Pricing Your Cards
Selling to retail stores is very different from selling to individual customers at craft fairs. Stores usually buy cards in larger quantities, and for wholesale prices.For example, if you normally sell your cards for $4 each at craft fairs, you cannot expect a retail store to buy them for the same price. Stores need to make a profit, which requires them to double the price at which they buy them.
Even though your profit per card is smaller if you cut your price half, in the end, you will actually make more money. One store might order two hundred cards at once and then reorder quarterly. Therefore, it is better to sell large volumes of cards to several stores for a lower price rather it is to sell a few cards at a higher price to people at a craft fair.
Sometimes artists get so excited about getting their cards into stores, that they neglect to look at their costs of making a card. It is important to know early on that you will make a profit. Six months down the road, you don't want to find yourself working for ten cents an hour. It’s not fair to you, the store, or the rep if you suddenly quit the business because you are not making any money. Therefore, I think it is important to make sure all your numbers add up before you look for a rep.
Determining Materials CostsWhen determining materials costs, disassemble your finished card, and make a list of all the parts, including things like a spot of glue, an envelope, paper and ink. Determine how much each item costs per card. If your cards are printed, you might only have two costs: The card and the envelope.
It’s easy to have your heart set on one specific type of paper for your cards, but if the cost is too high, try to be flexible. Sales reps have often told me that artists have a tendency to be overly picky about things that store and customers don’t really care about, such as how thick an envelope is, or what kind of paper the card is printed on.
Profitability Formula
As a rule of thumb, I have found that if you make 20 to 25 percent profit on each card, then you are doing great!Use these guidelines below to evaluate your costs. If they do not match, look at where you can make adjustments by either using less expensive materials or changing the design.
These percentages are based on wholesale prices. For example, if I sell my cards to a store for $1.50 each, my goal is to make a profit of at least 20 percent (or 30 cents) on each card.
Aim for the following, as if it were a round pie with separate segments. If you want to sell your card at a different price, just substitute your number in place of the $1.50 and do the math.
- 15 to 35 percent of the 1.50 is for materials costs mentioned above (22-52 cents).
- 10 to 20 percent of the 1.50 is for labor of making the card. (15-30 cents).
- 10 to 20 percent of the 1.50 is set aside for overhead costs (15-30 cents).
- 20 percent or more of the 1.50 is your profit (30 cents).
- 20 percent of the 1.50 is for a sales representative (30 cents).
If you can only ask one question, ask this one: “If I sold as many cards as I wanted, will I make enough money to be happy?”
Alternatively, you can break this down into the following:
- After expenses are deducted, how much profit do I make per card?
- How much money am I making per hour?
- If sales doubled next month and I need to pay someone to help me, can I afford it?
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The Greeting Card Business
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Get Your Greeting Cards Into Stores: How to Find and Work With Sales Reps (Updated 2017 paperback) If you like to make greeting cards, this book explains how to get your cards into stores and sell them nationwide. Learn about changing trends in the indie card market and niche opportunities available for artists. Book includes detailed guidelines on pricing cards for a profit, getting professional feedback on your designs, finding sales representatives, pitching your card line to them, approaching stores, and the industry standards you should follow. Information is also applicable to gift items, such as magnets, journals and calendars.Start and Run a Greeting Card Business From a British author, whose country has a long history of greeting card design, she takes you step-by-step through the process of starting and running your business with lots of useful practical advice to help you, including: - Deciding what type of cards to produce - Finding your market - Dealing with printers - Copyright and licensing - Pricing and profit. Kate's note: Some specs are different (card sizes) since it is UK standards.
Greeting Card Design This volume features a vast array of fun, elegant, simple and imaginative greeting cards designed by internationally-known artists, illustrators and calligraphers. With over 300 full-color photographs of creative, popular, and inspiring greeting card designs, this invaluable sourcebook showcases the very best of what is happening in the industry today. Accompanying text explores the history of the greeting card industry and examines the major contributions from the leading innovative companies.
