November 25, 2024 • 39 mins
With Black Friday coming up quickly and market season in full swing, should you discount your creative work? There's a time and a place for discounts. This week we go over the pros and cons of offering or granting discounts and why it is SO crucial to price your work properly in order to have more marketing flexibility in your business
This is a great episode for creatives who...
⭐️ don't know how to respond when a customer or potential customer asks for a discount
⭐️ aren't sure if discounting devalues their work
⭐️ don't feel they have the room in their pricing to offer discounts
⭐️ aren't sure how much it costs them to secure a new customer
⭐️ are looking for ways to foster loyalty among their customer base
This episode is brought to you by our Premium Subscriber Community on Patreon and Buzzsprout
MENTIONED IN THIS EPISODE:
You can find Melissa at finelimedesigns.com, finelimeillustrations.com or on Instagram @finelimedesigns.
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- Instagram at @andshelookedup
- YouTube
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And She Looked Up Creative Hour Podcast
Each week The And She Looked Up Podcast sits down with inspiring Canadian women who create for a living. We talk about their creative journeys and their best business tips, as well as the creative and business mindset issues all creative entrepreneurs struggle with. This podcast is for Canadian artists, makers and creators who want to find a way to make a living doing what they love.
Your host, Melissa Hartfiel (@finelimedesigns), left a 20 year career in corporate retail and has been happily self-employed as a working creative since 2010. She's a graphic designer, writer and illustrator as well as the co-founder of a multi-six figure a year business in the digital content space. She resides just outside of Vancouver, BC.
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Speaker 1 (00:00):
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(01:03):
And now let's get on with theshow.
Welcome to the and she Looked Uppodcast.
Each week we sit down withinspiring Canadian women who
create for a living.
(01:24):
We talk about their creativejourneys and their best business
tips, as well as the creativeand business mindset issues all
creative entrepreneurs strugglewith.
I'm your host, melissaHartfield, and after leaving a
20-year career in corporateretail, I've been happily
self-employed for 12 years.
I'm a graphic designer, anillustrator and a
multi-six-figure-a-yearentrepreneur in the digital
(01:46):
content space.
This podcast is for the artists, the makers and the creatives
who want to find a way to make aliving doing what they love.
Hello everyone, and welcome toanother episode of the and she
Looked Up podcast.
(02:07):
As always, I'm your host,melissa, and this week I'm here
to talk about discounts.
So this can be a verycontroversial topic in the
retail world, particularly inthe handmade, artisanal,
creative world.
But with Black Friday coming upquickly and Cyber Monday to
(02:30):
follow and Boxing Day afterChristmas, I thought that this
was probably a good time to havean episode about discounting
and when you should use it andwhen you shouldn't use it, and
whether you should use it at alland all the different things
that go along with discounting.
So that's what we're going tobe talking about today.
(02:51):
As I think I mentioned, thingshave been a little bit chaotic
here because I have a new studiomate and he's fast asleep right
now, which is why I amrecording.
If you're watching on YouTube.
You could have a little peek ofhim there.
If he wakes up later, maybeI'll bring him up to the camera
(03:11):
so you can see him, but he'sfinally fast asleep.
He has been on the go since8.30 this morning.
It is now three o'clock in theafternoon and I am worn out.
So yeah, it's making things alittle bit more challenging
time-wise these last few weeks.
His name is Joey and he's 16weeks old tomorrow, so he's
(03:36):
still just a wee one, and thisweek he lost a whole bunch of
teeth, so we're in the teethingstage.
If you've ever had a youngpuppy, you know what that's like
.
It's not very much fun.
The good news I am still in onepiece, even though I have
become a chew toy for him, butwe are, we're we're figuring
(03:59):
things out.
So it's been a long time sinceI've had a puppy and I forgot
how much work they are.
On that note, let's dive in tothis week's topic which, as I
mentioned, is discounting.
So there are so many differentschools of thought when it comes
to discounting and I seequestions being asked about this
(04:19):
in small biz groups all thetime.
I get asked questions aboutthis all the time and I thought
it was worth talking about.
