If you sell your own work…

Several artists I very much admire (I’m not naming them because I haven’t asked their permission) got into a recent discussion about the difference in some fees charged by the Square credit card processing system. A comment was made about this being higher than that … but the formulas were different. There had to be a “break even” point where they matched! So I immediately calculated those values for my own benefit.

And then this evening I just had to go back to some good old graphing software and produce this plot. This applies specifically to the Square system as of April 6, 2023. Other credit card processors calculate their fees differently, both in their formulas and any various categories. But Square is one of the more common ones you’ll see used at art fairs, so I thought some of you might share an interest in this..

Always the lowest fee (purple line): charged in-person, using their card reader.

Next lowest (red and green lines swap at the green circle): 

• Under $25, when you manually enter the information or a card stored in Square’s system is used;
• Over $25, a purchase processed online through Square.

Highest (red and blue lines swap at the blue star):

• Under $75, when you invoice the buyer through Square;
• Over $75, when you manually enter the information or a card stored in Square’s system is used.

I can understand the logic of a higher fee for an invoice: Square is providing an extra service that involves more steps through their system.

But I agree with the folks who started this discussion: I can’t think why the fee for using a card stored in their system creeps higher, relative to their other categories, as the total amount processed at that time goes up.

Can you? If so please leave me a comment!

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p.s., There are yet more fee structures, but I thought that graph had enough lines already! For instance, if you offer the Afterpay service, the vendor’s fee for that (at least through Square) is higher-still, 6% + $0.30. [Editorial comment: The pitch is that the vendor will get more sales and be paid in full. Since Afterpay has to both cover the float and deal with any problems with the later payments, the higher fee compensates them for all that. I don’t rely on an online shop for the bulk of my income but, as a shopper, I know that vendors are now factoring the possibility that “you” will use that service into the price that “I” will be paying even if I simply hand over cash, contributing its own little factor to increasing inflation…]

What constitutes a “fair” price? (part 2 of 3)

In Part 1 of this series, I raised the issue of how to determine reasonable prices for the pieces I create, prices that appear consistent across various designs and media. This is getting trickier as I have added materials such as bronze, copper, and steel to my repertoire, and thus moved beyond the silver and, occasionally, gold that I started with. In that previous post, I talked about issues such as the time directly involved in various aspects of creation, including that devoted to preparation, firing, and finishing of each piece. In this one, I will address a number of business-side issues: they include some aspects of creation that are perhaps better grouped together under the category known as …

Overhead. Even though the bronze / copper / steel raw material itself costs less than silver, there are many other higher or additional cost involved in working with the non-precious metals. Here are just a few examples from “behind the scenes” with those:

• Beyond how the firing requirements of these metals impact my time (discussed last time), each piece that size also puts 8 times the wear & tear on my kiln when compared to a similar piece made from fine silver. On top of that, other kiln-related factors like the time and temperature combinations and the oxygen-reduced atmospheres used with these clays will further shorten the expected lifetime of the kiln. While I do still expect the kiln to last for years, I also figure that I need to add a bit more to the price of each base-metal piece so that, when the time comes, I will be able to replace that relatively expensive piece of equipment earlier than might otherwise be expected.
• Covering the cost of firing boxes and carbon will also add a little bit to each copper, bronze, and/or steel piece too; they are not needed with the precious metals.
• Each time I use a new kind of box or of carbon, there’s both time and material involved in testing the firing schedule. I should somehow spread that (small but real) cost over a range of subsequent pieces too.
• I’m still working out which tools to share across the various metals (meaning I have to spend time cleaning them thoroughly each time I switch between the precious and non-precious metals) versus which tools I use often enough that I should just buy another copy of the same one to use with the base metals (and clearly label each so I don’t get them confused, and have to spend time washing anyway). Either way, however, there are small portions of the total cost to be spread across a number of items I’ll make with them.
• I ended up buying a small refrigerator for my studio too: while there is a nice little bonus in having that to keep some lunch and beverage items cold, I see it as overhead for these pieces because I need to freeze any pre-mixed clay that I don’t use in a single session.
• For pieces that require extra finishing time, there is also the cost of extra items used for sanding and finishing since they will thus wear out much more quickly. That also adds a little more to the cost of each such item.

That’s not even a complete list of the extra costs, but it’s a good sample of them. Now, none of those involve earth-shattering amounts. But there are other forms of “overhead” to be accounted for with every piece made, regardless of medium, and then every time you add a few cents for this, and then a few more for that because you’re working with base metals, and then you apply the appropriate mark-up factors (e.g., gallery commissions) to the whole thing …. well, the sum-total of such additions simply runs up the final price of any artwork.

