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pricing: How Low Can You Really Go ?????

Discussion in 'Picture Framing Business Issues' started by BILL WARD, Mar 20, 2009.

  1. BILL WARD

    BILL WARD SGF, Supreme Grumble Framer

    interesting article on pricing : How Low Can You Really Go----via INC mag
     
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  2. Jay H

    Jay H PFG, Picture Framing God

    Neat article. I like this bottom line, "Competing on service instead of price is challenging in a down economy, but entering a price war with competitors is risky. Limited discounts can boost sales without branding the company as a discount seller."

    I think that hits on something we don't focus on enough. How well we are branded hinges on how well our pricing matches how we are precieved by our customers. Often I think those two are mix matched and it confuses clients.
     
  3. Dave

    Dave SPFG, Supreme Picture Framing God

    I agree, Jay. I like to think that my framing is not a commodity.

    Since we've been framing nearly 100 years I play up that fact. As a consequence, both good and bad, I tend not to get the down and dirty jobs but people bring things to me when they want "special treatment". On the downside I tend not to do very much economical framing or production jobs which can be very profitable.

    One way I play up this factor is to sign the back of each frame job with the date, my signature and the words "for Beth Jones" or the like. Customers almost always comment that they appreciate that I do that.
     
  4. couture's gallery

    couture's gallery PFG, Picture Framing God

    thanks for the heads up on the article , Bill....gives something else to think about.
     
  5. framah

    framah PFG, Picture Framing God

    Wow!! Dave... nearly 100 years! you must be older than dirt.:shutup::shutup:

    I really do like your idea of signing the back. May i copy your style?
     
  6. Dave

    Dave SPFG, Supreme Picture Framing God

    I really think it would be better if you signed your own name...

    :party:
     
  7. Smile with Style

    Smile with Style CGF II, Certified Grumble Framer Level 2

    A thought provoking article Bill. Thanks for sharing.
    I like his idea of featuring the lower price items which can afford a discount (because of a higher markup or vendor rebate). Yet, he didn't change the perception of his high end pearls by discounting them.
     
  8. Jay H

    Jay H PFG, Picture Framing God

    Yes but he still has floor and ceiling in pricing and only a limited ability to sell outside of those boundaries. His pearls sold from 1k - 5k and his "cheap" stuff was still $600 (I think it was). He didn't take on $49 ear rings and $20,000 tennis bracelets. Doing so would probably confuse his customers and damaging to his brand. We have the same limitations although framing doesn’t vary in pricing quite as much a jewelry.
     
  9. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    One thing missing from so many retail framers is that so very important component called mix

    We worry about creating a "branding" of low price or discount

    Is that better or worse than creating a "branding" of being "expensive"

    Put yourself in the consumers shoes for every single other product that you currently purcahse and ask that same question of that product or service

    What makes what we do so uniquely different than every other retail product?
     
  10. Jay H

    Jay H PFG, Picture Framing God

    I hear ya loud and clear Bob. But don't you think there are limitations in the range of goods we can offer before we confuse out customers? Is there a point where a really cheap line can erode others?

    I was recently looking for a new trash compactor. Sears had one crappy looking cheaply made piece of junk for like $399. The next 10 was closer to $600 and one or two were well over $1000. I notice three levels with majority falling in the middle. I'll bet they sell more from the middle also. I think I know why they didn't have 10 at $399 and 1 at $600 and 1 at $1000.

    Having a mix seems to be a good way to catch some extra customers and widen the perception of your shop. Operating from any extreme doesn’t seem sound. Offering to wide of a mix seems counter productive to me also. Whatcha think?
     
  11. Dave

    Dave SPFG, Supreme Picture Framing God

    You pose some great questions, Bob.

    Both methods of branding can be effective but if both branding identities are presented simultaneously then one defeats the other and the customer becomes confused.


    I'm not sure if you are implying that we are not different than other retail products that consumers shop for or if you are looking for the differences between general retail products and custom framing services.

    Framing can be presented as a commodity in the "price competitive/economical" branding model or as a specialized service in the "luxury" branding.

    Two distinctly different branding approaches ...both valid. I'm sure Bic Corporation of America has built a large and profitable business based on the first branding model and Mont Blanc has carved a solid niche in the luxury branding arena. Bic sells a practical economical solution for putting pen to paper and has a huge market. Mont Blanc also has a tool with an ink delivery system but mostly sells image over functionality.