I've also seen a lot of threadsrecently where small business
owners are getting very upset bypeople asking for discounts,
and I'm just going to say thisabout that there is nothing
(04:43):
wrong with a customer asking youfor a discount.
It doesn't mean you need to sayyes, it doesn't mean you need
to say no.
There are different ways ofhandling it that are very polite
and thoughtful and don'tnecessarily turn someone off.
Everyone has different ways ofapproaching how they spend their
(05:03):
money and for some people theyjust love to barter.
It's fun for them.
For other people it may meanthe difference between being
able to purchase from you or not, and some people are, to be
really honest, kind of justbeing jerks.
So there's a whole range ofdifferent things that are going
on, and one response that I seein these threads all the time is
(05:26):
these people would never gointo Walmart or Target or
whatever chain and ask for adiscount, and I just want to say
something that is absolute,100% BS.
I spent 20 years working inretail for a very large Canadian
chain and I can tell youabsolutely not a day went by
(05:49):
where I didn't get asked by acustomer and I was a manager, so
I was the one who got hauledout when the question got asked
if they could have a discount.
It happens all the time,everywhere and anywhere.
And here's the thing I wasauthorized to give discounts in
certain situations.
So it might be shopworn ordamaged merchandise where
(06:12):
somebody wanted a discount.
It might be that they werelooking to buy a bulk amount,
like a much larger amount thanthe average customer would
normally buy.
I'm not talking like buyingthree lipsticks instead of one.
I'm talking about maybe theywanted to buy 20 lipsticks or 20
bottles of shampoo or whateverthe case may be.
So yes, absolutely.
(06:34):
People ask for discountsanywhere that they are being
asked to hand over money inexchange for goods.
People ask and you would beshocked how many places will
consider a discount if it's theright set of circumstances.
So did I give discounts out allthe time willy-nilly?
Absolutely not, but I would sayprobably about 10% of the
(06:57):
people who asked for discountswould be given a discount
because what they were doing, itmade sense and it in many cases
became a way to bring thatperson on as a loyal customer.
So you know if somebody isgoing to come in every month and
buy 40 of something that thenormal person would maybe buy
(07:21):
one or two of in a month andthey're going to do that every
month, giving them a 10%discount.
That was worth it for us, forour margin, for our
profitability, for all of thatstuff to get that continued sale
and to move that merchandisethrough and turn it.
We don't talk about turns verymuch in the creative world, but
(07:42):
turns was a big thing when Iworked in retail.
How often you turn yourinventory?
And so, yeah, absolutely Inmany cases it was worth it and
it fostered loyalty and thatperson would come in over and
over again.
And if I can sell 40 ofsomething to one person every
(08:03):
month at a 10% discount ratherthan one at a full price, the
math worked.
So that's a key thing when itcomes to discounting.
First of all, you need to knowyour math, you need to know your
pricing and you need to know ifthe math is going to work.
But you also need to thinkabout hidden costs that we don't
(08:23):
really talk about when we'rebringing people into our
business.
How much does it cost you tobring a customer into your
business?
So I'm talking about themarketing costs.
Do you pay for Facebook ads orInstagram ads or Pinterest ads
to bring people into your world.
Do you offer a 10 to 15%discount when somebody signs up
(08:47):
for your email list, if theyfavorite something in your Etsy
shop, do you send them a couponoffering them a 10% discount?
Do you send them a thank youcoupon when they've purchased
from you for a 10% discount?
Those are all hidden marketingcosts in order to bring a
customer into your ecosystem,and then you may choose to offer
(09:08):
other promotions or discountsin order to keep them in your
ecosystem.
So is that any different thanhaving a customer actually
approach you for a discount andhaving the choice between saying
yes or no?
It's not Now.
Everyone has their own opinionabout this and you are free to
(09:28):
do whatever you want to do.
I am not, as a creative and assomebody who makes things by
hand, I'm not super crazy aboutoffering discounts.
I don't do a lot of promotionswithin my business, and when I
do and when I offer discounts,I'm very strategic about it and
(09:51):
I'm very aware of how much itcosts to bring a customer into
my business.
One of the things I didn'tmention is, if you're running
ads or you're doing pop ups oryou're doing all those kinds of
things.
