How to price your work: A guide for artists, creative entrepreneurs and small arts organisations
Deciding on the right price for your work is something that comes up regularly in my creative business coaching practice.
It’s a tricky thing to work out because we can often feel uncomfortable about money and placing a financial value on things, we can also feel overwhelmed by the wide range of possibilities and the fear of “what if no one buys it?” and also we’re often pricing up something a lot more intangible than a product you buy wholesale and then sell retail. Finding the right price for art, for a creative service or simply for your time can really boggle the mind.
There’s good news and bad news with this.
To get the bad news out the way: there is no magic wand solution - you have to work it out for yourself based on your circumstances, needs and desires.
The good news is that there are loads of tools you can use to come up with your pricing strategy.
Whether you are pricing your creative output or the time it takes to create it, ultimately you are trying to work out
Time expended + materials + overheads + profit = price
I used that tricky word profit there. How does that feel? For those of you who have mostly hung out in the subsidised non-profit creative sector, the idea of making money can feel really icky, but subsidy for the arts is dwindling and it is about time ALL (arts companies: charities; social enterprises; individual artists; freelance creative folk; sole traders and more) make the leap into increasing their profitable activities and look at ways to bring in more dosh without grants.
Time expended: There may be a union rate for your artform or sector, check out the Musicians Union, Scottish Artist Union or Equity as examples (and if not from round these parts you can adjust accordingly).
Materials: Entirely depends on your business, but you’re the expert on these as you bought them. Proportion fairly so, for example, if you bought paint that would last 6 big paintings, divide by 6 to get a per painting cost.
Overheads: This is all the costs that aren’t directly project related. Heat, light, internet, insurance, phone, accountancy, admin, marketing, project development. You might have a team or outsource these which would give you a clear fixed idea of the costs, but you might be a sole trader super hero (welcome, comrade!) who does it all yourself so you’ll need to think about how much time all this takes. You can work out how much all your overheads work on a daily rate (divide the annual total by number of days you are willing/able to work in any given year). That daily rate can then be applied to product creation or service led project.
Profit: This should be based on what you want to make across a month or the year. I recently discovered this handy calculator which is best suited to graphic designers or those with similar commission based business models, but it applies to lots of other businesses so you can work out your billable hours. Think about how many hours you can (and want to) spend on your business each week. How many of those will be sucked up in the background/administrative/development stuff? Be realistic on this. Then you can work out how many billable hours you have with the remainder.
Market testing: Once you’ve looked at those figures, you then need to see if that price is possible to achieve. This is the trickiest one as your inner critic is likely to kick off and tell you that no one would want to pay that much for your work. Think about who your ideal client/customers are - they might be similar to you or they might be different, with different scales of affordability. Check out other businesses that are doing similar things to you and see what their pricing is. Don’t undersell yourself, but also be realistic about what is possible.
I appreciate I’ve whizzed through all that and just one small element, like ideal clients, could take quite a bit of exploration. If you could do with some extra support, sign up to Coaching WIth Sarah for a few months and we can work out a pricing structure that is sustainable for you, achievable and realistic.