    Bic wants to be in every retail store in the country and available to the mass market whereas Mont Blanc limits its distribution and does everything possible to control the final selling price to the consumer so as not to become a commodity.
     
  12. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    hey guys-One point of view

    When a consumer goes into a meat counter (or, for those over 40,a meat market) don't we see right next to that Prime cut Rib Eye, ground beef? And, do you think that anyone that shops probably has a good sense of a "fair price" for hamburger? And, if that price is not "competitive" does that diminish the "experience" of buying that Prime cut?

    Make no mistake to some probably not much. But does the "high end" meat purchaser get a negative impression that this market does carry ground, and at a great price?

    In this economy (really, any) that rarified air is so limited

    Yet, there may be a few ultra high end meat markets

    Probably just not many

    Bottom line: I doubt many consumers would be turned off "branding" wise ofa meat counter that carried ompetitively priced ground beef along with Prime cuts. Certainly, this consumer doesn't
     
  13. Cliff Wilson

    Cliff Wilson SGF, Supreme Grumble Framer

    On the other hand Bob, if the meat case was full of ground chuck and stew meat and the display of "low cost" meat over powered the displayed "good cuts" it wouldn't matter how good the meat was in the freezer, you'd decide they probably weren't a "quality" butcher.

    We DO have to be consistant with our image. Our advertising, store displays and product have to portray a consistant message. Of course, that doesn't proclude have lower cost value options like my recently announced "Frugal Framing" options ;-)
     
  14. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Isn't that the whole purpose of determining what image ("brand") you wish to portray?

    I go back to my original post about "product mix"
     
  15. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Isn't that the whole purpose of determining what image ("brand") you wish to portray?

    I go back to my original post about "product mix"

    A skillful "butcher" can be more things to more people than just prime cuts. I might hazard a guess that he may actually sell more "lower" priced offerings that "Prime" cuts with the majority of his sales coming from more "middle of the steer" cuts

    (I actually already know that answer)
     
  16. j Paul

    j Paul PFG, Picture Framing God

    I just had one in because of our "Value Line" framing advertisement starting at $24.95 for 8x10.

    She had two prematted 16x20's and two 8x10's. She ending out picking a frame for $168.17 for the 16x20's and 58.37 for the 8x10's.

    She decided to do just one of the 16x20's now and the rest next month. (that will be an order total of more than $400. + a new customer in the system)

    Get them in the door! The "Value Line" is a good value, so presumably (true) are the rest of our offerings. Our "Value Line" is presented on an attractive display board seperate from the rest of our offering. Selection is limited to about 12 mouldings/6mat.

    Also had one earlier because of the "Value Line" and hers came to just under $100.00 because she didn't want to spend much on her cheap poster.
     
  17. PaulSF

    PaulSF PFG, Picture Framing God

    Advertising the "value line" seems to take the risk out of visiting the framer. You know that at the very least, you can get out of there spending only $29, or $49, or whatever. And if the value line options actually look nice, then it's a real value.
     
  18. BILL WARD

    BILL WARD SGF, Supreme Grumble Framer

    I just knew this one'd draw some thoughtful comments!!!

    I got a couple of really interesting things from it:
    #1-"One way I play up this factor is to sign the back of each frame job with the date, my signature and the words "for Beth Jones" or the like. Customers almost always comment that they appreciate that I do that" what a great/SIMPLE thing to do !


    #2-"PaulSF Advertising the "value line" seems to take the risk out of visiting the framer" true, and on the value line subject---Engelsen rep tells me they are in the process of introducting a new value line! we will all be able to view it at our annual PPFA SpringFling tabletop trade show & education forum in Sarasota next month:beer:---announcement to follow shortly in TG.
     
  19. Cliff Wilson

    Cliff Wilson SGF, Supreme Grumble Framer


    Bob, based on past conversations, we are in complete agreement on what a shop should be offering and I think even to some degree how they should be offering it.

    You seem to be worried that many (most?) framers are afraid to offer lower cost solutions and are trying to remain "boutique" destinations instead of broadening their mix. Although I believe this was very prevalent 5 years ago, what I'm seeing lately is a number of framers panicked about the economy warping their shop image to such a degree that they may loose their traditional customer as this downturn reverses.

    I think some are trying to become "discount" framers to the detrement of their image and style.