It's also costs your time toput those things together and
put them into place so that youcan bring people into your
ecosystem.
So anyway, all that to say, I'mnot a huge fan.
(10:14):
I don't like training people towait for a discount, which is
what often happens, particularlyin big box retail.
We all know we get the flyersevery week for the grocery store
and for places like Shoppersand London Drugs and Canadian
Tire and all that stuff, and wekind of.
If you watch the flyers, you'llnotice that they work on a
(10:34):
cycle.
It's usually anywhere from afour to an eight week cycle and
once you kind of have an idea ofwhere things that you regularly
buy hit in those cycles, youcan plan your shopping quite
economically.
If you know peanut butter goeson sale every eight weeks, then
you only buy peanut butter everyeight weeks.
You can really watch to see andform your own strategy for
(10:58):
shopping, because that'sessentially what they're doing
is they're just training theircustomers on when to shop, and
that's something that we don'tnecessarily want to do when
we're in the creative field orwhen we are making things by
hand.
You may also choose to neverdiscount, which is totally fine,
but again, you want to think itthrough.
(11:22):
So when is it okay to discountand when is it not okay to
discount?
I like to think of it a littlebit as the art of the deal.
I think it's okay to discountin certain circumstances.
Discount in certaincircumstances One is if it's to
(11:43):
hook a customer, and that mightsound very mercenary and
corporatey, but essentially whatI'm talking about here is what
do I need to do to get somebodywho's browsing to turn them into
a purchaser?
And we've all had people likethis who follow us on social
media, or they've been on ouremail list for months and even
years and they've never made apurchase.
What do we need to do to getthem to push the button?
(12:06):
And so in those cases that'swhere we have things like, you
know, the 10 to 15% off when youjoin an email list.
An email address is a veryvaluable thing to a small
business owner, so for me, it isworth it to give them something
(12:26):
in exchange for that emailaddress.
Okay, a lot of people don'twant to give up their email
address because they're worriedthat they're going to be spammed
or it's going to be used inways that they don't like, and
so they're very careful aboutthat and they're not just going
to give it up for free.
So to me, that is a great wayto that's a great use case for a
(12:47):
discount.
I do the same thing on Etsy.
If somebody favorites one of myitems and this a lot of
shoppers use this as a strategyon Etsy.
They'll go through, they'llstart shopping for a certain
thing and they'll favorite a lotof different things and they'll
wait to see who offers them adiscount before they purchase,
and it's usually one of thepeople that offers the discount
(13:09):
that they will buy from.
So if you are pricedappropriately, then a 10%
discount should be verymanageable for you.
A 15% discount should even befairly manageable for you, and
we did this.
I just did an episode in ourpremium subscribers podcast that
(13:31):
we do just for our Patreon andBuzzsprout paid subscribers,
where we talked about gettingour products into wholesale and
the pricing strategy that youneed to use for that.
If you are pricing forwholesale which, with the new
year coming up, might besomething you really want to
consider and we will be doing awholesaling episode probably
(13:52):
early in 2025 to talk about allthe nuances of wholesale but one
of the things with wholesale is, you need to make sure that
you're priced appropriately, anda lot of us, as makers and
creatives and small businessowners, do not price ourselves
where we should.
When we price ourselves too low, it can be sending a message to
(14:14):
our potential customers that wemay not be the best quality, or
this may just be a hobby, or wekind of train them to think
that that price is okay, whenreally it's not.
You're probably not makingenough to pay yourself a decent
salary and, again, you're notleaving yourself any room to
(14:36):
build your business.
So when you're pricedappropriately and the kind of
formula for pricingappropriately is two by two, by
two and we'll get into this inanother episode If you want to
hear more about it, you can gosubscribe to our Patreon and
you'll get access to thewholesaling mini episode that I
did there last month or thismonth I've completely lost track
(14:56):
of time and you can learn moreabout it there.
That's a shameless plug forPatreon.
It's only, I think, $4 a monthCanadian, so it's very
inexpensive and it's a great wayto support the show.
But anyway, if you are pricingappropriately at the two by two,
by two method, then you aregoing to have more than enough
(15:17):
cushion to offer discounts whereit's appropriate, and bringing
people into your email list isone of those areas where I do
think it's appropriate.
