Custom knife prices

Les,
Canadian is not as socialist a country as it once was and capitalism is more firmly entrenched here now as it ever was. There is no level playing field here- it's a matter of survival based on having a sound plan, and maintaining a competitive edge, just like in the States.

Please feel welcome to peruse my website, www.sookebikes.com. I'm not sure why you'd sense that my business is slow going, or that I feel that like businesses should be forced to play 'on the level', but I have been steadily taking market share, in my community and beyond, from the big boxes and from larger more established bicycle stores in my region. I don't do this by discounting, but by providing excellent service, fair prices, a diversity of product and keeping my finger on the pulse of what's going on. Not to mention- STAYING IN BUSINESS. I spend VERY little on promotion.

I support a mortgage, my wife and our child on my income in this business, and have done so for getting close to five years. We don't live extravagantly by any means, but we are comfortable. There has been dramatic growth in my business since I took it over in March 2004. I have doubled my bicycle sales during that time, and quadrupled my parts/accessory/clothing sales as well. I have made mostly good decisions, and a few bad ones. I learned more from the few bad ones than I did from the many good ones:thumbup:

I have two other businesses, one of which will launch me into the cutlery industry and will likely cut into your Canadian sales down the road:p.

I don't presume to know much about running any other business than the one I have been running, and my training in this industry basically includes technician certification and over 15 years of experience, no schooling whatsoever in business. I am a c-hair short of a university visual arts degree, and as we all know, artists generally make lousy business people;). That's the caveat, so don't follow my advice if that information makes you nervous;)

I only hope that my posts here provide makers, primarily, with a few nuggets of wisdom I've gained in my time growing my own business 3 fold in about 5 years. This thread has nothing to do with me, so I'm not sure why the need to find out about where I'm at. But, you asked, Les. So there you go:)

Every knife maker I've dealt with, I've had a desire to see succeed. That is where I'm coming from.
 
My 2 cents:

- Some customs are overpriced.
- Most customs however have a very fair price seeing the amount of work that went in them.

Actually I think it's a very fine line between underpriced/overpriced. If a maker's knives are underpriced, maybe he will sell a lot, but will not earn enough compared to the amount of work he puts in it. If a maker "overprices" his knives, he will not sell a lot and end up in the same situation. If the price is right, than collectors will buy and the maker will make a fair amount of money.

Another thought: since I've started buying and ordering custom knives, I started to realize that most high-end factory knives are way overpriced. (which doesn't mean I don't like high end factory knives!)

Kind regards,

Jos
 
I'll pay more attention to this thread when someone decides to give away a FREEbie!

.that's what i'm talkin about.

(on strike.)
David
 
I guess its how you look at it... Some people make knives for a living, you would want to get a bang for your buck
 
I have tried to make a few knives in my life, and none have turned out well. One thing I know for sure though, I never got a good idea of why custom knives are a good value from my attempts at making them. What really got me to thinking that even the more expensive knives are not usually overpriced is watching the top makers and seeing what they put into those knives. In my opinion, every knife collector should take the time to find out what goes into making top quality knives. I would be willint to bet that they would come away with a whole new understanding for the prices they see. I know I did.

Lorien, I doubt very much that there are many makers that are gouging their customers. There are many that charge more for their knives than I would be willing to pay. That just means that I am not appreciative of what it is that they have to offer. Other people may well feel that these makers knives offer great value.

I also don't believe that knives should be priced based on a set bunch of parameters. There are too many variables that need to be taken into account. One make may take twenty hours to make a knife. Another may take ten hours to make a similar knife. Should the second maker charge less for the knife, because he is more efficient? Or should he use his higher efficiency as a way to earn more and make a better living?
 
What about rock star pricing? Does that usually come from the maker or the aftermarket?
For example, an Emerson custom made liner lock with 154cm, Ti liners and bolsters, stainless fasteners and micarta scales might cost twice as much as a virtually identical knife from another well known maker with fit and finish on par or better.
I know that the term market position will come up, but what's that about? Is it speculative investing on the assumption that the rock star maker's work will always be more valuable than a similarly constructed knife? Is this short term speculation, or long term?
There is a lot that I don't know about collecting things, because I don't really do it per se. I don't know a lot about investing either.
 
