consider the cost of the wine and nibbles that you will probably lay on.
As you can see, it costs to sell retail and this must be taken into account when pricing your cards.
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| Minimum order for selling by mail order |
Because there is usually an overhead involved when you are selling, it may be worth considering a minimum order if you sell by mail order, such as through a website or on E-bay.
As an example, if you take Paypal, this will mean that you will be 'losing' 22p or so in fees every time someone orders. Say your cards are £2.00 each and you also offer free postage on all orders. That's £2.00 less 22p for Paypal, less 32p for the stamp and you mustn't forget the cost of whatever you send it in - a board back envelope may well cost you 25p or so. That means that you're down to around £1.20 for your card. If you then deduct the cost of the materials to make it, say 50p including the card blank, envelope, card bag and embellishment, you're looking at around 70p for your time before even considering your profit. Not much, is it?
For this reason, it may be worth imposing a minimum order of, say £5.00. This is probably only 3 cards remember but it will start making your sale a bit more worthwhile.
Don't for a moment consider not offering Paypal or credit cards, however. If you only take cheques, this means that someone has to go to the effort of writing a cheque, addressing an envelope, buying a stamp and trotting to the post box to post it to you. Compare this to tapping in a few details on your computer and having cards appear in a couple of days in the post. The benefits of accepting payment by credit/debit card far outweigh the cost involved - as long as you consider, and take measures, to deal with the implications carefully.
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| Market value |
You must always consider the 'market value' of a greetings card when pricing; i.e. your card may have taken a couple of hours to make but how many people would consider paying £10.00 or more for a greetings card?
If you have an incredibly simple design and decide to sell them for 50p each at a craft fair, you risk customers thinking that they must be shoddily made or using poor quality materials as this is less than the price a greetings card would normally cost, especially a handmade one.
A fair price for a A6 sized card with a low to medium amount of work is around £2.00. This is for cards sold on a retail basis, i.e. direct to the end user - to friends, at a craft fair, card party, on E-bay or on your own website. If the card is very involved or desirable, this may be as much as £2.95 or so. Larger cards will usually be more, perhaps £2.50 - £3.50 for an A5 sized card. Boxed cards will usually sell for more - perhaps £3.50 - £5.00 but remember that the quality and design of the card must match up to its presentation!
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| Offers |
It's great to offer an incentive to buy more by showing it as an offer - e.g. 'All cards £2.50 each or 3 for £6.00'. This means that you're still getting £2.00 for each card sold but many customers will not be able to resist your bargain and will buy 3 cards. At £6.00 per sale, this is definitely worth considering. This will work for all retail selling methods - on websites, craft fairs and at card parties, for example.
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| No cost selling |
There is only one way that I can think of to sell cards without a cost involved - and that is to sell to people at work, or in other people's workplaces for that matter. And this, by the way, is a great way. If you work in an office, you have a captive audience. When I worked in my long-since-forgotten (thank God) insurance broking job, there would often be something up for sale by someone-or-other or someone-or-other's sister. It wasn't seen as an inconvenience but a great way of getting a pressie for the other half/friend/relative without actually going to much effort.
Had I still worked there when I began making cards, it would have been great. Especially as I worked with a lot of men who would have bought anything to save going to the shops and making up their own mind......... Fortunately for me, my other half and my best friend still did work in offices and I used to send boxes of cards in with them. Always made good sales that way and produced a couple of interesting commissions.
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| Summary |
It's easy to under-estimate the value of your own work if you're selling in a retail environment and perhaps to over-estimate it you're selling wholesale, i.e. to shops.
It's worth doing your own market research when deciding on the final price for your cards. Go to craft fairs, look around the card shops and look at the prices carefully. It's too easy to find yourself examining the design if you see a card you like and completely forget to look at the price! Look at the prices in shops and work out the price that was probably paid by the shop-keeper. See how you think your work compares to what you have seen.
And if you just don't think you can sell your little works of art for a reasonable enough (market) price, save them for your nearest and dearest, who will probably appreciate all the hard work that has gone into them all the more.
© S. Goble/Mad about Cards Ltd, March 2005. Updated June 2006.
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