Strictly a money question

Shing

Shing

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If you want to make the most money from knifemaking, is it more profitable to make a large number of decent quality plain knives or a smaller number of better quality better finished knives?
 
Not to be flippant, but the best way to make the most money in knifemaking is to make a lot of knifes that your customer base will buy.

If you are an unknown, that may well be many low price but good quality knives. If you are a famous maker, it may be two or three high grade collectible knives a year.
 
bladsmth said:
Not to be flippant, but the best way to make the most money in knifemaking is to make a lot of knifes that your customer base will buy.

If you are an unknown, that may well be many low price but good quality knives. If you are a famous maker, it may be two or three high grade collectible knives a year.
Click to expand...

Stacey, I have attended two ABS hammer ins. After hearing the mastersmiths talk about money, I have the impression that alot of them are not making alot of money. It seems to me the knifemakers who are doing "ok" are the ones who do turn alot of volume.

The economics of knifemaking are still a bit vauge to me. :o
 
I think Stacy, as always, is right. If you're new and try to put out a knife, no matter how nice, for $1000+, it just isn't going to sell. Now, if you take it to a show or otherwise get it in front of a lot of people you might sell it but not via the net where they can't physically put hands on it and see it up close with their own eyes.

On the other hand, if you put out more simple and basic designs but of good quality and charge a low enough price people don't mind taking a chance on an unknown maker then you start building that reputation for good quality AND a base of customers who know your work. Over time you can increase your price even for the same quality knife until you see what the market will bear. At that point you have to find ways to improve our income by either increasing the market value of your work or increasing your productivity, or both.

It probably takes me as much time to make one of my basic knives as it does for Stacy to produce one of his much higher quality pieces. I work more slowly due to errors or uncertainty and to a minor extent my limited equipment. So for the same time invested, and probably not so very different materials cost, he is going to make far more money.

On the other hand, so far I've managed to sell about as fast as I can make them, I don't have finished knives around that I am trying to move. I also haven't gotten any angry emails or phone calls from buyers saying they were unhappy. A few sent me nice comments and feedback. I try to make every knife a little better than the last and it seems to be working. I won't say I'm making a lot of money, but it's a self supporting hobby at this point.
 
Before anyone gets a wrong impression........
I have a great day job that supports my knife making habit - I am a custom Goldsmith.

Of the many makers I know and have talked with, most don't break even, much less make a profit. When it comes to making a living, the number drops to a few dozen....and most of those have a wife who has a good job with family benefits.

Of the knifes I sell, the plain fillet and kitchen knives make money, the high end and art pieces are hard to sell ( unless it is a custom order), and those have a low profit margin when the expensive materials and amount of time are figured in.
A point in case is this Christmas season. I sold three dozen oyster knives, 20 fillet knives, and 10 professional cutlery pieces ( plus some assorted items). The total was about what I can get for a sword or a high end custom knife. It probably took less time to make those 66+ pieces than one sword/custom would, but the materials cost would be a bit more.....so from that perspective it would be a push. The biggest plus is that I made 66+ sales, not one.

Very few makers, even some of the well known ones, make more than an assistant manager at McDonald's does. Many don't make as much as the counter gals.

I think for a new maker, the smartest thing to make a few bucks is to make 10 nice drop point hunters ( or fillet knives if your area is coastal), and take them to a show
 
The cost of making knives is much higher than I want to admit. You can look at a knife and say it took 3hours to make plus x amount of material expense. But the cost formula has to include time spent for training, communication with the customer, down time due to repairs or fabrication of equipment, the list goes on and on! Then if I was working for an employer, I would have a benifit package.

So really time is my most valuable commodity. Low priced knives or high priced, we have to set a price on our time. What quality and volume of product can you make and how much time does it involve.
 
The cold hard economics of being a Bladesmith/Knifemaker is that everything we produce is a luxury item. Our income is based on others' disposable income. If others do not have disposable income, or perceive they do not, then it's unlikely we will see any of it.

That being said, during these last two years+ of hard economic times, those who offer knives in the $300 and below range have continued to do fairly well with sales. Those who are above that range have suffered sales wise. Most of us aspire to achieve a level of notoriety and quality that allows us to sell those $1,000+ knives, but the fact is, at that level a maker puts himself into a position where the percentage of buyers who can/will purchase is VERY small. So, in essence, it's sort of painting yourself into a corner. Once a maker becomes known ONLY for producing high end pieces, those looking for less expensive knives usually will not even consider looking/contacting that maker about their needs/desires.
Knifemaking is simply not a good way to ensure you make a "good" living. We have been conditioned through the magazines and knife shows to believe that the top end makers are selling those higher end knives left and right, but that's just not the case.
Too many times I have been in conversations at various shows with some of those "Top End" makers, and listened to them talk about how they had to take a loan out to make it to that particular show, or how they only have $100 in the bank, and that they needed to sell a knife to "pay the bills this month".
I will freely admit that the level of income being a Knifemaker is "hap-hazard". Were it not for my military retirement coming in each month, and being on a strict budget, I would be working another job.
To directly answer the question, I believe that you will realize more sales by making a larger number of lower end knives, but I also believe that during that time, it's in your best interests to build your skills, and your level of craftsmanship towards being capable of producing and offering some higher end pieces. Diversity is the key to any level of success in our business arena.
 
I hope this doesn't aggravate people, and I know it doesn't directly answer the question, BUT...

you left out:
3. licensing designs to manufacturers
4. teaching
and
5. publishing

for better and for worse, there's more money attached to thinking-work than to making-work in every industry I can think of, knives included.
 