What about rock star pricing? Does that usually come from the maker or the aftermarket?
For example, an Emerson custom made liner lock with 154cm, Ti liners and bolsters, stainless fasteners and micarta scales might cost twice as much as a virtually identical knife from another well known maker with fit and finish on par or better.
I know that the term market position will come up, but what's that about? Is it speculative investing on the assumption that the rock star maker's work will always be more valuable than a similarly constructed knife? Is this short term speculation, or long term?
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Probably has nothing to do with "speculation" for most buyers, since they don't intend to resell the knife. It has to do with Fame and Exclusivity, like why does a Van Gogh cost more than Joe Painter's artwork, even though Joe's painting is larger and more life-like?

Custom-made knives are priced like artwork, not billed at a standardized book rate like car repairs...
 
rio said:
you get what you pay for , golden rule in my experience with life, how can you put a price in love and passion that is what this knives are worth, craftsmanship has no price but yes we do need money so that is the monatery price, buyers love knives , makers love making them everybody wins , when things get commercialize that is when people in both sides loose , one the buyer likes the knife but feels rip off cause it was made with no love , the maker feels crappy cause his work wich he loves has been now label with a price, this is not about money first is about quality and if you value the quality you see in anothers work well the price should not be the first thing, is a big turn off when a maker is under pressure to make knives and he is so late you don't want the knife any more, the buyer forgot why he oder that knife , all this is what money does , we forget the impression the knife made on us or the hard hours somebody put into them, well if you like it is for a reason , before you pay for it don't forget that reason, and makers don't forget the love for your work no matter what others say.
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Wow, impressive pile of BS here.
 
Lorien said:
...a businessperson needs to know what their costs are in order make a profit to put food on the table.
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Businesspeople do need to understand their costs, but not to plan their profit, simply to not go under. Most businesspeople I know have much more ambitious profit goals than simply putting food on the table. If they could sell at a 99% profit, they would - that would give them not only food on the table, but paying for the kids' college, maybe a second home, maybe a fun car for the w-e, etc. Why should knife makers not strive to make as much money as they can? If they can maintain a business with a 25%, a 50%, or more margin, more power to them. This is what capitalism is all about.

As a side note, I wonder which type of makers have the highest margins
 
xuesheng said:
Very few custom makers are rich. The vast majority are honest, hard working folks who have a passion for what they do.
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Not that those two are incompatible. Most rich people are precisely that - honest, hard working folks (they're also smart and lucky).
 
I don't think custom knives are over priced at all. My big weakness is custom slipjoints. I usually pay between $750 and $1100 for each knife I own. I've sat down and tried to figure what an average custom slipjoint maker makes a year after all his overhead and by my figures it's kind of scary. They must absolutely enjoy doing it because they don't do it for the money. There are other makers out there that make slipjoints and charge twice the money I pay for a knife but it doesn't seem like they make near as many per year.

What I don't understand is how do these guys get a start? A new maker may get 1/3 as much for the same knife I pay $750 for and I don't know how they manage to stay afloat until they are a sought after commdity like some of the bigger names.

My hat is off to all the custom makers out there.

Now if I can just get the courage to gather the funds for a Reese or Jess Horn knife or two my collection will be complete...or will it???
 
I usually find a lot of wisdom crammed into very few words when I read his posts. Leave people alone, leave markets alone and unregulated, keep government out of private lives and it'll all work out one way or another. Just sit back and watch and learn. Freedom and capitalism made this country great in a very short period of time. Unfortunately, we are now losing sight of that.

Pete
 
Lorien,

I am asking the questions I have because of your flip flopping (you are related to the Haughty John Kerry..Who served in Vietnam, are you) :D

All the regulation you speak of does smack of socialism, which is the confusing part.

Im glad to hear that your business is thriving, good for you. The part about "Survival" leads me to believe you would like things to be a little easier (normal human reaction especially when your family is involved). A little easier would involve a "level playing field".