(It is probably worth noting that some price formulas treat various overhead costs in entirely different ways. Some approaches do exclude a lot of factors directly, on a theory that goes something like this: If, for example, Ethel’s studio rental is $X / month, while Fred’s studio costs half that and Lucy works out of her home, and they all do comparable work, does that automatically make Ethel’s products twice as valuable as Fred’s, and even Fred’s more valuable than Lucy’s? Instead, all three could charge an appropriate amount for their time, and then pay any rent out of those earnings. If Lucy and Fred are able to work in cheaper spaces than Ethel, then any money left over after paying the rent would result in a “bonus” for finding economical work-space. Even if I go that route, however, I still need to be sure I’m charging enough somehow to cover “overhead” costs out of earnings.)

But that’s enough from me now on overhead for now. Have you encountered any other important factors, ones that I’ve overlooked here, in working with base-metal clays, that you feel drive up their price? Stay tuned, too, because I’ve got one more post dancing around in my brain that addresses a few other issues related to all this. (The big question, as ever, is when I’ll find the time to get those ideas to move from my brain down to my fingers and onto a blog post! It’s likely to be at least a week, maybe more….)

[Update: Yes, well, that “maybe more” was right. I got sidetracked into a variety of other projects in a number of other areas. And, with metal clay, I’ve been trying to work out a number of new ideas. I’ll be discussing a few of those next. I do still plan to return to this topic but, when I didn’t finish it up in October, I’m thinking I may now just put it on hold until after the holiday season. More shortly….]

What constitutes a “fair” price? (part 1 of 3)

I sure like working with many of the “base metal” clays (various versions of copper, bronze, and steel). I like the results I can achieve. But I also struggle with how to price these: How do I find that balance point where customers think my prices are fair while I feel adequately compensated?

Now, I do understand the various “formulas” that makers might use to calculate the price for their work. I’m fine with numbers, whether straight from such a formula or even after “tweaking” them a bit. I can figure the cost of the materials, a price for my time and/or an amount for general overhead (rent, insurance, equipment, consumables, etc.), plus a factor for the retail side (to cover commission to a gallery, entry costs for shows, etc.). I will price a number of pieces, sort them by price, compare that to recent history of items that have sold or remain unsold, and look to see if anything seems out of line. I may adjust individual items up or down a small amount: I’ll then bring in a bit more or less on some individual pieces but, overall, I want prices to look both consistent and reasonable.

I have been getting some very positive responses to the look of pieces I’ve made this year in copper, yellow- and rose-bronze, and steel. But a few people have indicated that they would expect those to be very inexpensive, because of the material. I try to explain that the price includes factors for both material and time, and that the time for design and basic construction does not go down for a unique “art jewelry” piece just because the metal itself costs less. At that point, I’ll try to steer the discussion away from price and more into the artistry involved in various pieces.

But, really, there’s more to it even than that, things I don’t tend to go into with a typical customer. (I may cheerfully offer something like, “You’d be welcome to take one of my workshops, and learn what all is involved! This material is relatively easy to work with, and fun, and you’ll see how making a piece can take a number of hours. Give it a try!” If that gets a positive response, then I may add a few more details: “a minute or so of free lesson right now!” Though I aim to keep that light and non-technical, I may point out something like the extra steps it takes to combine several metals in a single piece.) Still, I find myself wanting to think through a bit of what else is involved, to get a better grasp on it myself. I figure I can share some of those details here … and welcome your comments!

Once I’ve figured out what seem to be the most important factors, I can try to figure out how to distill those down for a short response to a potential buyer. In this post, I plan to address prep time, firing time, and finishing time. In a day or two or three, I’ll add a second post looking at overhead costs; and finally (it may take me a bit longer to get to that one) I hope to post about some other factors, like learning curves, brand variations and, perhaps, a few other issues.

Preparation Time. I really like working with Hadar’s delightful clays. Each of those comes as a powder that must be mixed with water before you can use it. This is not difficult, but it takes some time. How much to mix? If you don’t mix enough for a particular session, then you have to take the time to stop and mix up more. So it seems better to mix up a bit more than you think you will need (although you then have to find a way to store the excess, which I’ll address in my next post, on overhead costs). That mixing-time adds to what you have to include in the time it took to make each individual piece: it doesn’t take a lot of extra time, but there is enough to count.

Firing Time. This is probably the biggest issue. Together, those four rose bronze pieces I posted about last week “filled” the firing box in my kiln. Because I need not worry about creating an oxygen-reduced atmosphere when I fire precious metals, had I made silver pieces the same size I could have fit at least four times as many into a single firing. (I could have fit at least twice as many on a kiln shelf (probably more!), and I certainly could have fired two shelves at a time.) And, since these clays must be fired twice, that means I could have fired thirty or more silver pieces in the time it took me to fire those four bronze ones!

