# Question



## rhett (May 11, 2008)

Person A, a retired person with a pension and skill in the shop vs person B, a person with an income based soley on woodwork and skill in the shop. If person A decides to sell items for the cost of materials, just to fill their free time, then how is person B supposed to compete?

Before someone tells me "you don't compete with hobbiest", I would like to add that I know more than a few retired woodworkers, who worked in an office all their life, that can teach me more than a few things about the craft. I fully understand the dynamics of a hobbiest vs a professional, but the only real difference is one costs money and one pays money.

This question arises only because I repeatedly see posts about how someone can charge such a low price for handmade woodwork. This is not me trying to tell anyone what they should or should not sell their work for. I do believe if woodworker A values their time at zero dollars then woodworker B's time is automatically set at zero.


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## Woodwrecker (Aug 11, 2008)

That's a good question Rhett.
I don't have the answer, but I'll be watching to see what others have to say.


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## roman (Sep 28, 2007)

there was a time when this really bothered me. As an example a fireman gets about 2 weeks off per month and in that 2 weeks he/she can knock out cabinets/furniture and "profit" isnt really a concern and how does one compete against that?

then came China and Ikea and it blew the doors off everything and everyone. Not even a "hobby" person can compete as I have seen ie., a vanity made in cherry, curved front doors, granite top, undermount sink with taps for 600 ..... ( I cant even buy the granite for 600 )

that said…....anyone who wants to build what I am building as a hobby and compete ?...........go ahead and good luck with that.


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## North40 (Oct 17, 2007)

I made that point to a nice gentleman at a craft show once. He said he only needed to cover the cost of materials, and I reminded him that he was competing against people who needed to make a little more than the cost of materials in order to feed their families. He didn't really have a response to that. Few other professions really have to compete this way - there aren't a lot of retired or hobbiest accountants who do it just for the love of working the numbers!

The thing is, we compete on a lot of levels, not just cost. Yes cost is a big one, but if cost were the only consideration, Wal-Mart and Ikea would have locked us out of the market. You have to look for areas where you are different and emphasise those points. Different people buy wood products for different reasons. Try to identify these reasons and then tell why your product fits the bill better than the next guy.


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## Sawkerf (Dec 31, 2009)

They really won't be "competitors". The hobbiest will probably be working alone in a small "home" shop with limited space and equipment which will restrict his/her ability to handle large or high production rate projects. The hobbiest will also have a limited market exposure consisting mostly of friends, family, or whatever customers they can get thru venues like Craigslist.

On the rare occasions when they do compete, the hobbiest will probably win if the job goes on price alone, but the "pro" will get the large jobs, or the jobs with the tight schedules.


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## PurpLev (May 30, 2008)

as a professional, you should change your state of mind… a hobbiest usually make things per his passion, where a professional will usually custom fit a piece per the customers design and input. as a pro, you should be approaching the market differently, and not head to head with the hobbiest that brings his pieces to the local fair. if the hobbiest is pushing his work in different venues - then you may consider that he's not considered a hobbiest anymore, but a cheap professional. in which case - he's at a loss, and after a while he'll figure this out himself. on the other hand - his customers are considered to have found a 'good bargain' but those prices do not reflect the market prices.

it all boils down to perspective, and explaining it to your potential customers. selling price is not always just about work and materials - but about an image, CS, and spirit in the pieces.

good luck  the sun is shining here today.


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## SnowyRiver (Nov 14, 2008)

This is an interesting question Rhett. I will, in not too long, be like woodworker A.