    The key is maintaining a balance appropriate to the image you are projecting and the clients you want to maintain.
     
  20. Jay H

    Jay H PFG, Picture Framing God

    The stories above was about how to increase a mix AND maintain brand. The two go hand in hand. Bob is the master of the first half but the second half of that equation remains undiscussed.
     
  21. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Hey Jay-No one said it would be easy to increase mix and maintain Brand identity

    But, perhaps an analogy might help

    I used to use GM as an example, but with their didfficulties, I'll use Nissan

    They successfully create a vertical integration by acknowledging differing strata nof consumers. They also build "Identity" at each level of strata completing a "Loyalty" component that helps that consumer use their "Brand" as their needs or pocketbook changes

    For the beginning client (or second car) they offer a Sentra. Let's call that a poster special

    For a little better you can move up to an Altima (Value Line?) or a little higher a Maxima (Bread and Butter, middle of road?)

    For a sporty (or specialty framing) they offer a 350Z

    And, for the luxury client they offer Infiniti (gold leaf, fabric mats)

    And, of course a whole bevy of SUV and Van selections

    The key is they can move a client up or down the product mix as the needs or pocketbook dictates. As a client "matures" they can automatically climb that vertical ladder where a Maxima might be more appropriate when the Infinuiti may be out of budget

    But, the "Brand" is pretty solidly reinforced at each level with the quality of the product, the attention to detail and the professionalsm of the staff. All that changes is the level and the price until you reach the highest level (Infiniti)

    Now, how we create that same vertical integration really is not much different than how Larson approaches the marketplace

    It's a matter of Balance of Sale

    take glass or mat boards or moulding, they offer a wide range of products realizing that not everyone needs only Archival quality Fabric mats or Museum glass or Sevilla frames. And when you order reg glass or paper mats or Am Classics you get the same level of care and quality that is not impacted by the product or it's perceived impression. Any framer not buy from them because they offer paper mats or OEM11 metal frames?

    Our consumers aren't really different

    The key is to maintain a full a range of products as logical an dlet the consumer decide. Appreciate that you probably will not see many Sentras at the Infiniti dealer in major markets, but most of us simply cannot survive on tht level alone

    How you market, display and sell each level is also a pretty critical element

    But, i never said it was easy
     
  22. CAGallery

    CAGallery MGF, Master Grumble Framer

    Bob, I really like using Nissan as an example. We have been working on doing that - maintaining brand yet offering a broader range of products than in better economic times.

    The problem we are experiencing is that the labor costs (design time) many times remain the same for the lower end as for the higher end. We have always tried to give all that we can of ourselves to our customers. You cannot now tell a customer "well, I can't spend this much time with you because you want our value line". And this is a cause of concern for me and I am sure for others who have employees at the front counter who need to be paid.

    The question is can a shop be everything to everyone?

    Chavie
     
  23. Kirstie

    Kirstie PFG, Picture Framing God

    Yes, and the labor time is often similar for the poster frame or ready made and mat as for the medium-end frame and mat, with a difference of sometimes $200 or more on the ticket. One of my sales today took quite some time: Two restorations, 7 prints, 4 prints brought in, 11 frames: around $1300, all materials in-stock. That's a lof of product and framing for the money. There is profit in the materials but the labor is still there. It seems like six months ago we had several two frame orders for that size ticket every weekend. Now the lower ticket is the norm. I am not complaining. I just feel like we are working much harder at the shop, with more labor and stress, for less profit.

    Still, an order is an order in this economy and my goal is to work really hard to get through these times and come out the other end when times are better with a slew of repeat customers. Meanwhile I'm glad I am not any older than I am already...creak, groan.
     
  24. CAGallery

    CAGallery MGF, Master Grumble Framer

    I feel the same way -- very stressed out and working harder than ever. And although we haven't laid anyone off yet we are being very careful about hours and extremely generous in agreeing to requests for unpaid time off. But of course that means more work for me personally.

    Same goal here. Hope it doesn't take too long to get to the better times because it sure is harder to work like this than when I was in my 20's!
     
  25. Jay H

    Jay H PFG, Picture Framing God

    But Bob, "new cars" is a pretty narrow range of products. New Nissan cars is even narrower. You'll notice that vary rarely does anybody sell new BMW's (or new Nissan's for that matter) next to 90 Ford Rangers.

