Customs Pricing – Opinions and Views?

Hi WWG,

I wasn't speaking about any dealer(s) in particular. Note in my post I carefully qualified my "generalization" as "most of the online dealers I've seen".

Actually I have yet to purchase a custom from a dealer. All of my custom knife purchases/trades/etc have been through private transactions or with the maker directly. I have some atypical requirements so the odds of finding a knife that meets my desires/needs in a dealer's inventory are pretty slim.

As for languishing knives...some possibly are on consignment. Others assuredly are not. :D
 
Hi Blue,

So you have never dealt with a dealer. Yet you carefully "generalize" about "Most" Online dealers. Exactly what percentage is "Most"??

Would that be 75%, 80%? What generally do feel would be an appropriate percentage to go along with your comment?

As for knives languishing on dealers sites. Some belong to dealers others assuredly do not :D

Just trying to eliminate generalizations. Its always best to speak with clear cut examples in lieu of generalizations.

WWG
 
Hi Druwood:

You wrote:

Slightly out of context, but... I think a maker has to price his knives very very carefully. IF his table price is the same as most dealer prices...I'm immediately suspicious of how desirable that maker's work really is.
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Most of the knives I sell are at the makers price. The majority of these makers knives are very desirable. Most of the makers I work with have extended waiting periods.

So why would a maker and their business partner, the dealer, selling a knife for the same price make you suspicious as to how desirable the makers work is.

Would you be less suspicious of the makers desirability if you paid a 30% premium? If you did pay that premium, how would you feel if you sold the knife and took a loss in the after market?

Are you suspicious of the car you buy when the dealer sells it for less than the maker?

Would you feel more or less suspicious if the dealer sold the knife for less than the maker charges?

WWG
 
WWG...I know you and every other dealer can't stop using a word [ "MAKER..."RETAIL"..."LIST" ] before the word "PRICE"...it's too engrained in the BS...the ones who get the raw end in this silly system is mainly the MAKERS...
 
WoodWorkGhost said:
So you have never dealt with a dealer. Yet you carefully "generalize" about "Most" Online dealers.
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I fail to see how having never dealt with a dealer impairs my ability to read prices listed on the web for "in stock" items. :confused:

I'm not going to list specific dealers. However I would say that we're looking at least in the 60% range.

Don't worry, you're in the minority. :D :thumbup:
 
I think I have been semi brain dead for the last few months in that it took me this long to figure out who WWG was.....lol. So Les....what is a fair price for someone like me to ask for a basic ABS 101 hunter and bowie, assuming that I can knock out a few more reasonably decent knives?:D Two years doing the forging thing part time but rampong it up recently, fit an finish finally coming up to reasonable levels, using good materials but strictly hardwoods for handles at this point. and someone elses nice sheaths.
 
Hi JDM,

Without seeing the knives. Assuming you are going to use stainless fittings and include a sheath. You're not a JS. So basically $175 for a Hunter and $300 for a Bowie with a sheath. This would be with a good fit and finish.

Obviously Ironwood or Stag would add some more to the price.

That will be $25.

WWG
 
As I said, the dealers are selling knives in spite of the prices they are asking or they would not stay in business.
If in fact there are knives on their sites that have gone unsold for a year or years for that matter who are they hurting but themsleves?

The makers have been paid for these knives that are setting unsold.
And collectors do not have to buy them if they are too high.

The only one who may be at a disadvantage is the new inexperenced collector as his only option may be buying overpriced (if in fact they are) knives from the dealer as he probably won't spend the hundreds of dollars to attend shows or does not have the contacts to buy direct from makers.

As far as collector to dealer consignments go, the dealer sets the price usually after consulting with the maker. The collector either agrees with the consignment price or goes elsewhere. Most dealers will not accept a knife into consignment unless its in "as new" condition.
 
Hi Suspme,

Your right I have to deal in the business end of custom knives. So I have to use those nasty words (they actually used those very words over and over again in graduate school when I was getting my MBA). Kinda like, Location, Location, Location.

You wrote:

the ones who get the raw end in this silly system is mainly the MAKERS...
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WOW. I think if you got makers to the side most would tell you the money is just an added bonus for something they would do for free.

You know you're looking at the wrong group of people in the equation.

It is those pesky collectors who keep asking....How Much? If only they would stop that. The makes wouldn't have to price their knives. :D

WWG
 
Look Here Kevin,

If you are going to start using common business sense you will be banned from this thread.

Dealers aren't supposed to make a living wage. They are to set up at shows, carry lots of inventory so collectors can handle knives they may never see from the actual maker, keep up web sites. Answer thousands and thousands of questions year in and year out. Judge, do seminars, write books, write articles,e etc.

And be Damn glad if they make a dime on every knife.

Sheesh!

WWG
President "Quick Nickle/Slow Dime" Custom Knives.
 