(And, this particular issue gets magnified even more when you consider the “overhead” issues involved in all the extra firing. I’ll discuss that further in part 2.)

Finishing Time. Some designs (e.g., inlays and mokume gane effect) are very interesting to see and lots of fun to make, but do require that a lot of time and effort be expended on post-fire polishing to come out looking really great. Other styles (e.g., basic textures) are more comparable in the time they take to finish across all the different products (precious and non-precious metals alike). Still others, however, seem to come out somewhere in between (e.g., various “draped” pieces), and I’m still exploring how best to approach building those so that they are appealing to look at yet not way out on the difficult end of the scale to finish.

Those three aspects are probably the easiest to address, in very simple terms, concerning “hidden factors” in the price of a product. In subsequent posts, I’ll outline a few others. As ever, I welcome comments from fellow artists, students, customers, and other readers of this blog….

Passing 40….

Yikes … 40 …!

No: not the age of 40. No: not the speed limit. Yes: the price of silver.

I wasn’t paying attention to prices yesterday (busy day…) and missed it at the time, but silver crossed the $40-mark on Friday.

Then, apparently, investors convinced themselves that it really is going to keep rising, and they managed to drive the nominal price up to just a few pennies shy of $41 per ounce. (Speaking of pennies, all this is driving up the price of copper too … just not as much … yet.)

Yeah, I get the “economic theory” that drives investors to metals, and especially to “precious” metals. I just happen to think that many of the things that can be done with those materials should be even more precious. Why do “they” want to destroy the simple pleasure that can be drawn from small precious metal artwork and adornments? Why do the rest of us let them? What are the alternatives, for them and for us?

Why can’t “those people” go find something useful to invest in? Something practical? Something for the good of others too? Something that would benefit society? Something that would still be of benefit to them (yes, I understand that part) but something that doesn’t have to mean the detriment of others at the same time? Why is it you versus me?

Why can’t we revise the basic definition of good to mean only if it’s good for all?

Where has the year gone?

I started this blog on January 1, and here it is December 31. How can it be a year already? Weeks, sure. Months, possibly. But a whole year?

And quite a year it’s been too. The new studio tops the looking-back list for me, but then there are also all tne new projects, people, outlets, workshops, opportunities and more.

But I can’t ignore the fact that silver closed out the year trading at $30.92 per troy ounce. It had started 2010 at $16.85. For that matter, it had started 2009 at $11.33.

I wonder where it will be by this time next year? One business report indicates:

Gold rose to within USD 10 of a record high…, closing out an unprecedented tenth annual gain as the combination of a weaker dollar and global economic uncertainty seemed to pave the way higher next year. The entire precious metals complex had a stellar run in 2010, led by palladium’s 97 percent rise, in a broad commodities rally that pushed the 19-commodity Reuters-Jefferies CRB index .CRB up 15 percent. Spot silver, too, swept higher for an 83 percent gain on the year, as investors sought the white metal as an alternative to gold. It was the best-performing assets in the CRB, hitting a 30-year peak of USD 30.92 on Friday.

Investors: Please don’t limit yourselves to “plain” silver and other precious metals. Please invest in those of us who are able to turn them into lovely adornments!

Approaching 27 as I write this….

Yes … $27!…

So I thought maybe I could quit commenting on the price of silver for a little while. Have I mentioned that I seem to lead a rich fantasy-life?

The last time I commented on this, a month ago tomorrow, the price of silver had risen to a nominal price of $23/troy ounce. In the past month, it’s mostly fluctuated up and down between $23 and $24, but I had enough else going on that such bouncing didn’t seem to require a comment.

But the last three days, well, that’s another story. Today the price started bouncing up around $27/troy ounce: silver has had a three dollar increase in a mere three days!

Was it the election, or the “monetary easing,” or what? Call me naive (and, yes, I do actually understand enough basic economic theory to know why this next statement is yet more fantasy) but I just wish that “investors” would go find something else to play around with amongst themselves, and stop messing with real products that real people use. Having fouled up the housing market, can’t they please keep their grubby hands out of the metals market and more?!

I need to order the materials for the classes I have coming up, and I really don’t want people (especially the “new” participants via my new studio) to think I’m gouging them with the “materials fee” … which will come to waaaay more than what I make for my actual teaching (that is, for my own expertise). Sigh.

Another week, another dollar…

That is, today silver’s been trading at a nominal price that’s now up around $23 per ounce.

Of course, it’s not just silver. Gold is approaching $1,350/oz, and platinum is close to $1,700/oz. In that sense, of course, silver is still “relatively affordable,” so I’m not thinking of making any major moves in one of those directions. But other metals are spiking too, ones like copper and tin and more. Hmmm, where might all this be going … and what’s a girl to do while it does so?!

Still rising….