If you were to pay for ads, torun ads on Facebook or Instagram
it would probably cost you morein some instances to get an
email address onto your listthan offering that 10 to 15%
(15:40):
discount if somebody justhappens to land on your website.
So that's something to thinkabout.
So, yes, in the instance oftrying to hook a customer or to
get a customer's email access orto just pull them into your
ecosystem however that may be,and an email address counts them
(16:01):
into your ecosystem, howeverthat may be, and an email
address counts, then I think adiscount is perfectly
appropriate.
It is expensive to get a newcustomer.
We don't talk about this enough, but in retail, most big
retailers know exactly how muchit costs for them to land a new
customer, and it is far moreexpensive to land a new customer
than it is to keep an existingcustomer.
(16:23):
So that is something to thinkabout, like when you think about
all the things you do on adaily basis to bring customers
in, whether it's your timemaking reels or TikToks, or it's
spending money on ads all ofthat stuff.
It's expensive to get somebodyto come in and purchase from you
.
So if there's a way that youcan make that a little bit
(16:45):
easier and bring the cost of itdown, then that is something
that I think is worth doing.
So, yes, bringing somebody intoyour ecosystem.
I do think, as mentioned at thebeginning of this episode, that
bulk orders is another placewhere it is perfectly
appropriate to offer a customera discount.
(17:08):
So when it comes to bulk orders, this is only going to apply to
some of us.
If you are making originalpieces so it's an original
painting or it's an originalcrocheted stuff, toy or
something like that, that's oneof a kind and that you're not
going to replicate, then no, Idon't think you're going to be
(17:33):
offering bulk discounts on that.
It doesn't really make sensebecause you're creating an art
piece, which is very differentIf you are doing something where
you're replicating the itemover and over again so in my
case, things like greeting cardsthat I make or stickers, or you
take that piece of original artand you turn it into prints
(17:56):
that are replicated over andover again.
In those instances, a bulkorder and offering a discount or
giving somebody a discount fora bulk order makes sense.
Again, bulk orders are not thesame as wholesale orders.
A wholesale order, you're goingto be giving that person a 50%
discount off of your retailprice and again we get into that
(18:17):
in the pricing that we talkedabout in the subscriber only
episode.
We're not talking about thatkind of discount here for a bulk
order.
For a bulk order it could be10%, it could be 15%.
If it's a really large order itmight even be 20%.
And those you're still making aprofit.
But you are moving more productwhich, carrying large amounts
(18:41):
of product, has its own costsattached to it, which is one of
the reasons why big retail willoffer bulk discounts, if you ask
nicely, because they want tomove that inventory quickly.
Having large amounts ofinventory on hand is very
expensive for retailers and itcan be expensive for us too.
It takes up space, it getsshopworn.
(19:03):
Even if it's sitting in yourstudio in a nice box, it still
becomes aged and there gets tobe a point where you can't sell
it for full price anyway.
So if you can move a bulkquantity, then that is an
opportunity worth exploring.
And you get to decide what thatbulk order is.
(19:25):
It could be they need to order10 of an item or they need to
order 20 of an item.
Think about it when you buy yourraw materials, like for me,
when I buy my cardstock or mysticker paper.
If I order 10 sheets of stickerpaper and my paper supplier
does that, they will send you 10sheets.
It's really expensive.
If I order 2000 sheets ofsticker paper, I get a big
(19:46):
discount and it helps bring mycosts down and means that I can
sell my stickers for less money.
So I can pass that on if Ichoose to so think about it like
that.
If I choose to so think aboutit like that, you're getting
rewarded for buying more, and so, yes, it's up to you to decide
what that number is For me.
You know, I have some bundleswhere if people buy three or
(20:15):
four or five of something, theyget a small discount.
And if somebody were toapproach me and want to buy, say
I don't know, say a hotelapproached me and wanted to buy
50 of my prints to put in theirrooms, I would be more than
willing to discuss a discountwith them for a bulk purchase.
It's not a wholesale purchase,they're not getting it at the
wholesale cost, they're gettingit at a bulk discount cost Two
(20:38):
different things, so that'ssomething to keep in mind.