I agree with AV8R, leave regulation/government out of it. Let the markets run themselves. The custom knife market is in a constant stat of flux...more so than fluid. Trends seem to start quicker and more often...then die out quicker and more often.

As for your new business cutting into my knife sales...I hope you understand that this is not the first time I have heard this. Good luck with that. LOL
 
Les,
your posts are getting a little too personal and abrasive for my liking, and I've said about all I need to say on this topic, so I'm going to bow out of this one.
 
after rereading all my posts, I can see clearly how it may seem that I am advocating formal regulation, which I do not personally believe is required at all, even though there are things like the ABS which allows for a certain amount of regulation already.

What I meant to say, simply, is that there are ways a knifemaker can find out for themselves whether they are charging a fair price and receiving their expected renumeration, and that there are ways that a buyer can pinpoint whether the value of the knife is there or not. I tried to outline some of these ways in my first post.

I believe there is no yes or no answer as to whether custom knives are overpriced or not. It's a pretty vague and general question. I think that some of them are, and some of them aren't- not a black and white answer, but it's the best I can come up with, as that answer depends on the individual buying the knife, and the individual selling the knife.

I'm not saying that all the methods I wrote down, for an individual maker's pricing structure, should be institutionalized, only that they bear consideration -by the individual who runs their own business and for their own purposes-
 
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At various points in time I run into someone who questions why pattern welded knives are so expensive. At some point I got tired of giving lengthly explanations and just wrapped up some strips of 15N20 and 1084 in wire and put an index card in front reading;"Damascus starter kit, do it yourself". Many chuckeld and most got the point.
I believe you can put any price you want on a finished piece, hell it can look like a telephone number in europe. You will get that price, If the work clearly supports the numbers. If the work clearly does not, you will be looked at as one completely out of his mind. In my experience, most folks these days don't know anyonewho can make something from scratch by hand, even a cake! So there is very little to refer to in terms of what kind of effort is involved in producing a high quality hand made artifact. But I can see that we're all doing our parts to inform and educate.
 
As a side note, I wonder which type of makers have the highest margins[/QUOTE]

Most likely the ones with highest living costs.
 
Lorien,

Your posts got personal the second you wrote that dealers should have their profit potential regulated. Did I get personal with you, yes. Was I abrasive, no. If you knew me, you would know that. The question is "Who are you or anyone to tell anybody what they can sell and how much they can make?"

Stepping back to look at your posts you finally realize what you were saying. Even with all that you still think there should be some "consideration" for regulations.

Those who don't have or represent those who don't have....always want to regulate those that do have. Why, because it is easier to legislate than it is to get out there and work your ass off.

I take it you didn't address my question about regulating collectors who make obscene profits on the knives they sell. I suspect this is because you are a collector and do not want anyone telling you how much profit you can make on a knife.
 
I read this thread after I put it off as long as I could. I spent 30 years in the highly regulated telecommunications industry and regulation is not something I would wish on my worst enemy. It had its place at one point in time, but not now. Both the ABS and Knifemakers Guild have knife review policies for members and levels that reflect the ability of the maker. The Guild also has practices that help ensure ethical treatment of customers and I would guess that the ABS does too. They are both voluntary. That is the way they should be, and about as much regulation as we need.

When people start talking about pricing knives and how it should be done, they are getting into the business of the person selling the knife, either the maker or purveyor. If the maker asks for help, that's the time to offer. If you think prices are too high for the quality or his reputation, the market will likely take care of that, one way or the other. The mark up one gets for his product is only the business of that person. If someone can purchase a knife and turn it for a quick profit, more power to him. If he can turn it for an "obscene" profit, that's ok too. His business, not mine.

One thing that has amazed me since I started making knives is the number of people that will ask if I am making enough money building knives to make a living. This is from people I don't even know as well as good friends. I would not ask anyone that of their profession and have no idea why they feel comfortable asking that of mine. The answers are getting shorter and more to the point. My business, not his. :D
 
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