Changing prices with the economy?

Wolf Creek Forge

Wolf Creek Forge

Joined
Jul 4, 2012
Messages
533
I am originally a business major..I was taught to change your business with the economy..Does anyone else change thier business plan/prices/offerings to better suit the ecnonomy as it is? Just curious, thanks
 
I'm curious about this too, I see sometimes makers dropping their prices. I'm curious at what point the profit margin becomes so low guys just have to leave the grinders off till the market picks up again? My wife and I have commented many times that the economy doesn't seem that bad on the ground if the restaurants are still packed, then last night went to dinner (we're down to 2-4 times a month as a family) and the place was half empty. hnmmmmm....

Red
 
Special prices and deals are there to get people in the door. But that can't go on forever. No profit - no business !!
 
In my line of work I often offer lower prIcing to
Get people inside. I do it maybe once a month
On my slowest day (Friday).
 
If operating costs haven't gone down, then lowering your prices is a stop gap at best, and sustaining those reduced prices for a long period will put your business in the red. If this is not true, then the original prices were inflated. Period.
An exception to this is an individual knife that hasn't sold at regular price, a maker can and sometimes may have to take a hit on that piece in order to get his costs back for materials and consumables. No professional maker in his right mind should start work on a knife, knowing that he will not be able to sell it at a price that covers his costs and labor.
 
Lowering prices on already existing models and or work is not sustainable with the thin profit margin most makers have. There are too many fixed costs in this business that continue to rise.... HOWEVER, what I do, and I think alot of other full time makers do the same, is build some lesser expensive knives. These are knives that dont have as much initial cost and take less time to build, they can be sold at a lower price point while still keeping your profit/time margine in check.

I have actually gone UP on my hand polished/hamon work, while maintaininig a considerably lower price point on the belt finished/simpler work.
 
I have also shifted gears away from making as many high end knives in favor of basic ones that I can quickly grind out. A customer will buy one or two cheaper knives and then come back and place an order for something more pricy later. Some of these people become repeat customers and bring in their other knives for sharpening and repairs. These people will bring in friends who will place orders which helps keep things moving forward.
 
This is what I was really talking about..Changing your plan and offerings..Such as making more lower priced items that sell when the higher end stuff slows down..Not so much dropping already set prices..
 
I can totally appreciate that approach. I might be able to afford a knife that has a belt finish and no hamon but not he pricier hand polished one with hamon. I think the way this economy is going there definitely has to be a game plan. I was just curious what some would do if it got really bad and stuff isn't selling, just turn off the grinder or only offer the less time intense knives.

Red
 
I have been running a buddys bar restaurant ,golf course ,for the last 2 months, We had to get rid of the manager.
But yes, dropped the golf fees and are running specials to go with the times. Food costs and beer also..
I am finding that the supply people have adjusted theres as well.. You go with the flow.
Times have been hard on smalls in this area.. As well the working people..
As a knife maker also at times your working for nothing but fun.. You bargin shop your materials ,. Never give up quality......
 
RMLamey said:
Lowering prices on already existing models and or work is not sustainable with the thin profit margin most makers have. There are too many fixed costs in this business that continue to rise.... HOWEVER, what I do, and I think alot of other full time makers do the same, is build some lesser expensive knives. These are knives that dont have as much initial cost and take less time to build, they can be sold at a lower price point while still keeping your profit/time margine in check.

I have actually gone UP on my hand polished/hamon work, while maintaininig a considerably lower price point on the belt finished/simpler work.
Click to expand...

Ditto... Great post Matt!!! :thumbup:
 
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