I have 40 years with the company I work for (telecommunications.) and will have a pension, plus other benefits. I also love woodworking. Even now, I often build things for my family and friends, especially for gifts etc. at my own cost. I just enjoy doing that although, as we all know, many projects can cost hundreds of dollars excluding our time. I think many hobbiest woodworkings will sometimes build things for nothing just for the pleasure of doing it, but I dont think that happens often especially in the large scope of things. I dont think there are many hobbiest woodworkers that would spend 8 hours a day in a shop under the gun to produce something on a schedule on a regular basis for nothing. I think the demand for good wood products far exceeds what a hobbiest can do. Although most people tend to know someone that can build something for them at the cost of materials, I still have a lot of folks asking me if they can pay me for something despite the high cost of custom furniture. I think the main thing is quality. If you do a good job, and you are diversified in what you can make, and you are reliable, you will still have buisiness. For me this would mean one week building an armoire, and the next week, building a deck.


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## CharlieM1958 (Nov 7, 2006)

PurpLev's answer is dead on.

As I said in the related topic, it's just not reasonable to ask someone else to raise their selling price so that yours won't suffer by comparison.

I'm willing to bet you love it when two grocery stores are having a price war and you get to reap the benefit of cheap milk, even though the stores aren't making much profit.

Or how about this scenario: Let's say there are only two plumbers in your town, and they get together and agree to charge no less than $75 per hour. You'd likely be ticked off about that, and rightly label it as price fixing. Now let's say your neighbor Joe down the block is a retired master plumber, and he'll gladly do your work for $25 per hour just to give himself something to do. Are you going to refuse to use him because he's hurting the other two guys? Maybe $75 per hour is a fair price for those guys when you consider that they have overhead, and need to put food on their tables. But it is up to *them* to market themselves in such a way as to convince you that you're better off using them. Maybe it's their warranty, or 24 hour availability, or whatever. It's not up to Joe to give up his $25 per hour retirement gig just to make things easier for the two pros.


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## ND2ELK (Jan 25, 2008)

Thank you CharlieM1958! I could not say it any better myself!!

God Bless
tom


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## richgreer (Dec 25, 2009)

I'm woodworker A and I am very sensitive to woodworker B. Here is my policy. At least 2/3rds of my work is for my personal consumption or gifts. I do quite a bit of work for my church for the cost of materials. I also do work and participate in a craft show sponsored by a charity once a year for the cost of materials. However, with respect to the craft show, the products are sold to the public at a reasonable profit-making price. All the profit goes to the charity. I will not permit the people at the craft show to discount my prices.

I occasional get requests to make something. Usually, the request is because someone saw my work at the church or a gift I had given away. They will say, I saw the gift you gave your sister and I would like one like that to give to my Dad. In those cases, I always charge what I think a professional would charge. If I get the job - fine. If not - that's okay too. I have a nice pension.

My formula for "what a professional would charge" is (cost of materials + estimated labor at $25/hour) x 1.25. That strikes me as a fair formula but I would gladly receive comment on that.


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## PawPawTex (Mar 16, 2010)

I totally agree with PurpLev and CharlieM1958 on this one.


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## RedShirt013 (May 17, 2008)

You charge the price of a professional job and in turn you provide professional work and service. Meet their schedule, match whatever finish the customer wants, design consulting, accomodate some changes, quick and efficient installation with minimal disruption, after-sale service, warranty, etc. A hobbiest just charging for cost of material likely will not offer all that and some customer may not be aware of that.

Look at it another way, if both are equal and pro's are competing with hobbiests, that obviously there is more labour supply than demand for woodwork. That actually shows the pro's are charging too much for their time. Of course that may be temporary and as soon as demand increase this issue will go away. Hobbiest may take a few jobs but they won't accept a full-time workload


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## Gregn (Mar 26, 2010)