    There are lots around here named "Under $5000". They sell cars that some lots take as trade in and haul straight to the junk yard. I think that's because they too only have a range of products they can effectivly sell.

    Our product is even narrower than new Nissans. So I guess all in all it doesn't matter much. However I've been in enough shops to see that framers try hard to push the scope of the product we sell. Some do a good job showcasing special framing treatments. Some do a good job showcasing wham-bam-thank you-Sam framing out the door. Many, that I have seen, are in some sort of identity crises and I didn't get the same opinion of their shop as they have. Many are adopting a wider range of products but communicating that with clients is largely ignored.
     
  26. hadleyoldwestgallery

    hadleyoldwestgallery Grumbler in Training

    I know I am fairly new at all this as far as framing, 9 years, but one thing I have seen, even in this economy is that given the option customers will always upgrade. In my previous life I worked as a store director for a grocery chain and we always displayed what we wanted the customer to buy(largest profit margin) and it was always at eye level. It is not uncommon for our customers to come in looking to spend $75 to frame a 16x20 and fall in love with the $200.00 frame. If they don't buy it then they will come back later when they do have the money or leave the art work and say they will pick it up in a week. When they see the two frames side by side it is not hard for themr to make the choice.

    We do sell alot of our inexspensive frames but we sell even more of our top of the line work. The labor is sometimes only an hour difference between the $75 sale and the $200. The trick is giving the customer the opportunity to trade up and we offer our Nissans right next to our BMW's and people are still willing to buy what they really want.http://hadleyoldwest.com
     
  27. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    May I suggest, that in the car analogy, that a first time or new car buyer probably tkes more time than a higher end buyer. And, I speak with great authority on this matter from a purely personal perspective

    All things to all people? Absolutely not. But, more things to more people

    Many wish to suggest that I am advocating low end options. No way, but, we should not ignore entire market segments

    A wiser method may be to offer many upgrade options at every level. I'll bet that you can get the same sound system on the Sentra as the Maxima

    One thing that may be overlooked is the need to improve our selling skills; not only on the upgrade ability but also in the time required. How many of us have spent inordinate amounts of time on a No-Sale? Improving closing techniques shaving 5 minutes off every sale make that "extra" 5 minutes on a low end sale just that much less damaging

    That should make everyone happy. Right?

    Jay-You know that I drive nicer cars. They carry Cadillacs, Hummers and Saab, but right on the adjoining lot is their used cars lot with those "under $5,000" babies. I know in th eold days, dealers were single brand houses. Today, that is really unusual, especially in smaller markets where multi brands co-exist. I know the analogy is narrow-by design. The key is to find a "Best Practice" and adapt it here applicable
     
  28. David N Waldmann

    David N Waldmann SGF, Supreme Grumble Framer

    I believe Jay has it right. A frame can be anywhere from $30 to $3,000 (ok, a lot more, too) - a 100 fold difference. I can guarantee there is no such car dealer that has such a wide range of prices. The cheapest new car out there is about $10k. There are almost no million dollar cars out there (only custom, as far as I know), and you can be sure they will not be for sale on the same lot as an Aveo or Yaris. The closest car family I can think of right off would be Mercedes - they have entry level 30k Cs and 400k Maybach 62s. Same thing at the meat market (yes, I'm over 40) - they have $2 ground chuck and MAYBE $20 USDA Prime steak, but you probably won't find the caviar and fois gras in the same case.
     
  29. Jay H

    Jay H PFG, Picture Framing God

    Exactly my point. They do not sell their entire inventory side by side. They don't even sell $5000 cars from the same building. I suspect people wanting a 02 Taurus would be intimidated by the marble floors of the Hummer dealership. They may even consider it a waste of money. The Caddie buyer wouldn't be wooed with a row of desks and a wobbly ceiling fan precariously attached to a drop ceiling. Why do we framers think we should have unlimited flexibility to sell from both ends?

    I do think that we should offer a wide range of options. Still I think there are limitations. The biggest problem isn't the offerings it's the execution. I have completely and totally rejected the "high end" of the framing world.

    I do sell a little from the bottom but mostly I'm happy with my lot in the middle(ish). Maybe its a cop out from a poor salesman but I think it goes a long way to reinforcing who I am and what I sell to my customers. I think I have a nice looking shop but you will find no LJ, Roma, AMPF, closed corner anything, or museum glass in my shop. It's not because I don't think there is money there. I just don't think I can incorporate it into my current operation and sell it effectively. A couple of times I have seen the problem reversed.

