Economic Factors and Potters
By Jeff Zamek II

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So now that we know that potters are on the tail end of the raw material economy, we should realize it's not likely that potters ever wag this dog. Instead, the best course of action is to pick and choose carefully, using "guaranteed" clays and glaze recipes whenever possible. Trouble-free glazes and clay bodies can be formulated if potters learn to use their supply and demand strengths, rather than being discouraged by choosing raw materials blindly. A little knowledge in these areas will produce better results in the pottery.

Economic Strategies for Selling Pots
How can individual potters hope to overcome high labor cost, inferior raw materials, and competition from mass-produced functional pottery? As an added condition potters are faced with all the inherent problems in financing and running a small business, many of which fail within the first five years of operation. In order to sell pots in this type of business environment much depends on a thorough understanding of the general market and its smaller niche "crafts" markets. The handmade "one of a kind" ceramic object produced by a lone craftsman does not have a large market in the United States as compared with mass produced, low priced, throwaway functional objects which can be made from metal, plastic, ceramics or paper. There is a smaller market for handmade ceramic objects, which the potter must locate and develop in order to sell profitable functional pottery.

There are several strategies that can work to reduce cost and increase profit margins. There are also several approaches to selling pottery to small specialized markets. Many potters compile a list of customers who have purchased their work in the past. A "fine tuned" mailing list of satisfied customers can be used to send out postcards and notices for upcoming shows and sales. Since the list is composed of customers who have purchased work in the past they are more likely to do so in the future. Many customers "collect" a potters work over time and look for new pots to buy in the future. If it is possible to have past and potential customers arrive at the pottery studio for a kiln opening so much the better as this technique eliminates shipping and handling costs for the potter. There is nothing more satisfying for the potter than having someone take the pots out of the studio and leave money in their place. Potters should realize this economic fact: the more you touch the pots, the more they cost to make.

Craft shows which are held in many locations throughout the country attract a wide ready made willing to buy audience of self selected customers as they are purposely looking to buy hand made objects. However, potters can fall into the trap of under pricing their pots to people who are more than willing to buy them. What such a situation provides is many labor intensively made pots selling at low profit margins. There are many reasons for a miscalculation in determining the fixed and variable costs in producing pottery. One factor is the potters reluctance to not price their work out of the market. They have not determined where their pricing falls on the supply and demand curve. More importantly they have not availed themselves of the potential increased profit margins because they worry an over priced item will not sell.

When potters devise a multi-tiered pricing policy on a specific line of pots they can possibly increase their profit margin while not giving up a sale. For example, the potter can make a casserole selling for $25.00 and another slightly modified casserole priced at $35.00. In this way the potter can test the market for a higher priced item while still giving the potential customer an opportunity to buy a pot. It is frequently noted customers need an excuse to buy and they need an excuse not to buy. By using an adaptable scale pricing structure the customer is always left with an option to buy the lower priced casserole.

A deceptive characteristic of selling handmade pottery is the low barrier to entry when starting a business. The costs of capital equipment, supplies, and raw materials are small expenditures compared to the time and labor involved in making the actual pots. Many potters find at first they can easily sell their work to friends and relatives. This selective group of "customers" is always very supportive with words of encouragement, often placing orders for new pots. At this stage potters often expand their potential market to craft shows which can bring in added revenues; however, if the potter has not carefully calculated his costs he could be working for a few cents per hour. The potter also has to compete against other potters who have mistakenly priced their pots too low. The next stage of making pottery revolves around starting a small business and not simply just turning out more pots. It is often at this higher level of business activity that potters are unable to run a business. Many pottery businesses, as with the majority of small businesses, fail within a short period of time. A more insidious development can occur when potters sell their pots over several years and suffer incremental cost increases in the production. At the end of many long months and years of manual labor (making pots) they find themselves making less money each year. This situation can be intensified if the potter is selling a greater quantity of pots that are not priced accurately. Higher production costs at increased volume of sales can equal lower net profits. A pottery business can slowly fail when there is a low or negative profit margin on some items that are sold in high volumes.

Researching the business operations of other potters and a survey of the potential market would be the first steps in starting a pottery business. Learning from other people's mistakes is less expensive than learning from your own mistakes. A business education can be a major benefit when starting any small business enterprise. Many community colleges offer business courses in advertising, bookkeeping, and marketing. The potter should take advantage of any educational opportunities and apply the concepts and skills before starting their own pottery business. While business skills will not directly translate into making better pots, they will increase the chances of the potter remaining in business so better pots can be made.

Acknowledgements:
I would like to thank Dan Belleville, of Mid-Town Motors, 151 College Highway, Southampton, MA 01073 ph 413 527 4248 for his detailed information on spark plugs.

Jim Fineman contributed valuable technical information to the article. Jim is a professional potter living in Manteo, NC.

Jeff Zamek, received B.F.A./M.F.A. degrees in ceramics from, Alfred University, College of Ceramics, NY. He taught ceramics at Simon's Rock College, Great Barrington, MA. and Keane College, Elizabeth, NJ. In 1980 he started his own ceramics consulting firm and has contributed articles to Ceramics Monthly, Pottery Making Illustrated, Clay Times, Studio Potter, and Craft Horizons. His books "What Every Pottery Should Know" $ 31.40 and "Safety in the Ceramics Studio" $ 25.95 are available from, Jeff Zamek/Ceramics Consulting Services, 6 Glendale Woods Dr., Southampton, MA 01073 web page http://www.fixpots.com, email: FIXPOTS@aol.com.

I would like to thank Jeff Zamek for making this important article available to Ceramics Today.

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