Customer Input. Pricing

[Raining]

Ahh, don't raise prices until I've bought all the knives I want from you! j/k

I like pitdog's idea, too. Basic line and fancier, custom line. :thumbup:

 

[sizzler]

That is a tough question. Pricing is very hard to figure out and depends highly on your situation. I actually went to college for your exact question so it is interesting to me even if I wasn't into knives. This is a very complex issue.

I can't put four years of marketing into a post, but there are some basics to consider:

The number one is to consider elasticity of your product or market. Will raising prices mean less customers? Will the price increase make up for the loss of customers if there is a loss?

Perceived value - at $200+ for a Woodsman right now, would the perceived value increase with the price? Features, options, materials?

Competitors - If you are the same price or more than other custom competitors, why should I buy from you? This is a rhetorical question.

Are the costs in time, labor, materials, and opportunity to produce the product in line with the selling prices? If not, could altering the manufacturing process be a source of savings for you and price holding/reduction?

Are you doing all you can at the moment to maximize your current market at your current prices? Who knows about Fiddleback Forge? Are you easy to find and are you easy to find information about? Is the available information current and accurate? Is ordering a knife easy for the customer? How about a new customer who hasn't spent years on the forum? When one goes to KSF how do they know who Fiddleback is? Knife details, specs, materials, what to expect. There is no product that "sells itself."

Have you optimized your operation to take advantage of economies of scale?

Sheaths. Many knife buyers aren't going to go out and get custom leather like I am. The knife has to come with a usable sheath or it will just piss off the average Joe.

Personally, I love your knives and I want to buy them all. Raise the prices and I will want to buy a few. I will still be a customer and refer others to your work. They are worth it. And that is what most current customers will do. New customers might be a different story. But, it's all math and marketing and you should do what is best for making a profit in your business. Capitalism rules!:thumbup:


TL;DR

 

[sizzler]

Another thought, Micarta isn't viewed by all as a "cheaper" option. If it is less expensive for you to produce handles with Micarta, great! I absolutely love Micarta for its stability. My stabilized maple Woodsman has "stabilized" a little more on one side during a recent cold snap where Micarta would be unfazed.

That could be a way to offer a line of "budget" knives that would sell well!

 

[midnight flyer]

Why not collect data? Track your sales now, track 'em after you raise prices.

That's what I would do as well. In my contracting business, I always have help with setting my prices via my prospective clientele. If I am too high, I lose work. If I am too low, I have a lot of work but don't make the money I should for the effort.

That being said, I don't work any cheaper than I have to, and always try to be competitive. I would rather have a few days of work that yields a bit less money than I think I should have rather than waiting around with no money coming in while for a very well paying job to come. Continuity and cash flow are a couple of the most important factors you can establish when running a business. And business seems to generate more business. The busier I am, the more future business it seems to generate.

Are you paying advertising fees to promote your business? Can you afford to sell for less because you don't advertise? Do you have a staff, or can you afford to sell for less because you have no overhead but yourself? Those things can help you determine your pricing as well. And one edge you have in this market might actually be your pricing since you run a lean operation.

While I don't like to leave a dollar on the table, I am still competitive in my market because I do a lot of the work myself that I generate on the front end as well as the back.

As a sidebar, there is a knife seller (not maker) that I have bought from several times. He is never too high on his pricing, and often he might be lower than anyone else on the net. I asked him about that. He told me his philosophy was that his knives didn't do him one bit of good sitting on the shelf, and since he had rent, staff, wages, etc., to pay every day, he wanted to sell something every day.

He felt like his pricing was a big draw to his products and website.

Just my 0.02.

Robert

 

[Fletcher Knives]

Just remember our conversation when I said, "What the @#$% makes their knives worth that much? If they can get that for their knives, you can get twice that for most of yours."

 

[Fiddleback]

You guys have a lot of good posts here. I will address a few of these points.

First of all, let me say that I'd like to have my knives be available to the average Joe. I want the guy that cuts with his knives using my blades till they are a peg.

Secondly, let me say that I don't have a big head about my skills. There are better makers here at BF, and I feel that the road is all in front of me. But I can see that I'm not at the bottom anymore either.