    I think car lots are smart to segregate their offerings and presentation. Even if the same company owns both new and used lots, the packaging and execution fits the product.

    I remember one shop had painted block walls and a yellow drop ceiling with nude 8' florescent fixtures running the length of the gallery. At the design counter they showcased mostly premium mouldings. That store is closed now. Anytime I hear of price resistance I often wonder if this could be part of the problem.

    All in all I do hear ya and agree.
     
  30. surferbill

    surferbill SGF, Supreme Grumble Framer

    I think that's the point a lot of picture framers might be missing.
    In a slow economy, any sale is a good sale, as long as you make a little money on it. IMO

    You can brand all you want, but if you don't have customers coming in the door with framing orders and making the sale, you're not going to be around very long.

    In the last few months, even my wealthy customers are pinching pennies and looking for a deal.
    I don't think I've seen this much price shopping from customers in all of the 28 years I've been in business.
     
  31. j Paul

    j Paul PFG, Picture Framing God

    This analogy only works up to a point, and the argument against it the likewise.The fellow that only has a budget for a $10K car might like to have that 40K or 80k car but he is dreaming.The person that wants a $300. frame for $30. is dreaming too. But some of those people only want to spend $30. on this piece and can and will spend $300 or $3,000. on another piece. A $30.00 frame and a $300.00 and a $3,000.00 frame mathematicaly may seem to be further apart, but in real dollars they are much closer together than a $10K or a $80K car.
     
  32. rubytuesday

    rubytuesday True Grumbler

    The car analogy is relevant to a point, and I don't know about you guys, but we don't 'trade in 'old frames like you can do when purchasing a newer vehicle... that makes it more affordable in their minds when making a decision to upgrade to a new car.

    To get more work in lately , we have been doing an email/online discount on a specific item - this month it is 30% off wedding photos, last month it was original artwork, next month it will be something else. People will bring their work and we offer the discount, and so far most people will bring in other work that we do for full retail. We also offer a 5% discount if they pay up front (not available with other offers) which has increased cash flow 10 fold.
     
  33. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Leave it to the grumble to parse words to the extreme

    If a point was to be made, it ought to suggest that each of us needs to identify his market and merchandise accordingly. Our good friend David may suggest that at his meat market that while it will carry hamburger and maybe Prime meat, it won't carry Caviar.

    While that may be true at his market and it might be true for many frame shops using the same analogy, in this market we have a chain called AJ's. They most certainly will have all three. Their wine rack has $20 bottles as well as Dom Perignon

    The bad news: none of the AJ's do anywhere near the biz as any WalMart or Safeway or Fry's

    I don't know if there is a lesson there or not, but they have most definetely created the exact image they wish and they have attracted exactly the clientele, too. Their price for hamburger is nowhere near the cheapest, but still competitive

    Bottom line: There are merchandising options that will successfully blend high to low end products without either end suffering. Perhaps we ought to critique the Larson line of moulding which goes from OEM metals to what for many framers is indeed a high end offering
     
  34. shayla

    shayla WOW Framer

    This has been a really interesting conversation to listen to and think about.
     
  35. Kirstie

    Kirstie PFG, Picture Framing God

    Yes, we can identify our markets, but mine is certainly changing. Today was another reasonably busy day--lots of frames at much lower tickets than prior to this recession. Hard work for less profit.

    We do offer everything from finished corner frames to ready mades and poster specials, and everything inbetween. But the market is showing its preference right now, loud and clear.

    My concern is that after this recession is over, how will we have set ourselves up for the future. (Hey, I'll just be glad to be here.) The public like our prices and our offerings. Now they choose the bargains. Will these buying habits be set in stone for the long haul? We certainly won't eliminate these special prices and packages. Will the consumer maintian these new buying habits in the future?

    I am very grateful for the business and I am happy to give the consumer great value for the money. I just wonder how we are setting ourselves up for the future. It is these concerns which have led us to purposefully keep our poster special offerings small. If you want black wood or 15 style metal, then we have a great price for you. If you want close-outs, or value line, another very good price. Same for ready mades. But the rest of our beautiful offerings will remain at our usual everyday competitive prices.