WoodWorkGhost said:
Hi JDM,

Without seeing the knives. Assuming you are going to use stainless fittings and include a sheath. You're not a JS. So basically $175 for a Hunter and $300 for a Bowie with a sheath. This would be with a good fit and finish.

Obviously Ironwood or Stag would add some more to the price.

That will be $25.

WWG
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Thanks......I didn't get the memo on stainless until very recently...lol. I got $150 for a 1075/stainless/walnut hunter with sheath and $160 for a mid sized W2/blued 1018/walnut bowie with no sheath on British Blades. They both had small issues, so that was fair and the buyers are quite happy.....ESPECIALLY the guy who got the bowie, I suspect....lol. Is amboyna considered a premium upgrade like ironwood? My biggest source of pain is that I don't make my own shaths and have been using the ready made Treestump ones for my hunters. They are beautiful, but a tad pricey for someone selling in my price range. The funny partis that I can get sheaths for the big knives for the same or less from Sullivans as long as i keep them in the size envelope of an of the Randalls. Not as fancy as the Treestups, but rather servicable.
 
• How often should makers raise their prices? Once a year? Every two years?

Makers should raise their prices as often as it is appropriate. This can be due to cost increases, or it can because of increased demand. I don't think increasing price based on becoming a better knifemaker is a good idea unless there is a demand for the makers knives. You can become a better knifemaker, but if you are having trouble selling at their current prices, increasing the price isn't going to help.

• Do you view it as positive or negative when a maker you support by collecting his knives raises his prices?

It depends. I never object to makers raising their prices if there are good reasons to do so. Increased costs, increased demand and too long of a backlog are all good reasons to increase price. Another good reason is that the makers knives are underpriced. I believe it should be done gradually, rather than in one big increase.

• How about if he lowers his prices?

It would depend on why. If it was due to a waning demand then it would cause me great concern. If it was due to increased productivity, that wouldn't be a bother to me. Makers' prices going up can be a good thing for resale value, but only if there is someone that wants that maker's knives.

• How do you feel about makers discounting to dealers?

I have absolutely no problem with it, as long as the maker is actually discounting to the dealer. Let me explain that comment. I once read a comment by a maker that he figured out what price he wanted to get for a knife and that is what he sold it to the dealer for. He would then add the amount he would discount to the dealer to come up with his price to a collector. If he wanted to get $300.00 for a knife, he would sell it to a dealer for $300.00. If he gave a 20% discount to dealers he would set the price he sold directly to a customer for at $375.00. I didn't care much for that pricing strategy.

• What % is acceptable for a single increase?

Price increase should be reasonable. I hate it when I see a maker get his MS and then increase his price by 50%. His knives are no better the day after he got his MS than they were the day before. Some makers get hot and raise their prices a lot. What happens if/when they aren't the hot maker any more? They are forced to either drop their prices, or to find another way to make a living.

• What is an acceptable mark-up for a maker? A dealer?

I think a maker should be able to mark up all his material costs. How much depends on the material. Materials that tend to break quite often when being worked need to be marked up more than ones that don't. Ivory has to have a higher markup than Micarta.

A dealer should try to keep prices as close to the maker's as possible. That means his/her markup should be based on the discount that can be negotiated with the maker. Sometimes makers have to charge more than the maker's price, because the maker doesn't give a discount, or gives a very low one. Dealers can have very high business costs, and I feel that they are entitled to a fair profit.
 
well there is a knifemaker here who had excellent prices then all of sudden prices jumped 150 dollars , and i was like wtf??? lol and i know prices of materials did not jump that much , he is a good knifemaker in folder section . no names . i just foudn it weird for months and months prices were about the same then bam bigtime mark up . but i think the knives were underpriced to start with by alittle but there should not be a big jump all of a sudden.

im not bitching to bad because if i really wanted one i would get one , but seeing the old prices to new prices not worth it to me to pay the markup . it is all supply and demand . i have no problem with any knife maker asking any price for a blade because i have no obligation to buy it ,and somewhere out there someone will pay it.
 
lwrhea said:
I have two points that are related but am not exactly covering all of the points. I have no doubt they will be:D .

First: Dealers sometime get bashed for a variety of reasons, but they are the single best source of advice and accurate (as opposed to stroking egos) information when it comes to esablishing the maker's position in the market and pricing.

Second: About "mark ups". I dont consider any part of the knife's price a mark up. It's the price. The dealer should have the same price for a maker's knife as the maker. The dealer get a discount for services provided. If the dealer does not offer services (exposing the maker's work to other areas of the country, etc) there is not much point to work with a dealer. That being said, some dealers go above and beyond, which is good for everyone.

Lin:)
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Good points Lin.
Do any makers have any pricing philosophies you want to share?

Do you find it better to have modest prices increases at regular intravals (say yearly to cover inflation) or just as market position and/or market conditions dictates?

Lin makes a good point in that if dealers are providing you a service they should receive a discount. Do you agree?

How many of you work with dealers? Multiple dealers?
 