I did a couple of shows this year, and the consensus from dealers and folks in the business was that I was giving away my work. I didn't really see that, but this week I've been watching what is selling in the exchange, and IMO folks are paying 40% more for horrible looking knives with grinds that are not good. There are knives approaching $300 that have no shape to their handle, no skill in the blade grind, and a fraction of the time I have in each knife. When I look at that, and think of my kids, I really have no choice but to try to get more for my time and my family.

Please remember during this discussion that I am a full time maker, and that the economies for a full time maker are different than for a part time hobbyist. Every year I visit David Manley's table at Blade show because his work is so underpriced that I can't pass them up. But I can't sell my stuff for what he can, because I have goals of earnings, whereas hobyists are trying to pay for the hobby.

I fully agree Andy, they are worth more ( most of them ) than you are currently charging. The problem is that they are already more or less outta my price range and I'd imagine many others are in the same boat.
Maybe you should do a budget line and a high end line.

Budget line, Basic micarta slabs, basic flat grind.

High end line, fancy wood slabs, handle liners,scandi or convex grinds etc.

Just a thought !

Thanks for the vote of confidence bro. I've been trying to make a knife that earned your business in particular since I started grinding. I don't want to price myself out of your range, and this is a major concern for me. But I can't compete with Mora's either. I've gotten, this year, the skills together to make a really efficient working tool. What is that worth.

On the budget line. The material costs in my knives is insignificant for the most part unless I use stabalized or custom handle materials. Belts being the biggest cost. Its the time that is costing me, and most of my time in each knife is in my handle. That shape is filed in by hand, then sanded. Creating a knife with the same handle shape cannot be done quickly. The only option I see for a budget line would be a knife with 1/8 or 1/4" thick scales that are pinned and have rounded over corners. No filing. No contours. Then they'd have to have a bead blasted finish, so no sanding. That could work. And I'm currently working on affording a compressor that could handle the blast cabinet.

Ditto what Pit said. I for one would love to see some bare bones ladyfingers around 100 or 125. I love the looks of your multi-layer handles, but they seem too pricey to use. I had to sell my Nessmuk cause it was too much money into one blade.

Man, that hurts, I consider myself a maker of user knives. The Nessmuk is selling for $150 shipped with a sheath currently. Thats cheaper than Bark Rivers, and those are production. Your business is important to me, and I enjoyed making that knife for you.

Can you please show me an example of a handmade knife that goes for $100 or $125?

By the way Andy, how is my order coming?

Joey

Hey Joey! Thanks for posting. Your knife is not started as of yet actually.

I would have no problem with paying 10% to 15% more.

Thank you CS. Did you get your EDC yet?

In my case, it's a real stretch to buy a Fiddleback. That said, for me I'd want the cheaper line to be equal in functionality ie, same grind, same handle shapes, same fit and finish. Could and would sacrifice in the layered handle/nice wood department to get a lower cost.

See this is what I'm running into with the discount line idea. The time is in the handle shaping. I had offered a discount line for a while, but it was a $ looser because of this handle time.

Check in the exchange for ten minutes and find five knives between $200-300 that are Bushcrafter size, plain micarta, have no handle contours, aren't sexy, and grinds that are thick. Then remember that my Bushcrafter is $160 (without sheath), and it took me multiple hours longer to produce. Mine will work harder without hurting your hand, and the grind is nice and thin and made to cut! (This doesn't even address the convex sabregrind, which isn't being done except by myself and Centerfinger.)

The first time I attended Blade Show, I took one of my knives up to J.Neilson to get feedback. He said he liked the design, but that the grinds were, "impatient." Since then I've been on a quest for thin Neilson-esque grinds. I'm finally getting real performers. Do I have to join the ABS to get paid for that skill?

Andy, have you ever tried to figure out just what you're hourly pay would be on a knife? I'm sure there's a lot more that goes into one knife from inception to shipping than most would think. I know on my sheaths I make probably $4.00 an hour but I enjoy it. You're knives have a much higher threshold as to what people will pay. I feel your knives are a bargain and hope you can keep it that way (at least until I can score one) but I think most people understand that you have to stay profitable enough to make it worth your while to continue your work.
Do what you think you have to do and let the market determine whether you made the right decision or not.

Its not just about the hourly rate, but also about my knives being undervalued when compared to the other knives being sold in the exchange. But if I was getting $4 an hour, my wife would force me to find something else to use to support our family, and she'd be right. Thats fine for a hobby, but the challenge of full time is to earn, not just to enjoy. Part of the problem is that I haven't raised my prices when it ceased hobby status, and became a career.