Another instance and I kind ofjust alluded to it where I think
discounting is okay is bundling, and you don't need to discount
product to bundle it, but it isa way that you can offer a
discount quite easily.
(20:58):
And one of the things that Ifound I started doing this with
my sticker sheets after doing alot of number crunching which
was not fun for me because Idon't like math and I'm not very
good at it, but I did a lot ofnumber crunching and what I
realized is that when I make onesticker sheet and somebody buys
it and I ship it off to them,it is actually more expensive
(21:24):
than if that person were to buythree sticker sheets from me or
five sticker sheets from me andI was to package it up and
bundle it and send it off.
One sticker sheet requires oneenvelope, one set of packaging,
my time to package it all up.
I can take five of those sheetsand send them to the same
(21:46):
person and instead of having toput them in five separate
envelopes to five separatepeople, now I'm just using one
envelope for five sheets.
My production time has cut downbecause I'm making more.
In the same amount of time.
I can make three sticker sheetsin one go and so my costs start
to come down.
So when I actually looked at itand started doing the
(22:09):
calculations and I went reallydeep on this to sell five
sticker sheets to somebody at aconsiderable discount, my actual
profit dollars and profitmargin that I'm making are
higher than when I sell a singlesticker sheet.
So even though they're gettinga discount, I'm making more
money.
So it's a really worthwhileexercise and it's very
(22:30):
counterintuitive because wedon't necessarily think of it
that way but to go through andactually crunch your numbers and
figure out how much does itcost me to make one of these?
How much does it cost me tomake five of them?
How much does it cost me tomake 10 all in one go?
How much does it cost me topackage each one?
What does it cost if I packagefive of them together All those
types of things and figure outif bundling is something that
(22:55):
you can do where you can offer adiscount and still make your
profit margin.
The other bonus with bundlingis you're raising your average
order value, which we talkedabout in an episode earlier this
season and on how that can windup adding to your bottom line
very easily.
So I'm a big fan of bundles.
You can also create bundles andnot offer a discount.
(23:18):
So I'm a big fan of bundles.
You can also create bundles andnot offer a discount.
But I find people are much moreprimed to buy when they feel
like they're getting a deal.
Everyone loves a good deal,right?
We know that Black Friday iscoming up.
Everybody's out looking for ahot deal.
And that brings me to one ofthe other circumstances where I
think it's okay to offer a greatdeal, and this is or offer a
(23:42):
discount, and this is specialevents.
So special events might bethings like Black Friday, cyber
Monday, boxing Day.
Maybe you have a customerappreciation sale once a year.
You might also offer a discountto customers on their birthday
if that's information youcollect when they sign up for
(24:03):
your email list.
There are a lot of differentuse cases where it can be very
useful to offer a discount, andI got the idea for this episode.
Actually, today I was reading aquestion in a group that I'm in
where somebody had made amistake.
(24:25):
I think they'd made a mistakeselling something to a customer
the customer.
I think the product was brokenor something I can't remember.
Anyway, the customer wanted toreturn it or something, so she
returned it and or offered herdiscount on it.
I can't remember all thedetails.
But then the customer came backand wanted to buy more of that
(24:48):
item, in a much larger quantity,and was looking for a bulk
discount.
And the person was very unsureof whether or not to do this.
And think of it was the personhad already been hooked by good
customer service.
There had been an issue.
She had solved it successfullyand made the customer feel good
about it.
And now the customer was comingback and saying hey, I really
(25:09):
loved the way you handled that.
I'm here to buy even more.
Can you give me a deal?
Now?
She had the option of whetherto say yes or no and it was
completely up to her.
But if it had been me, I wouldhave said yes, because this is a
person who I have started tocreate a relationship with on
the right foot.
They're already impressed withhow I've handled things.
(25:32):
They want to spend more moneywith me and who knows what
she'll want to buy next.
So in that instance I probablywould have offered a 10%
discount.
If she hadn't asked, I probablywouldn't have offered.
And this is another thing tothink about when you're doing
discounting.
You don't need to offer adiscount.
