Hourly Earnings, Part 1: Wholesale

This post is the beginning of a research project. It is the first of several posts on the same topic that I will write throughout this year, and possibly beyond. My pottery business has grown considerably in the past two years, but my ambivalence to let go of my graphic design practice continues. I realized this past winter that I know how much I earn per hour as a designer, because my contracts are based on an hourly rate. It's not an exact number, because it doesn't account for expenses, or for the time I spend doing non-billable work. But it's a pretty good idea. So what I want is the same sense of "knowing" about my pottery business. How much am I really earning per hour by making pots? I don't need an exact answer, just a pretty good idea.

I have heard and read lots of discussions on this subject, but they all come from a backwards and presumptuous point of view, i.e. how much of an hourly wage should I anoint upon myself before I sell my pots? This is a pointless and unresolvable question, because the intangible factors that differentiate every potter are so vast and varied. An exceptionally talented and skillful master should be rewarded as such for his/her time, while an aspiring amateur's time can literally be worth less than zero.

So instead of pondering what I should earn I am going to calculate what I did earn.

Here's my methodology ... whenever possible I will separate pottery sales into quantifiable portions. I will keep track of the time I spend to complete the work. I will subtract any applicable expenses from the sales amount, then divide what remains by the number of hours spent.

The "quantifiable portions" will include wholesale orders, retail art shows and festivals, open houses, registries, etc. (Maybe I'll even settle the debate between the predictable volumes/lower prices of wholesale, vs. the unpredictable sales/longer hours/higher prices of retail?)

How I price my pots ... it's a long-term process. New pot designs start as low-priced prototypes. The prices and designs of fast sellers evolve over time. Slow sellers get eliminated. I compare new designs with the price points of my established good sellers. I also compare my prices with the other potters who are working at the same level as me. I don't want to overprice, because I think a handmade pot is an everyday, down-to-earth object, and should be affordable to average pottery fans. However, I am more careful not to underprice my pots. Underpricing is amateurish, indulgent, and harmful to other professional potters.

Now on to the calculation ... this first calculation is for a large wholesale order. It is the largest order that I wrote at the Buyers Market in February. It contains a good mix of low, medium, and high priced items, therefore I think this will be a good measure of wholesaling in general.

I kept track of the time spent working on it, including the following tasks:

• preparing clay (recycling, pugging, wedging)
• building pots (throwing, trimming, altering, handbuilding)
• loading and unloading the kiln
• glazing
• studio cleanup
• applying hang tags to finished pots
• packing for delivery
• accounting

I did not track the time spent on tasks that didn't specifically apply to the order, including glaze mixing, or the afternoon I spent carrying a year's supply of clay down the stairs into my basement studio.

From the total dollar value of the order, I subtracted the following expenses which I could quantify:

• clay
• shipping boxes
• a percentage of my Buyers Market expenses, equal to the percentage of Buyers Market sales that this order represented (by far the biggest expense related to this order)

I did not subtract the following expenses which I could not quantify:

• glazes
• tools/equipment use and maintenance
• utilities
• bubble wrap and packing peanuts (some purchased, some recycled)

The dollar amount that remained was divided by the total hours spent. And in the end I made $24.74 per hour. My official response to this is "not too shabby!" I feared that I was making less than minimum wage, but the real answer is nowhere close to that. The answer fits my self-evaluation as an up-and-coming, but bona fide professional potter. My time has a good value, but the value still has room to grow, as do my work efficiencies, craft skill, and business development.

One final note about punching an hourly timeclock ... this is not a job that I can do for 8 hours a day like a normal job. The longest I was able to work in one day is 5.5 hours, and at that point my elbows and hamstrings were aching! My usual workday is more like 3 or 4 hours. So that's another issue that I need to address, how to reduce the physical strain of making pots so that I can be more productive per day. (Then again, having worked in the corporate world, I know that many people with 8 hour-per-day jobs don't spend 5.5 of them being productive, so maybe I shouldn't worry about that.)

Coming soon ... I will repeat this calculation for other wholesale orders over the next few months. Maybe different types of orders will have a different result, or maybe I'll get better as the year goes on.