    And are we selling upgrades on those packages? Absolutely, with almost every sale. What wants thier pictures to fade?

    If we are to remain in business we need to make sure that we are very careful with our pricing on the whole spectrum of offerings and that we advertise both equally--hamburger to filet mignon.
     
  36. Kirstie

    Kirstie PFG, Picture Framing God

    I'd like to hear more on this point, Bob. Ideas?
     
  37. PaulSF

    PaulSF PFG, Picture Framing God

    Kirstie, if you are concerned about how we are setting ourselves up for when the recession ends, you need look no farther than Christmas. For years now, retailers have offered sales in the months leading up to Christmas. The sales start out OK, maybe 10% off, and they get progressively more generous, to the point that on December 26, everything is 50% off. The customer knows this, and they wait. They wait and they wait and they wait, because they know the price is only getting better. The only risk is that the merchandise won't be there, that it will already have sold. But the fundamental lesson is that retailers have trained their customers to expect a discount, and to wait for it to get better.

    That's why I hope value packages are better than discounts. The value package is priced the way it is priced. It isn't X% off anything, at least not that the customer can see. It's just a lower priced offering, the way the Macy's store brand is lower priced than a Ralph Lauren item sold in the same store.

    Having started out with overt discounting just three years ago, I can tell you that there is a completely different customer base for discounting than there is for full-price products. Most of the customers who came in when I was discounting haven't been back since I ended the discounts. A few have, and some of them were disappointed that I wasn't giving them 50% off, and they left without placing their order. Since ending the discounting, I'm taking in fewer orders per week but making the same or more money.

    Whatever you do to survive in this recession, do not train your customers to expect discounts. Offer them more affordable options, a variety of price ranges, but do not train them to wait for the percent-off sale, unless you are prepared to jack your prices up beforehand to maintain your margins.
     
  38. Kirstie

    Kirstie PFG, Picture Framing God

    Paul, I assume your note was to everyone. You know I only discount with the monthly newsletter coupon in hand. Same policy for about 8 years. No other discounts.
     
  39. surferbill

    surferbill SGF, Supreme Grumble Framer

    Bob,
    I like the car analogy, as I think picture framers and car dealers are in the same boat.
    Both of us have a good product that people usually want, but hardly anyone is buying right now.

    More important than branding or having the right product mix is just surviving these days. IMO

    Towards that end, I've told all my staff to just "make the sale."
    I think most of us can absorb a little loss of profit, if it means paying the rent and staying in business.

    If I have to discount to make a sale, I'll discount.
    If I have to pick up and deliver a job to make the sale I'll do that too.
     
  40. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Not to beat a "meat analogy" to death, but consumers do have a "sense" of what a lb of ground beef probably sells for. Most do not have a good sense of what that Prime Rib Eye does

    Bottom line: You need to be "sharply" priced on those items that extremely "well known" while not so much on the items more desirerous and not as "well known"

    Often framers do the opposite

    How often do we charge much higher than "market" for such pedestrian things as poster specials and than reduce our markups substantially on "high end" stuff because we think it "expensive"?

    Surf- Again we are in agreement? When you repeatedly see more and more examples of "no sales" (we sure do now) do we examine the probable answer or just dismiss it to the "economy"?

    Hi Kirstie-May I ask you a question? As many times as we have talked, i do not know your pricing philosophy. Do you have a more "straight line" markup ora "sliding scale" on your POS. If a sliding scale, you do "de facto" discount. may I suggest that if a "straight line", then you do have the ability to offer a "Surf" type of one time discount to close the sale at probaly the same or better margin than the "sliding".

    It requires a little "polish" in the presentation, but I think you will have no problem. EXtending that to staff will require some training; again, with you, I see no problem. Selling at different segments does require differing selling skills
     
  41. Cliff Wilson

    Cliff Wilson SGF, Supreme Grumble Framer

    This is one I find amazing! So many of us reduce our markup on exactly the frames the customer is most likely to pay a premium for! uh?

    This is driven by the sliding scale that is published by whom? The guy that wants to sell more of the high end stuff!? So what, we should take a smaller margin so they can have a bigger one? uh?
     
  42. Jerry Ervin

    Jerry Ervin PFG, Picture Framing God

    Me too Cliff.

    I have never really embraced the 'Pricing For Profit' theory.

