Soapbox Time: "Fair Wages" and the Craft Business

Since this blog is my own personal soapbox, I'm getting up to stand on it on the issue of "fair" wages. There has been a lot of discussion on this on the forums on Etsy, and since Etsy is populated primarily by liberal artistic types, my point of view is... not shared by most of the people on Etsy. Specifically they are decrying the fact that a lot of the handmade stuff being sold on Etsy is "underpriced".

Let me start with an example. My cowboy booties are being sold on Etsy for $15. I did a quick search to see who else is selling cowboy booties, and there are a few other sellers who do, but mine are the highest priced booties of their type on Etsy. The next price point down from mine is $11.99, and there are booties going for $6 and even for $4.

Now there's no way in hell I'd sell my booties for $4. Why not? Because I value my time at more than that. I'm a math teacher and my professional time is worth like $50 an hour. But not all my time is worth $50 an hour. I cannot, for example, find anyone who will pay me $50 an hour to sleep. In fact, I can't find anyone who will pay me to sleep. Likewise I cannot do my professional job while I'm tending my kids, so that time isn't worth $50 an hour either. My evening time, which I do spend making booties most of the time, could be worth $10 an hour if I could pick up a tutoring client. But to pick up a client I'd have to get my house clean and put up flyers, and who would pay me to do that? I'd spend a couple hours getting my house clean and putting up flyers so that I could earn $10 for one hour in the evening, so I'd effectively be making $3.33 an hour to work at tutoring.

You can see why crocheting baby booties and selling them for $15 a pop is appealing to me. I get paid to sit there and do what I like while I watch TV with my sweety snuggled next to me! I am a superior crocheter (as I've found out when trying to hire crocheters to do contract work for me) and my work is worth the bucks.

Now, I don't know what the situations of the other bootie makers on Etsy are, so let's just imagine a typical competitor. Her name is Granny and you've seen her work going for way cheap at any craft bazaar. Granny is 57 and she's on disability. She sells her booties for $6 and makes just enough money from her sales to buy a few nice things for her grandkids for Christmas. Suppose people go on Etsy and look at her booties and look at my booties, figure they're the same booties despite all my marketing ploys, and buy Granny's booties. Is Granny the enemy of "fair wage" proponents everywhere? Is she evilly undercutting my prices by paying herself "slave wages"?

Well, NO. Granny's time is worth much less than my time. Because she's on disability, her options are more limited. She can sell booties or she can do nothing. Now, if Granny were really smart, she'd see that my booties are going for $15 and she'd price hers at $10 and buy her grandkids two packages of underwear each at Christmas. But let's say Granny doesn't know much about these crazy Internets tubes and continues to sell her booties at $6. And let's assume hers are equivalent to mine in workmanship etc., all other things equal. Then people will flock to Granny's Etsy shop and buy her booties all the time. This will increase demand for her booties, making a strain on her time, and if she won't raise her prices to cool the demand, I will get more demand for my booties when hers sell out again. If I can't keep up with Granny and her low low pricing and high production levels, then it's a sign that I need to let Granny make the booties and I need to make something else.

What's a "fair wage?" Like anything else, the price of labor is exactly what the market will bear. If Granny's willing to accept $2 an hour for her labor, then that's what it's worth. If I think $2 an hour is too low for my labor compared to the $10 I could get, then my labor is worth more than $2 an hour.

Crafting is one of the ways people get around the minimum wage. There are tons of other ways, like working off the books, working as an independent contractor, or doing an unpaid internship to get "work experience" that will allow you to command a higher wage. These are all things that stay-at-home moms, illegal immigrants, and teenagers do, because for whatever reason their time isn't valued at minimum wage. For SAHM's the problem usually is that the costs of working outside the home (child care, etc.) are too high to make it worthwhile. For illegal immigrants, working off the books has value to them because it keeps them away from the notice of the authorities. Teenagers, finding that they are presumed to be dilettantes because other teenagers are, have to work for free or do babysitting under the table to prove they're not dilettantes before their time is considered valuable enough for minimum wage. If you set a higher minimum wage and change all these calculations, all you do is move more people under the table.

I highly doubt the "progressive" sellers at Etsy who cry over "fair" wages for crafters would take kindly to the argument that raising minimum wages to a "fair" level would drive more people into their profession and undercut their own profits, but there you have it.

If your business is being undercut by someone with lower prices, what should you do? Well, if you are crafting for more than underwear money, like hoping to make a living, you have to act like you're serious about it. You have to approach it like a business and see what maximizes your return and how you can scale your business up to a level that it would take to support you. You have to set your prices based on not just other people's prices, but your costs and the quality of your workmanship. If you craft for a living, presumably you have more experience than some beginning knitter making a few extra scarves. Your experience should be worth it. Put that into your marketing. Use superior materials and workmanship. Make your product attractive. Package it innovatively (my booties, for example, are the only ones of their type on Etsy sold prepackaged in a gift box, which costs me about $.25 extra). Sell things in sets. Improve your customer service-- offer gift shipments, for example. Promote your shop. Learn about photography and take better pictures of your products. Constantly re-evaluate your product line, see what items are profitable and which are not, make the profitable ones. In short, put work into it. Too many crafters focus on the "craft" side of the craft business and not enough on the "business" side, as if people would flock to them and buy at "fair" prices if only their crafts were perfect. Then they get all offended when people don't.

I'm Wacky Hermit, and this was my Soapbox Time.