Friday, February 05, 2010

etsy: to discount or not to discount?

I have recently received several inquiries via etsy from people wanting a discount on my handknit wool soakers.

The most recent was from someone wanting 4 newborn soakers at a discount.

At first I was angry and insulted. I hand make these soakers with the same attention and care I give to items for my own family. I carefully hand wash and air dry each one separately, then pack and ship, all as quickly as possible. My prices are very, very low and I agonized over raising them by $2 when the price of the wool I use went up and I was making even less money. I tell customers they will receive their item within two weeks, but it is more often one week because I work quickly, putting aside my personal projects to get these soakers out the door. Once I have someone's money, I feel guilty until they have their item.

When I do the math on these soakers, I am "earning" probably about $2 per hour, and each newborn soaker takes probably about 4 hours all together. I don't know for sure because I'm just a stay-home mom trying to earn a little extra student loan money around my kids' schedules, so it's not like I sit down and make one soaker start-to-finish.

And therein lies my disappointment and sadness when someone asks me for a discount on this handmade, high-quality, long-wearing, extremely useful item. If you browse etsy, which I did when trying to set my prices, you'd see that I charge much less than most people, including those who make soakers and longies from recycled wool sweaters. I'm not saying those don't require work, but it is less work to cut up a sweater and seam it into pants than it is to hand knit those pants from scratch.

I offer a newborn soaker for $18. This is an item you would use literally every single day around the clock. Is that not worth $18? I might also add that I INCLUDE SHIPPING in my price! So after the cost of the wool (about $4 or $5), first-class shipping ($2), and etsy/paypal fees (about another $1), I am already down to $11 earned. Divide that by 4 hours, plus the driving to go get the wool, and I am making a pittance.

But I do it because that pittance is more than zero, and I can do it from the comfort of my sofa. And sometimes I have a really busy month where I can earn an extra $100 to send off to the student loan people. Hubs always says to keep that money for myself, but I like to feel I am contributing something to the family. It is a point of pride. Yes, sometimes I'll use a few dollars to order something I want or need, but more often than not, any money I earn goes toward a family need.

So I would love to make these 4 soakers. I would prefer to make them at full price. However, I feel fairly confident that when I write back to this potential customer and tell her that, she will not order. Am I cutting off my nose to spite my face? Should I go ahead and offer her a discount of a few dollars off each? Is it better to take, say, $60 for 4 soakers rather than $72 just to make some money? I'm really not sure. As etsy buyers and sellers, what do you all think?


Louise said...

I am not an etsy seller (yet), only a buyer. But I don't think you should discount. I have had issues before with friends who asked me to make things for them, and being "nice" I agreed. But then they don't appreciate all the work and effort that went into these items. I think etsy is the same way. You should stand up for the quality of your work and price it accordingly. "Handmade" doesn't equal "less expensive" (except maybe to the person who made it!).

Karen said...

I don't think you should discount them. Your prices ARE low-- plain and simple. The same people who are asking for a discount are the same people who are paying $25.00 for ONE custom fitted diaper. Or $60 for one pair of custom knit longies. Wool diaper covers command their price for a reason-- wool isn't cheap and they're time consuming to make. Hello? Not made in China.

Maybe offer her free shipping or something. Your work is far too superior and your time is worth more than $2.00/hour. Or what about doing a bunch of soakers out of yarn remnants to clean out your stash and price those lower because of the wonky color combos. :)

April said...

I would have a hard time with this as well - for a handmade garment especially. However, I think you might be thinking too deep a discount. I'd make her feel good by offering a discount, but not so much that it hurts your overall net. So, $72 down to $68.00 ($1.00 off each one)... it just sounds better - in the $60 pricing category. Worse case, $65.00. You keep a customer, maybe she'll spread the word about you? But, don't discount too much for that very reason. You do it alone by hand - you don't have a knitting machine or have a team of people.

Mrs Lemon said...

Maybe the buyer doesn't realize the quality they are receiving? Marketing is everything - try rewording your description to showcase your expertise. That is straight up out of my *cough* BIG GREEN BOX tax employer's marketing. Talk about how much experience you have and the buyer will feel like they are getting their value.

That being said - when I first started cloth diapering I would have choked at a price like $18 for a cover too, but I was not as informed as I am now. Now - if I was doing wool soakers, I would definitely pay for that. Make sense?

April said...

OKay - just found something that Karen needs, but in a pinky way. ;)

(totally off topic, by the way - well, sort of...) I would have been all over these in a heartbeat! My kiddos ALWAYS wormed their way out of the blankets just wrapped around them - no matter how tight.

emy said...

Perhaps in your listing, you could work out the maths of what a $18 woolsoaker works out to on a daily wear basis?

And work shipping pricing separately so that as they purchase more, perhaps the shipping fee is reduced?

For the current customer asking for a discount, it's a little tricky. Give in and she may spread word that you give discounts and you will end up dealing with more of such customers in the future.

Do what your heart tells you.

Or throw in a crochet flower pin for the mom if it doesn't take you too much time.

In short, better to give a little surprise & delight, then offer to accept less $$.