    Having said that, I do use a slightly sliding scale on moulding markup.
     
  43. Jay H

    Jay H PFG, Picture Framing God

    My scale don't slide much but I had a difficult time making both cheaper mouldings and more expensive mouldings make any sense at all without a sliding scale.
     
  44. Kirstie

    Kirstie PFG, Picture Framing God

    You have to do this or your would not make enough to survive on the really cheap mouldings. We also have a sliding scale of sorts to take care of this, and we have a different scale and mark up for different groups of vendors, but nothing like the LJ one. My mark up table for, say UFP would not be the same as for Roma. In addition, we add a freight set price for mouldings that we don't stock. Moreover, we have fixed prices on certain frequently used inexpensive mouldings such as the whole value line.

    On this note, See the current April issue of Traditional Home. Very nice several-page spread on art and framing. Steve McKenzie shows a whole page of examples of LJ moulding, the expensive (Concerto) and a corresponding "less expensive" variety so the consumer can see how to save money. Here's a teaser: 573235 is marked as a "Save" moulding at $28. pf. ROTFL! This is not priced this high at my shop and is certainly not a "Save" moulding. Try some at $4-6pf. Welcome to my world.
     
  45. Bob Carter

    Bob Carter SPFG, Supreme Picture Framing God

    Kirstie is correct; in the real world we ought to make some adjustments. May I suggest on things that look like we ought to charge more for, we don't. Too often, we rely upon either a static, straight line method that doesn't allow for that individual, additional mark up or the sliding scale where we rely upon a method as Cliff suggests.

    Either case is not advisable, yet, a hybrid of common sense "what it ought to sell for" method, while a little more work, is a better method. Truth is, most of us will take the easy way and lose.

    Bottom line: Find a method that works best for you. We started talking about "product mix"; this is a great example of "pricing mix"
     
  46. rubytuesday

    rubytuesday True Grumbler


    Hear Hear! well said
     
  47. CAGallery

    CAGallery MGF, Master Grumble Framer

    Thank you for the solution to one of my concerns of offering specials. We are working on our value line right now (yes, I know we are slower than most to get things done!) and I like this philosophy. A limited selection of nice value line frames and poster specials. And the rest at our every day prices.

    I am embarrassed to say that for the first time in 25 years I actually discounted twice in the past few months. I was working with customers and just wanted to finish up. However, our policy is not to discount and we absolutely do not. I ended up saying "You know what? I will personally dry mount this piece for you on my own time, after hours. We won't even put it on the receipt". I could not believe that came out of my mouth but it worked. And I felt so cheap doing that but it was several hundred dollars in our cash register. And we have to pay our bills! I am worried though about the ramifications of my actions. And I don't feel comfortable allowing my employees to do this either.
     
  48. CAGallery

    CAGallery MGF, Master Grumble Framer

    I am missing something here. Why a different mark up for different group of vendors? If you use a sliding scale wouldn't it be the same all across?

    As far as freight is concerned we add a "non stock charge" per frame rather than per foot. This way we are assured of getting our shipping covered for each chop sold.
     
  49. Kirstie

    Kirstie PFG, Picture Framing God

    Good question. It made me look at our price codes. We actually have four sliding scales. Now I have to take stock once again, because your question is relevant.

    There was a theory, but I'm not sure it makes sense. Remember, this was set up right before I left the shop for months for the knee surgery. One is for those scales is for rare companies with whom we only deal on a chop basis. One for the higher end companies like Roma and Larson, one for a group of companies whose prices are typically lower. The latter group has very slightly higher mark ups across the board. These mark ups allow for the extra work that sometimes goes into these mouldings and for the extra shipping on length orders for stock. The only way to make a graduated scale is with teeny tiny increments. We make our even smaller than the FR exmaples. Otherwise you can be caught when prices change.

    Most of our really inexpensive mouldings are accounted for with set prices in the value line.
     
  50. Kirstie

    Kirstie PFG, Picture Framing God

    Bob,

    This went over my head. Yes, we have a sliding scale to account for the high and very low. I can't see any other way to do this. I've been looking at my price codes for hours now and my brain is fried. I am trying to merge 4 sets of price codes into 2--I think--wood and metal. Probably straight line for metal, sliding for wood, excluding hand priced value line, poster, etc. My prices have to work for all my designers. What do you mean by selling at different segments? I'm lost.
     
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