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Pricing Art for Sustainability

Pricing Art for Sustainability. Monika Waterall. Pricing Art for Sustainability. Pricing Dilemma Cost Allocation Budget and Ensuring Wages Wage-Based Pricing Joint Venture Advantages Cost-Based Pricing Attracting Investors and Your Investments. Pricing Dilemma: Paying Bills. Overhead

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Pricing Art for Sustainability

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  1. Pricing Art for Sustainability Monika Waterall

  2. Pricing Art for Sustainability Pricing Dilemma Cost Allocation Budget and Ensuring Wages Wage-Based Pricing Joint Venture Advantages Cost-Based Pricing Attracting Investors and Your Investments

  3. Pricing Dilemma: Paying Bills Overhead Supplies Short term supplies Film, paper Clay, glaze Long term = EXPENSIVE Camera, computer Kiln, wheel Rent Utility Wages Labor = Pay Yourself!

  4. Accounting Terms & Practices Damien Hirst • Sotheby’s auction • Art Factories • 160 employees • Personal business manager

  5. Add 4 weeks of pay • $36,000 / 52 weeks in a year • About $700 Gross, $500 after taxes (Single 0 withholding) • Divide bills as evenly as possible per week • Remainder = Approximate Extra spending (going out) • This is how much money you see in your bank account Personal Budget: Weekly Fixed

  6. Personal Budget

  7. Ensuring Your Wage: Industry Standard Labor Hours x hourly wage Glassdoor, Simply Hired, Ehow.com Yearly Salary / 52 weeks in a year / 40 hours a week Ceramics Artist $27,000 = $13 per hour Photographer $30,000 = $14.50

  8. Wage-Based Pricing ( cost x 2) + ( labor hours x hourly wage) = Price Per Piece

  9. Wage-Based Pricing: Long Term Cost Allocation

  10. Wage-Based Pricing: Short Term Cost Allocation

  11. Wage-Based Pricing: Wage per Piece

  12. ( cost x 2) + ( labor hours x hourly wage) = Price Per Piece Wage-Based Pricing: Price Per Mug Short Term Cost $0.19 + Long Term Cost $4.50 • Total Cost per Mug $4.69 • Total Cost per Mug $4.69 x 2 • $9.38 1 2 • Cost per Mug $9.38 + Total Wage per Mug$10.38 3 • Price Per Piece = $19.76

  13. Add Long Term Supply Costs from Sole Proprietorship: • LT Supply #1 $_______________ • LT Supply #2 $_______________ • LT Supply #3 $_______________ • =$___________________________ Total Long Term Supplies Payoff of Long Term Supplies: Sole Proprietorship • $_________ LT cost payoff and ST supplies from Sole proprietorship from 4 a. • / $_____________ Total Long Term Supplies • = _____________ # pieces to sell to pay off Long Term Supplies

  14. Payoff of Long Term Supplies: Joint Venture • $_________ LT cost payoff and ST supplies from Sole proprietorship from 4 a. • + $________ Difference per Piece from Joint Venture 4 a. • =$__________ • / $_____________ Total Long Term Supplies • = _____________ # pieces to sell to pay off Long Term Supplies

  15. Payoff of Long Term Supplies: Joint Venture • $_________ LT cost payoff and ST supplies from Sole proprietorship from 4 a. • + $________ Difference per Piece from Joint Venture 4 a. • =$__________ • / $_____________ Total Long Term Supplies • = _____________ # pieces to sell to pay off Long Term Supplies

  16. Joint Venture Activity Find Best Possible Shared Cost

  17. Joint Venture Activity • $_________ LT cost payoff and ST supplies from Sole proprietorship from 4 a. • + $________ Difference per Piece from Joint Venture 4 a. • =$__________ • / $_____________ Total Long Term Supplies • = _____________ # pieces to sell to pay off Long Term Supplies • Best shared cost = earlier payoff • Double Cost Expense Returns after payoff= attracting investors

  18. 30% Cost + 30 % Markup + 30% Labor + 10% Retained Earnings • = Price Per Piece Cost-Based Pricing 30 % Markup = pay off Long Term supplies, then profits after Break Even point 10% Retained Earnings = future investment More expensive supplies = higher wages

  19. Pay Off Long Term Supplies Early = Industry Investments Real Estate Brice Marden Bought SoHo (artist neighborhood) properties cheap Gallery for Other Artists Day 19 (Jeremy & Clare Weiss)

  20. Creating Capital: Sustainability • Easy accounting • Payoff of Long Term Investments = Pitching to Investors • Guaranteed • Supplies • Wages • Profits

  21. Pricing Art for Sustainability Monika.waterall@gmail.com

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