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There Is No Magic Sewing Business Pricing Formula
Sewing business pricing is one of the most difficult tasks for the sewing business owner. There is real fear about setting prices for goods and services. Why so much reluctance to set prices? Many sewing business owners are afraid that if they set their prices too high, then no one will buy their goods and services. Then there are those that are afraid that if they set their prices too low, they will not be compensated fairly for their goods and services.
What to do? First understand that there is no magic formula to for sewing business pricing. In other words one price does not fit all.
Sewing For Others
In her book Pricing Without Fear – A Sewing Entrepreneur’s Guide, sewing professional Barbara Wright Sykes discusses three pricing methods that can be used to set prices for a sewing business that sews for others.
These methods are:
1. Flat Fee
2. By The Hour
3. Integrated Pricing Method
The general formula is: Overhead expenses + desired salary = Base hourly rate Hours committed
The components of this formula needed are: the total cost of overhead expenses, the total hours committed to the business, and the desired salary.
When are each of these formulas used?
Flat Fee: this method is for a sewing business that is standardized with no variations in their product offerings. The price list includes all of the items produced with no additional charges for design details.
By The Hour: this method is used when there is a niche with a limited number of sewing professionals.
Integrated Pricing Method: this method is used when the business sells goods and services.
There are some good examples for each of these formulas in the book that might help the business sewer to determine what would be a fair price to charge for goods and services. The book is also a good source of sample sewing business pricing lists for different types of sewing, such as home décor sewing or sewing for children. Barbara Wright Sykes pricing book with the chapter on sewing business pricing is an excellent beginning for sewing business pricing.
Teaching Sewing To Others For Profit
If you teach sewing to others for a living, whether full or part-time costs must be covered and a profit earned.
The first thing that should be done is research the market, according to The Business of Teaching Sewing by Marcy Miller and Patti Palmer. This should be done in order to find out what is already being taught in your area, and how much is being charged.
The next thing that should be done is to determine what you need to earn annually, and see if you can actually earn what you determine. Accordingly the rate that should be charged is $25 - $50/hour for actual teaching time to cover time for preparation, organizing, set-up, promotion and marking for each class. There will also be an investment in equipment, project samples, posters, slides, model garments, printing, forms, and travel. You might also choose to invest in additional education for yourself, so this will have to be covered. As the business grows, other teachers may need to be hired as well as administrative staff. All of these costs need to be built into the hourly rate, so that enough can be earned to cover costs and earn a reasonable profit.
There are numerous examples given in The Business of Teaching Sewing that demonstrate that there are really no hard and fast rules for pricing, and it might be good to take a look at these examples.
Because there are no set rules for sewing business pricing it is very important to do extensive research to see what pricing is being used in the industry based upon what is being taught, for how long classes are being taught and where they are being taught, to make sure that proper value is placed upon the teacher’s time.
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