Your knives are a bargain. They are worth every penny and that would not change at a higher price.

I have handled a lot of knives. Yours are among the best.

Thank you Derrick. This kind of hands on, in the business, experienced opinion is what I need to hear a lot of.

I am very concerned about loosing my WSS customer roots though, and this is a heavy decision for me to make.

You have to charge more bro. I am not sure how you have done it up until now.

TF

Thanks bro. Having you point out a couple of ways I can improve has been very helpful. But my prices are below other makers still doing those same mistakes. I'm up against it now, and to grow, I've got to grow.

I am subject to the current economy as much as anyone else and hate to pay more for anything. That being said, you need to get more for your time and goods. Your prices are low right now and I think it's time for you to pay yourself what your worth.

Much appreciated! You are a good scope, because you are on every damn knife forum I know of, and I know you have seen and held a lot of blades!

 

[mymindisamob]

Much appreciated! You are a good scope, because you are on every damn knife forum I know of, and I know you have seen and held a lot of blades!

I just friend requested you on Facebook too.

 

[TDECK]

Do we lock in on the old prices if we order before the new year? I may have to order another knife or two if so. Why don't you increase your prices every year to at least keep up with inflation. This would be a good start without upsetting your loyal customer following. You have a particular niche and I wouldn't stray from this to far or to fast. I hate the idea of you making a cheap knife, thats not your niche. There are a ton of knife makers that already do this.

 

[orrey45]

I think your knives are beautiful pieces of art and are priced very affordably, so you could raise prices and still retain customers. As for how high I do not know but if you track your actual costs broken down per knife and then look at other makers knives and guess their actual costs then you could get a good idea of the proper markup.

If you raise prices on you main line you could also sell more affordable blades as kits or blades only. Actually if you could come up with a slab-less design it could become a standard for you similiar to Scott Gossman's PSK.

 

[silverbullets]

Andy, I think Pit hit the nail on the head, granted I have yet to hold one of your blades they look top notch (that will change today btw, tracking says it is out for delivery :thumbup anyway take the bushcrafter, keep the base model the same or a little lower but offer upgrades. Martinknives does that, for a base model it is reasonable then maybe another 20.00 for msay multicolor handles and maybe 30.00 more for wood etc, possibly even different steels offered etc. just my opinion

 

[pitdog]

Andy one more thought, have you looked at how Dan Koster has his ordering system sorted ? It must have taken quite a bit of setting up but you first select the blade model then the thickness,blade steel, handle material, blade finish etc and it totals up the cost as you go along ! You could pay say $150 for one of Dans or with premium materials and fixings you could pay $300+ for the same knife but damn it would look nice then.

 

[Fiddleback]

I just raised the funds to pay the web developer, so I will have an order system and internet shopping cart added onto the new website, which will be a wholesale overhaul. Totaly new and finally functional.

I do allow upscaling your options already. But again I've been charging cost, and basically underselling the knives.

 

[Steely_Gunz]

Andy your knives are worth twice what you charge for them. I have never handled as wonderfully crafted blade as my Woodsman. The grind, the fit, the finish, is incredible.

I know you are workin man makin knives for us workin men. However, if you ever did a premium version that pulled out the stops, you could name your price and it would sell...IMHO, of course

 

[hollowdweller]

I think what Sizzler said is pretty much right on.


This is just my opinion and may or may not be true

There seems to be a certain price point where knives sell around here.

The weird part from what I have observed is that the price seems to be the determining factor.

For instance to me a knife with better materials, fit and finish is worth more.

Yet I see people lay out 150 for a knife that is often to my eyes crudely made, and they will pass over a knife that goes for 180 even if twice as much work went into it

If it was me I would be thinking is it better to really make super nice knives and then sell them for a higher price?

Or is it better to make budget knives and make and sell more to make the same amount of money??

I think I first got on the net and checking out knives around 1999 and in that time it seems like the overall price for customs has taken a dive, not because of the economy making people buy less but because the economy has put way more knifemakers into the picture. At the same time the net has put more buyers into the picture but they don't always know quality.

I think the key would be to market to the people who do know quality and will pay more for it. That market will probably stat the same as the others ebb and flow.

 

[WA Martin]

You have to raise your prices but you have to educate your customers too.

I don't know exactly how but your answer to those who say, "Why should I pay that price?" are going to have to understand about your handles.

