The Dirty M Word Part 2: How to use your average item price

Good Morning Class! Did you all complete your homework?

If you didn't, perhaps go back to this post and see how to figure out your average item price.

So let's discuss some questions you may have about how your average item price may/may not affect your sales.

1) How does my average item price affect my sales?

In short, it doesn't. What it does affect, is the type and quantity of work you make. It is merely an means, or production strategy to your end result, or your sales number.


2) My average item price is very low. How do I change it?

There are two ways to raise your average item price. The first is to make more product. This is a double edge sword because you'll have to make much more product. Let's take a look at the example I used last time, where our average item price was $10 and our sales were $1000.

Remember: SALES = Quantity(Average Item Price)

$1000=100(10)

That meant, you would have to sell 100 pairs of earrings with an AIP of $10 to have $1000 in sales. Let's say you adjust your inventory to your next show so your AIP is $20:

100(20)= $2000

Let's look at the ways we can increase our AIP:

a) Make MORE product of a higher price point. While a piece of jewelry that is lower priced may sell easier, you have to make a least twice or more of it to equal the same as selling one piece that  is more expensive.

b) Use more expensive/exclusive materials that can demand a higher price point. If you're producing in a large quantity, you can often buy more expensive materials in bulk without deeply cutting into your profit margin, but the market will dictate a higher price because you've used more costly or precious materials.

c) Check your inventory to make sure it is well rounded. Your average item price could be low because you've overproduced your more inexpensive items and overlooked more expensive items.

3)Should you always try to raise your AIP?

No, it may not always be to your benefit to raise your AIP. As an artist, you should look at all of the shows and sales you make and analyze both the sales, the show, and the type of customers that not only attend but also PURCHASE. If you sell at mostly church bazaars and small local shows, it may not be in your benefit to RAISE your AIP, because those shows may not bear the weight of a higher AIP. In contrast, those types of shows may also not have the SALES or Customers to justify the QUANTITY of a lower AIP.

DO YOU FIND THIS TYPE OF ANALYSIS HELPFUL? 


What questions do you have about SALES that I can help answer???

The Plan

Do you sell your jewelry or beads at shows?  If you do, then you will know what I mean when I say, "What is your plan?" 

I don't know about you, but I agonize over shows.  My plan is usually, simply (ha! never simple!) this.....to have some of everything, in every size, shape and color.

But you know what.......even with a lot of hours, hard work, and determination, I never get there.  Because there is so much more that goes into shows, that the actual making of the jewelry somehow doesn't always get done!  Now, don't get me wrong, I have plenty to sell.  Yet, I always want something new at each show.   I always want to fine tune my display (and to prove it, you can click here to see my displays through the years, and how much they have changed).

 I always need to make a new sign for something.  I always need to run out and get things at the last minute.  And I never get to make all the wonderful things that fill my head, fill my sketch books, & fill my lists.

I think I am learning, that the plan, is simply that, a plan.  It is not the only way, or the way it has to be, but a plan, to guide me along, until I simply run out of time.  I am learning to go with the flow.

So what is your plan for shows?  Do you feel like you never get done all that you want to?