I believe it was Ed who once said something along the lines of "if you make 10 knives for $100 each, or one knife for $1000, and sell all you make, at the end of the day you'll have $1000." Considering what the guys above have said, make the best knives you can, make them in the lower price range, and make as many as you can without cutting corners on quality.
 
ive found on b.f. the best knives are the ones you produce to use,and make them fairly priced, ive had alot of luck with that
 
I know very little about the knife making business. I'll be the first to admit it. The one thing I have noticed is to skip the middle man if possible. It makes more sense to sell a knife yourself for $200.00 versus selling to a dealer for $120.00. Just and observation. Maybe this is obvious to you more knowledgeable folks. Best of luck.
 
MSCantrell said:
I hope this doesn't aggravate people, and I know it doesn't directly answer the question, BUT...

you left out:
3. licensing designs to manufacturers
4. teaching
and
5. publishing

for better and for worse, there's more money attached to thinking-work than to making-work in every industry I can think of, knives included.
Click to expand...

Outstanding Post....
I know at least a fifty makers who have made over $25,000 per year off knife design licensing.. I know at least twenty who have made over $50,000 per year and about ten makers who have broken $100,000 per year solely from knife designs.. On top of that these makers are building and selling customs which is another cash stream.. The sky is the limit..$$
Much Respect
[youtube]S6ZATcvag1M[/youtube]
 
Even the high end makers are knocking out 'neckers' or similarly accessible quickie models. It's pretty telling I think.

As simply a consumer, I like that certain makers have a quality product I can actually reach and actually consider using vs their ultra custom art pieces.
 
High-end or mid-range, 100 neckers or 1 art knife, the emphasis should be on quality materials and craftsmanship. It's dumb to try to compete with WalMart, you have to be able to consistently offer smarter design concepts, higher levels of fit and finish and a willingness to use the very best materials available.

Increased profitabilty comes mainly from more efficient production.

As to licensing, I know almost nothing about it but it interests me very much. I'd love to have or more of my designs manu'ed by a reputable factory with high standards. Is that selling out? As Jason Newstead from Metallica said, "Am I a sellout? Hell yeah, we sell out every stadium we play."
 
I am a simple guy with a simple philosophy that has served me well. I make exactly what I want to make, to the best quality I can achieve with the tools and knowledge I currently posess. Then, I price them at what I need to make in order to keep doing what I am doing. I don't drop prices. If I can't sell it for what it is worth to me, I don't sell it, period. I fully expect every one of my knives to sell... and they do.

But.......

The most important thing I do, is NOT put all my eggs into one basket. Diversify your business as best you can. Currently, knives account for 75% of my business and I'm greatful.... VERY GREATFUL. However, knives only account for 25% of what I love to do and what I can pull an income from while still being my own boss. I would be a fool NOT to focus on knives while I am fortunate enough to be selling... but I'd be a bigger fool to think it will last.

I look as much toward the next "mystery money maker" as I do to see how this one rides out.

Sorry if that sounds hokey...... actually, I'm not sorry... like I said before, I'm greatful.


Rick
 
Well said, Rick. Not all business men make great knives. However, there are some knife makers who are great business men!
 
I've been managing, with some help from here and there, to pull it off. We're not anywhere near comfortable because my wife isn't working yet. But I'm somehow managing to keep things afloat right now, on knifemaking. (and a bit of side work doing holsters and belts and such)

I'm starting to get a lot of questions about classes and such, and would love to turn 2 particular designs over to manufacturers, but that hasn't all happened yet.

I'm about 65% in agreement with Rick. I do custom orders- mostly for knives I make anyway. Sometimes they drag on a bit and take a lot more effort because I can't put my arse in the shop and just "do stuff" as my muse or mood or whatever points me. But man, set me down with a pile of steel, wood, glues, pins, and leather and let me go, I'm going to have some fun!

I like making knives, and tend to work on the "user" end of the scale. When I put out what is- for me- a higher end knife (we're talking $350, here, not $1200), it starts to get very telling in terms of time. I did a dirk recently that was easily 3 times the hours of a regular sgian dubh or 57 (convex edc). so, in theory, I "lost" money on that. Whatever- it worked fine because I wanted to do it.

You have to produce. You have to sell. And you have to balance not cheating yourself with keeping prices in line with continuing to sell.

I have a couple rules. If you can survive until the rules bear fruit, they might be worth looking at.

1: Do Stuff (writing lists can help, but isn't Doing Stuff. Doing Stuff is doing stuff.)

2: Finish something every day. (not all projects are one day projects. Not all projects are even 1 week projects. but finish some project every day.)

3: never, ever, allow a lack of tools or materials to cause you to break rule 1. there's always something you can do.

If you Do Stuff, and finish projects, eventually money starts to take care of itself. Okay, it's not quite that simple, but if you respect your money, it's pretty close.
 
While handmade knives are definitely a discretionary, none essential purchase, I think we can get too hung up by defining it as a luxury item.

Looking around my house, almost everything I see can be defined as a none-essential or even a luxury. Like most people , I've got a TV, DVDs, furniture, toys, alcohol, carpets, wallpaper, ornaments etc, all of which are none essential and so discretionary by definition.

Most marketing and sales people know buying decisions are motivated by wants, not needs.
 
Make the knives you want and then to make $$ selling knife supplys (we all know every one wants to make knives and they all need parts )

really i cant add mmuch more to this
but pick a type of knife or KSO that you can make well find a style that you can call your own. then remember not to get locked into just that

keep making different knives it keeps you interested in making and keeps buyers looking at you new work
 
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