I guess I'm gonna prove my ignorance here but you recently posted a photo of a Hunter (?, 10.5" OAL). It looks really good. When I started reading this thread I said to myself, "Yeah, I can see needing to pay $250 to $275 for that handle because its so gorgeous, it had to cost Andy more in materials. But I hope his mircata stays at $200." Forgive me if I've totally screwed up your pricing structures but you get my drift I'm sure.

I would not have known that there was no discernable difference in materials prices between mircata, G-10, or stabilized wood in the handle for your knife. I see nice wood and I presume more expensive. I see G-10 and I presume more expensive. I see wood-on-wood and I assume more expensive. I see a one piece mircata handle and think - less expensive. My mind doesn't register contours = more manhours. I wonder if it registers with anyone who doesn't actually turn out a hand-made anything.

I'm still waiting for Jason to finish the sheaths on my knives so I haven't held them yet. But I'm sure that after I do that I'll see where they were worth more than I paid for them and if the price on the ones I don't have yet goes up, I'll be saying, "yep, that's worth it!"

 

[Fiddleback]

I would not have known that there was no discernable difference in materials prices between mircata, G-10, or stabilized wood in the handle for your knife. I see nice wood and I presume more expensive. I see G-10 and I presume more expensive. I see wood-on-wood and I assume more expensive. I see a one piece mircata handle and think - less expensive. My mind doesn't register contours = more manhours. I wonder if it registers with anyone who doesn't actually turn out a hand-made anything.

My knives definitely come alive in the hand. Stabalized wood and custom phenolics are descernably different in price, but they aren't currently covered in the price of the knife.

Any increase will be modest as its not the time for excess to be sure.

 

[eisman]

If you're selling everything you make and are not making money you need to raise your price.
If you're selling most of what you make and breaking even you need to expand your market.

 

[Raining]

You have to raise your prices but you have to educate your customers too.

I have to agree wholeheartedly with this statement. In my experience, consumers will pay any asking price - as long as their perceived value of the product justifies the cost.

The more I know about your knives and the time and effort given to each one, the more likely I will pay your price - the higher the price, the more information I need.

Before making my first order from you, I had to do my research. The bulk of my knowledge came from this forum and from the WSS forum where people USE your knives and review them.

The average person who is not an obsessed knife knut will likely only read what is listed on the KSF descriptions and/or your website and therefore may miss out on a lot of information learned here. For example, I love your hand contoured handles, but I don't really have a good comprehension of what goes into it.

So, here are some suggestions for your web site for starters:

1. Emphasize the fact that your knives are meticulously handmade.
2. Show photos depicting the process of creating your art. Photos will be much more powerful than anything else you can say!
3. Educate us on the different steels and handle materials that you use. What are the benefits or downsides of each? What tends to cost more and why?
4. Have a section on basic knife care. How should I care for my FF knife that I just paid so much for? How to I treat wood handles? How to I prevent rust?
5. How about a bio section? I would like to know more about you, how you got into this career, basically, find out about your PASSION for making knives.
6. Reviews and customer feedback! Having the woodsmonkey reviews and/or other customer comments, stories, etc. are very powerful.
7. User photos! Ask your customers to send photos of themselves using your knives and post them on your site.
8. Many, many, many product photos and examples. Seeing many types of handles, grinds, finishes, etc. can be inspirational to those seeking customs.
9. Have a FAQ section for all those questions you get asked over and over.

I realize a lot of my suggestions already exist in some way, shape or form, but unfortunately they are not all in one place. I only focused on your web site because it's probably the easiest way to educate, and therefore, reach your customers.

Also, I realize that there is time and cost involved in all of this - good, solid marketing will pay for itself many, many times over.

 

[CarpScot]

Thank you CS. Did you get your EDC yet?

I just picked it up. What a beauty. More importantly, it is a very well executed and functional design.

When I said 10% to 15% earlier I was referring to the micarta handled knives of yours that I have. Now that I've held one of your wooden handles I can say that I wouldn't have any qualms about paying an extra $50 bucks for one. :thumbup:

 

[Shotgun]

The problem is that it's a real stretch for me to afford your cheaper knives which is why I haven't bought one, YET. That being said I'm going to shoot myself in the foot.

I think your knives are worth more than Busse's and Striders and they're twice to three times the price. You can definitely charge more for your work.