I fall into the woodworker A category myself. I rarely ever sell anything although there are those who say I should sell my work. I respond with what would I do for pleasure and a hobby then. So I make things for gifts and family at my cost for the joy it brings me. So here's where I'll just be plain honest. I feel if someone wants me to make something for them they should have to pay fair services prices as if they went to any business. Which brings me to my problem I don't know what a piece would cost to make for someone. I don't want to make the price so low it just covers materials, and on the other hand I don't want to make the price to high either. If its a simple project I may charge 2-3 times the cost of material and the more complicated the higher the cost. So how does the hobbyist know what to charge for his work to be fair market price. I don't want to make the effort to shop around for prices, because I'm in it for the pleasure not to make it for a living. I have had people ask me to build cabinets for them, but its not what I want to do so I tell them to check with a local cabinet maker because I don't want to hurt his business by under charging what he does. Because then everyone would want me to make them for them then. I enjoy making one of a kind projects and hate making duplicate items. But wouldn't mind making a piece once in a while to make a little extra cash for new tools I would like to have. So my answer would have to be that the hobbyist really doesn't know what he should charge to be fair to everyone involved in the craft.


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## lumberdustjohn (Sep 24, 2009)

Rich, interesting charge formula.

Charlie, good explanation.

I fall into the hobbiest roll, I know I rarely charge enough for the few orders I do get.
The few orders that I get change the way I look at my hobby as well.
I would much rather make something for a charity for free than to be under the gun with a tight schedule.

If something is needed that I can do when I want it makes it a pleasure to do.

I still have a day job that requires time tables and scheduling.

It's nice to get away from that.


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## hObOmOnk (Feb 6, 2007)

I'm a pro.

My average cost of materials is about 10% (one tenth) the retail selling price or about 20% (one fifth) of the wholesale price.

I have no problem in quoting an hourly rate of $90. My effective hourly rate, after adjustments, is seldom less than $60 per hour. I know of no professionals in our guild that charge less than $60/hour.


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## BOB67CAM (Dec 28, 2009)

i totally agree with pawpaw, agreeing with purple and charlie..lol


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## AnnaCatherine (Aug 15, 2007)

Your signature line says it all for me.


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## rhett (May 11, 2008)

I think I need to clarify a little. I am not worried about competing with a hobby shop when it comes to my profession, which is cabinetry/built-ins. There isn't any competition in my opinion. Matter of fact, I don't know anyone who thinks swinging around large sheet goods is any type of hobby or fun, and I do not feel as I am suggesting any type of price fixing.

My issue is with the actual woodworking part of things. If A and B are both making small widgets, then it is impossible for B to compete. In a small artisan shop or any other place where the buyer cannot directly be influenced by the creator, price is the final decider. I hope anyone who cuts wood, would want their efforts and time acknoweledged. Your average consumer has no idea the time it takes to make an item, and when it its undersold, they continue to be ignorant of that fact. Undercutting and underselling hurts the entire craft, that is my point.


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## hObOmOnk (Feb 6, 2007)

My "average customer" goes to the same juried craft events where I exhibit and I do not have a problem in getting my price.

Undercutting and underselling is a moot point when artisans make quality, choose venues where they fit and appeal to markets that will meet their price.


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## live4ever (Feb 27, 2010)

This issue spans many, many professions that have a significant hobby component.

I have firsthand experience with photography. It was a passionate hobby of mine, and I was (am) pretty good at it. Though I started off simply wanting to "buy myself equipment" and "pay for the joy of doing it", eventually the model was unsustainable because of how popular my business was becoming. I was forced to try to run a legitimate business with the associate costs and issues. Since I wasn't going to quit my real day job and career to do it, you can imagine it eventually failed. But I can understand the sentiment towards the non-professional hobbyists since I crossed the line myself from hobbyist to paid hobbyist to paid professional within the span of two years.

At the end of the day, my experiences bring me to the following conclusions:
1) Yes, pros DO compete with hobbyists in that they do lose a number of sales to hobbyists. However, some of those sales would never get to a pro anyways because the consumer would not be likely to pony up the cash required (or doesn't feel it's worth it).
2) That's the price you pay for being a professional in an area that is so amenable to hobbyists. There tends to be a lower level of respect from the general population towards the professional simply because so many people do it as a hobby (and do it well). However, most of being a professional has little to do with the actual trade but more to do with areas of running a business, managing finances, and taking care of customers.
3) Professional associations that set guidelines and standards are one potential solution for professionals wishing to distinguish themselves from hobbyists and justify the higher cost of their product.