Silver clay has been available for a little over 10 years. Aside from a relatively brief price spike (well, it did last several years in the late 1970s – early 80s), the price of silver had been fairly stable for decades: a few dollars per ounce.

In the last ten years, the price of silver has risen from approximately $4/oz to $22. That comes out to an average of about a half a penny ($0.005) per day. Except it has not been a steady rise. The start of the climb was very slow, hard to distinguish from normal seasonal fluctuations.

I first got my hands on the stuff about 5 years ago, and began watching silver prices more closely. Over that entire time, the increase averages out to about twice what it had been, but still under a penny a day. (I’m doing rough averages simply to give a sense of how the situation is changing.)

Over the past year, however, the increase has gotten steeper: the one-year average is just about double the five-year average increase. Still under two cents / day but edging up to that.

And over the last six months, its crossed that barrier, with an average of 2.5 cents/day increase in the “nominal” price of silver.

But the increase continues to speed up!!! Nearly 7 cents/day over the last two months, and almost a dime (10 cents) a day if you include only the last 30 days. (That lattermost timeframe is important to me: a dime a day since I agreed to rent a studio! Aack!!)

Mind you, it’s not metal clays that are driving these increases. Investors are doing that; we’re just collateral damage. With unstable markets, economic uncertainties, questionable currencies, etc., investors shift to buying up things like precious metals. And their actions affect the prices that everyone must pay, metal clayers and other jewelers, product manufacturers, and more, and then pass on to the eventual consumer.

I hadn’t planned to mention all this a second time, but I’d had a DVD playing as I worked this morning and, when it ended, the system switched to TV which was showing The View. (I don’t normally watch it–don’t watch much TV in general–but will occasionally catch a couple minutes of something like that before I stop what I’m doing to turn it all off.) There was a discussion of “should you buy gold or platinum now, given how high the prices are” and the answer was that “there is no reason to think they won’t go even higher.” Some “expert” then started advising people to invest “in metals, but on paper” (my terms, not theirs); that is, do it via a broker so that they didn’t have to worry about storing and safekeeping the actual stuff themselves.

And then Whoopi Goldberg chimed in with, “But why not just go and buy some great jewelry?” Sadly, she was answered with a few laughs and a commercial break, and then that segment of the program was over.

But I thought Whoopi offered a great suggestion! Don’t you?

Measuring the Price of Silver.

Do you follow the “price” of silver?

It looks like it hit right around $21/oz on some foreign markets for a brief moment earlier this morning (around 4 am New York City time).

It’s back down by a few cents now (as I write this mid-afternoon) since the New York markets opened. Though prices have been bouncing around higher than “usual” for the past five to seven years, the 20-and-high-change numbers this week are still the highest silver’s been since the price spiked (to as much as $50/oz) in the early 1980s

That’s back when I first got interested in metalsmithing; it was a secondary reason why I didn’t pursue this more actively at that time. The primary reason was that I tried several different classes, all of which were very unpleasant experiences. I wondered then, and more recently confirmed, that it was just my luck to have drawn a few really dreadful teachers. But watching the raw material price climb from its historic $5/oz to $50/oz at the same time sure didn’t provide an incentive to try more classes. Instead, I just started prowling antique shops, estate sales, flea markets, and the occasional museum, to examine and admire older pieces and gain a different kind of education, a better appreciation of what others had done over time with precious metals, gemstones, and more.

Of course, the nominal price and the actual price differ as well. That $20-something an ounce is what a large-scale “investor” might pay for quantities of the stuff. They are the ones who drive the prices. The actual small-scale jeweler (and hobbyists) will pay much more, once you’ve added on the mark-ups for various brokers (those involved in trading the raw material), fabricators (who turn ingots into sheet or wire, or reclaimed fragments into the powders used in metal clays), distributors, shippers, and more. Thus, in round numbers, when the nominal price of silver is around $20, I figure it’ll cost me at least $50. (I still don’t want to think what I’ll do if the nominal price reaches $50…)

Oh, and the ounces we’re talking about are troy ounces. I resist the urge to include here a math lesson on troy versus avoirdupois weights. (Gold and silver merchants use the former; bakers and butchers use the latter.) I can do so if anyone requests it…. For now I’ll just point out that a troy ounce is heavier than an avoirdupois ounce, while a troy pound is lighter than an avoirdupois pound! Which is why a lot of people prefer metric measures: a gram is a gram, a kilogram is a thousand grams, no matter what you’re weighing.

There are many sources of information on precious metals prices, should you want to track them yourself; for now I’ll provide two links. Both have daily and historical charts, but:

• KitcoSilver.com also has hourly information for several recent days and
• At the bottom of this SilverPrice.org page is a chart that goes back before the silver price spike I mentioned above.