Kevin,
Only in the last couple of years could I fully appreciate the prices of Custom Knives which once seemed so high. Thats coming from a guy who always had knives, but rarely bought anything but productions.

This past Blade show is a good example of what has changed my thinking. I took 6 knives and sold them all at an average of about $700. Lets just round it to $4000. After Hotel, meals, travel expenses, restock some(not all by any means) material, etc. there not as much left as some would think. It's kind of a "break even" proposition.

This not to complain at all. I'm one of the fortunate ones that could pay for their trip. But it helps me to appreciate that on average a lot of makers surely arent having their expenses covered. That pulls them to one of two directions, either stop coming to shows to cut expenses(thats not good for anyone), or increase the price per knife in the hopes of covering expenses with fewer sales. All of this is assuming the quality is up to parr. If its not, thats another can of worms.

I did have a price increase of 10% and will try to use the Blade Show as the marker for each additional price increase. I think a large, sudden increase is not good. Value pricing per market position.
Lin
 
I see you guys were up late.:)

After 4 years of full time knife making and saturating my local market, I did my first show in St.Louis, 94 or 95. I sold around 30 knives and pretty fast, folders for between $75 to $125 and fixed blades, large and small for well under $100. Sold a good number to dealers.:eek: Pissed off some of the local makers, said my prices were way too low.

I did a lot of shows in the next few years and slowly raised my prices as my quality went up. I also started working with dealers who did far more shows than I. These dealers really helped put my name on the map and put my knives in front of buyers who would not have had a chance to see them. Talked me up in the mags also. This was all pre-internet. Quite a few collectors are still not on the internet.

As I started making higher end folders and autos, a couple of the dealers really inflated my prices. This was beyond my control and against my wishes. I got out of this situation before it was too late. I also got burned out on the really high-end stuff and moved on to bigger and better things.

I started advertising in 2000 and haven't looked back since. My total over head is running around 50% on my gross. Yes Les, I'm into the business end also :) and I do keep a close eye on the secondary market.

I raise my prices around 5-10% per year but feel my knives are that much better each year.

I still work with a few dealers but very limited. I have too many orders, more than ever and find it very difficult to make for shows, orders and dealers too. The years are getting shorter and months go by faster. But I would rather not be doing anything else:D

Threads like this are one of the reasons that I like Blade Forums. You won't see this stuff on the other knife forums. Except maybe 'The Anvil'.

Thanks for starting this Kevin.
 
Lin, well said as always.

As collectors we need to realize that makers and dealers are operating businesses with real expense. Not just supporting our pleasures.

And makers need to make a profit as knifemaking is a HARD trade. We don't work at our jobs for free, nor should makers and dealers.

Full time makers depend heavily on this income. Part time makers don't as much, however working a full time job and having to fill orders on nights and weekends has to be tough.

Even the makers whose market position allow them to get ten times Lin's $700 have worked their asses off and suffer with pain daily in getting to this point.

Until you start working your trade for free, STOP WHINNING about customs prices and greedy dealers. ;)
 
Lin, Don,
A 5-10% yearly increase probably just covers yearly inflation, and why not give yourself an hourly raise each year as you gain more experience. Most employers give their employees raises for performance and cost of living increases. But, somewhere in time, it levels off, it can't keep going up exponentially. The typical sigmoid growth curve ("S" shpaed curve).

Pricing is tough, I guess as long as folks are willing to pay what you are asking, then most likely the prices are reasonable.
Bob
 
Don Hanson III said:
I see you guys were up late.:)

After 4 years of full time knife making and saturating my local market, I did my first show in St.Louis, 94 or 95. I sold around 30 knives and pretty fast, folders for between $75 to $125 and fixed blades, large and small for well under $100. Sold a good number to dealers.:eek: Pissed off some of the local makers, said my prices were way too low.

I did a lot of shows in the next few years and slowly raised my prices as my quality went up. I also started working with dealers who did far more shows than I. These dealers really helped put my name on the map and put my knives in front of buyers who would not have had a chance to see them. Talked me up in the mags also. This was all pre-internet. Quite a few collectors are still not on the internet.

As I started making higher end folders and autos, a couple of the dealers really inflated my prices. This was beyond my control and against my wishes. I got out of this situation before it was too late. I also got burned out on the really high-end stuff and moved on to bigger and better things.

I started advertising in 2000 and haven't looked back since. My total over head is running around 50% on my gross. Yes Les, I'm into the business end also :) and I do keep a close eye on the secondary market.

I raise my prices around 5-10% per year but feel my knives are that much better each year.

I still work with a few dealers but very limited. I have too many orders, more than ever and find it very difficult to make for shows, orders and dealers too. The years are getting shorter and months go by faster. But I would rather not be doing anything else:D

Threads like this are one of the reasons that I like Blade Forums. You won't see this stuff on the other knife forums. Except maybe 'The Anvil'.

Thanks for starting this Kevin.
Click to expand...

Great stuff Don. Now we are going in the right direction. :thumbup:

Makers? :confused:
 
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