I enjoyed the comments on my Get Smart (About Manufacturing) post about economy of scale. Yep, that’s what that post was about, but I tried to make it more interesting than that phrase sounds! The comments from other designers, small business owners and manufacturers illustrate how universal my experiences are. Here are a few excerpts (all links go to the authors’ blogs/websites):
I’m dealing with a similar situation domestic manufacturing vs Asia. U.S. quality is top notch and more expensive then a regular “inexpensive”/cheap Asia manufacturing. Good Asian factories charge a lot more for quality. As they say: You get what you [pay] for. — Sabina Les
Sometimes my clients ask me why a particular estate piece costs so much and I have to carefully explain that I’m actually selling it for less than what it would cost to manufacture in today’s economy. — Belle de Ville
We’re in photography in the U.K. and find that a lot of customers don’t get why prints cost so much. I think everyone tends to discount the value of labour. — Nicola
The offering of goods available worldwide is adversely affected by the economic demands created by the influence of the largest players in the market. Customers do benefit from lower prices, but at what cost? — Susan
At least a few times a week somebody tells me I should just manufacture in China, because they don’t know all of the complications, costs, and downsides to doing so. — Jesica
The Vegetable Assassin wrote about her struggles to get a fair price for her artwork, Brie wrote about her photography and Lady Smaggle wrote about her jewelry. Sara made me laugh by telling bitches, “Get your hands out of my wallet.” Ha!
To mass produce that in Asia, first of all they would cut the thickness of the ring (reducing quality). Then there would not be the depth to the engravings. (reducing the look overall) And last of all, they would not continue those engravings completely around the ring. They would only carve (maybe I should say stamp) the face of the ring.
Sher knows her shizz. She also gets at another burning question:
Why don’t you do less complicated designs that can be made for less money?
As a matter of fact, I started out with jewelry designs that were less detailed, less weighty, less ME. Unfortunately, those designs weren’t special enough to appeal to retailers, press or clients. They looked like jewelry you could find anywhere at a lower price. Back to economy of scale! Even if I made the overseas factory’s required minimum of 100 units, Walmart was making thousands so Walmart got price breaks from its factories. Walmart can sell a simple 10K gold and diamond necklace — apparently inspired by Elsa Peretti’s famous Open Heart design for Tiffany — for $57. I could never match that price even if I did the exact same design.
A few years ago, Toys R Us was nearly put out of business by Walmart’s purchasing power, which allowed it to sell it toys at lower prices. Toys R Us hired Gerald L. Storch to run the company. Storch formerly worked at Tar-Jay, another low-price chain, so he knew what he was dealing with: Toys R Us was never going be able to compete with Walmart on price. Storch decided to concentrate on getting cooler toys, like Zhu Zhu Pets hamsters. Success! I kind of want a Zhu Zhu myself.
My strategy is the same as Toys R Us. As long as I can’t make a $57 necklace, I’m going to do the coolest, heftiest, most detailed and best-made jewelry you’ve ever seen. When Walmart hires me to do a special line, I’ll do lightweight, less detailed jewelry and sell it for a song. The quality will be lower, of course, but by now you should know that you get what you pay for!
UPDATED TO ADD: Check out Denise’s wonderful post about me on The Swelle Life. Thank you, Denise!