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## CharlieM1958 (Nov 7, 2006)

*However, some of those sales would never get to a pro anyways because the consumer would not be likely to pony up the cash required (or doesn't feel it's worth it).*

This is a key point. It was in my mind when I wrote my response, but you expressed it better. At the craft shows I'm talking about, if person A and person B *both* price their goods at a fair price which includes their labor, *neither* of them is going to sell anything.


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## hObOmOnk (Feb 6, 2007)

Charlie:

*At the craft shows I'm talking about, if person A and person B both price their goods at a fair price which includes their labor, neither of them is going to sell anything.*

Why is that true?
Price isn't everything. It's the best marketer that wins.

This is *ALL* about business.


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## Gene01 (Jan 5, 2009)

I'm a retired hobbyist. I only make what I like and what challenges me. (Lately, everything seems to be a challenge.)
Some things I have made have been sold. I set my price based on what I feel it would sell for in a retail situation. If it sells, fine. If it doesn't…fine. 
I hope that my stuff is so unique that I'm not infringing on any other craftsman's territory. I would never attempt to undercut on the basis of price.


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## CharlieM1958 (Nov 7, 2006)

Randy, I agree wholeheartedly that price isn't everything. I was just saying that the kinds of folks who go to the craft fairs around here where I live are not looking for $300 humidors. They are there to see what they can pick up for $20 or $30.


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## Nomad62 (Apr 20, 2010)

I play auto mechanic for a living. There are many people in my neighborhood that will work on cars in their garage for little money, I need to charge quite a bit. How to compete? I don't. I charge what I charge without apology, and tell people that I need to do so to make a living. If they want to go to the cheapest guy in town, that's ok; I do not need to be the cheapest guy in town because that guy goes broke. If everyone went to their pals garage, then my job wouldn't exist. But here I am. So there is a market, and I create it by being here. I suggest that a person needs to generate the money they need, and to do so without worrying about being cheap. The last customer I need is the person looking for the cheapest job, they are the ones that cry the loudest and have the worst vehicles. Wood is not the same, but it is similar; our income is dependent on our market in either case. If Joe Blow wants a table made for ten bucks, let him go get one from someone else. We all know there will always be a need for craftspeople, so let us not sell ourselves short. I agree that the big stores hurt the small ones, sometimes even closing them. It is unfortunate, but that is the way it goes. That doesn't mean woodworkers need to price down to what Ikea charges, it simply means the market is smaller. There is no easy answer, but the best you can do is stick to your guns and sell your self and your products with the pride they deserve.


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## Nomad62 (Apr 20, 2010)

Back again. Last night I had a conversation with a high-end furniture maker on this subject. He said he didn't have much of a concern with it as his sales were generally made through studios and interior designers, making his products directed into the market his products are intended for. His statement was that if his products are sold along with other products of similar nature and cost then the typical customer of said studio will be anticipating just what is there, making the sale much more likely. It boiled down to working with other people in a manner that helped everyone involved. His products were very nice, and were made by happy craftsmen that were paid well and proud to work for him. His workshop was filled with very, very nice equipment that was paid for by his continuing business. Perhaps some snooping around in your area may lead to a cooperative effort in the same manner?


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## dusty2 (Jan 4, 2009)

I am retired and I have some woodworking equipment. On a regular basis, I make sawdust. From those sawdust sessions, on occasion, a product rises up and I am satisfied. I hardly ever sell anything but I do accept whatever the person who carries off my product wants to leave behind. Most of the time that is one of the kids or grandkids and what is left behind is empty coke cans and dirty dishes.

I love my hobby and I cannot imagine competing with anyone. I entered into this craft as a hobbyist and I will leave the craft the same.


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