Thereâ€™s not one week goes by, Iâ€™m not asked to explain how to set prices for a painting.
The better question is â€¦â€¦.. How can I get my paintings sold?
So, Iâ€™m going to take a couple of issues and try to nail down a formulae that worksâ€¦â€¦every time. Something onto which you can really hang your hat.
You see, its one thing to mechanically set a price for a painting and quite another to â€œsellâ€ that painting. Just setting a great price is not enough to getting a painting sold.
There was a movie a few years ago, Field of Dreams that really became a craze. In the movie, a farmer standing smack dab in the middle of a cornfield hears some whispers that drives him to clear part of his farm land to build a baseball field. When he does, all the spirits of baseball players past get together for another game. The whispers said, â€œIf you build it, they will come.â€
Now Iâ€™ve heard that silly statement applied to just about every kind of situation imaginable. But let me end this right nowâ€¦.. â€œIf you price it, they will not come.â€ Sorry folks, the movie was simply entertainment.
Yes, there is a very specific process you must undertake to set the right price. And then there is a very specific process you must undertake to find the right buyer.
Iâ€™ve spent over 3 decades in the marketing of high technology products. I have brought in contracts for upward to $60 million for software products. The very same formulae for marketing high technology products works equally for selling art. We must have the right products to sell to the right person at the right time for the right price to meet the right needs with the right terms and conditions. Marketing is all about getting it right.
With this said, let me explain a couple of methods to setting the right price.
First and foremost, the first rule of pricing pricing is â€œprofit.â€ Know your costs, know how much money you want to make and than see if the market will bear the price. You can adjust up/down afterwards to compensate for true market conditions. The influencers include, but are not limited to your reputation, your style, quality of your craftsmanship, your location, the painting, the story within the painting, and much, much more.
#1: Hourly: Letâ€™s say you feel your hourly rate is worth $20.00. If you take 5 hours to do a painting than you would need to charge $80.00 for labor alone. Now you need to add materials. Letâ€™s say you paid $8.00 for a canvas, $10 for supplies including pens, pencils, tracing paper, paints, etcâ€¦ Now take that number ($18.00) and multiply it by 3.5 That equals $63.00. Round up to $65.00. Now go to overhead. Do you pay any fixed amount monthly in order to have a studio or anything? Letâ€™s say you do this on the kitchen table using no new services. So charge $5.00 for overhead. Multiply by 4. That means $20.00 for overhead. So your profitable price would be:
Materials $ 65.00
Overhead $ 20.00
Your target is to sell that painting for $185.00. All you have to do is find a buyer.
#2 Testing what the market will bear: This is finding what the maximum anyone will pay for your painting. To find this out start with the price you come up with using step #1. If people buy without hesitation, up your price for the â€œnextâ€ painting by $25.00, and keep going up with each â€œnextâ€ painting until you find a price level people will stop buying your paintings.
* You do the aboveâ€¦â€¦â€¦â€¦.$185.00 people are happy to pay.
* Add $25.00 for nextâ€¦â€¦â€¦.$205.00 people still happy to pay.
* Add $25.00 for nextâ€¦â€¦â€¦.$230.00 people still happy to pay.
* Add $25.00 for nextâ€¦â€¦â€¦.$255.00 people still happy to pay.
* Add $25.00 for nextâ€¦â€¦â€¦.$280.00 people still happy to pay.
* Add $25.00 for nextâ€¦â€¦â€¦.$305.00 Nobody willing to pay.
This would mean that your price for a painting is between $280 and $305.00. Now you would start adding $5.00 for each â€œnextâ€ painting you do until no oneâ€™s willing to pay. Then you will have what the market will bear. For our example, letâ€™s say $280.00 is the market price of your 5 hour paintings.
Now you really know how to price your paintingsâ€¦.
Youâ€™re receivingâ€¦â€¦â€¦â€¦â€¦..$ 65.00 Materials
â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦$ 20.00 Overhead
â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦$ 195.00 Labor (Thus your new hourly rate is $40.00)
Now whenever youâ€™re asked to do a painting and you think it will take over 5 hours, you simply multiply the additional hours by $40.00.
There are more strategies than this in the pricing of paintings, but for someone starting out, the above will help to bring together both your time/skill set value.
Next issue Iâ€™ll talk about the process to find the right buyer. We do not want to be like the hamburger stand at a vegetarian conference. So we need to understand how to go about finding the right people that will buy our paintings. Weâ€™ll answer questions like â€¦. Who are they? Where are they? Why do you paint? How to talk to them once you find them, etcâ€¦
Now if youâ€™re just starting to learn to oil paint, donâ€™t worry about pricing. When I first started, I often bartered. Someone wanted a painting, I said sure, next time youâ€™re out shopping, buy me a fan brush. Most people are willing to do this. It helps you. But after awhile, its nice to get that happy buck.
So work on your craftsmanship and when folks start asking you how much you want for a painting, try the above formulae.