Some people are more thanwilling to pay full price and
(25:53):
never ask you for a discount,and we love those customers.
I have customers who absolutelyignore any attempt I make to
offer them a discount, and welove those customers.
I have customers who absolutelyignore any attempt I make to
offer them a discount or a salebecause they want to support me
fully and pay the full price.
I love those people, we alllove those people.
But I'm also very happy toreward loyalty and to nurture a
(26:17):
relationship in its infancy andmake that person feel special
and appreciated.
And for me, because I do,generally speaking for most
items priced for wholesale, a10% discount is something that I
can handle.
Can I do it every single time?
Not if they're just buying oneor two things.
No, I can't and no, I wouldn't.
But can I do it in instanceswhere they're buying a large
(26:39):
quantity or where it may be avery special occasion?
Yes, I can.
There are also non-discount ways.
You can reward a customer.
You can throw some bonus itemsin.
You can if they order, say,order three dozen of something,
maybe you throw in an extra sixor something like that.
(27:02):
It really depends.
I mean, we all know what abaker's dozen is.
Right, it's where you order 12,but the baker gives you an
extra one for free.
A baker's dozen is 13, not 12.
And that's where that came from.
It was just an opportunity toreward something where that came
(27:23):
from.
It was just an opportunity toreward something.
When I was a kid, my parentsused to take us out into the
Fraser Valley to do fresh veggieshopping at one of the farm
stands, and every time we wouldcome home my parents would take
all their veggies out of thebags and there would always be
an extra something in there thatthe owner had tossed in when my
parents hadn't noticed, as athank you.
(27:43):
So it might've been an extrathing of carrots, or it might've
been a couple of extra apples,or just something to say, hey,
thanks.
And in a way that is a discount.
You are giving them freeproduct.
You're just not calling it adiscount, but in a way it is.
So there's lots of differentways to build loyalty and this
is where discounting, if doneappropriately, can help with
(28:06):
that.
There are times where I wouldnot give a discount.
I think a lot of it depends onhow a person asks.
I think a lot of it depends onhow a person asks.
There are people who areincredibly rude about how they
ask for a cheaper price and Idon't have time for that.
(28:26):
If you are going to ask in away that devalues my work, no,
you're not.
I'm just not going to give youa discount out of ornery.
It's not going to happen.
But if somebody is very politeabout it and comes to me and
says I really love this, um, Iwould really like to purchase a
larger amount.
Is there a way that you cangive me a better price?
(28:48):
Yes, let's have a conversation.
But if it's somebody who comesup and says, um, I want to buy
this, can you give me a betterprice?
Like, and it's just one item,can you give me a better price?
Like, and it's just one item?
No, I'm not going to do it forone item.
If they offer to pay cash, Imight give them a small discount
, a 5% discount, if they paycash.
(29:09):
So all of that to say is thatdiscounting has its place.
It's not something to turn yournose up at, and it's generally
not something to get angry whenpeople ask if they can have a
discount.
As I said, depends on how theyask and what the situation is,
(29:30):
but it definitely has its placein retail, even for us as makers
and creatives.
You need to think about what iscosting you, as I said, to
bring that person into yourecosystem, and you need to think
about what is costing you, as Isaid, to bring that person into
your ecosystem.
And you need to think about,you really need to know your
pricing.
At the end of the day, it isvery hard for us to make good
(29:50):
business decisions if we do notknow the ins and outs of our
pricing.
And I can't stress this enough.
Your pricing is not just thecost of materials, it is not
just your time.
It is so much more than thosetwo things.
There is your overhead.
There is what it would cost ifyou were to hire an employee.
There's your insurance, whichis part of your overhead.
(30:13):
There's spoilage, especially ina handmade business.
How many times have you gone tolike, in my case, printing a
sheet of stickers?
I can't tell you.
How many times have you gone tolike, in my case, printing a
sheet of stickers?
I can't tell you how many timesI've printed a sheet and it's
been garbage and I've had tocheck it out.
That's spoilage.
I have to build that into mycost.
Am I priced for wholesale?
In most instances, yes, I am.
The key is your pricing.
(30:34):
You really need to know yourpricing, the ins and outs of
your pricing, and make sure thatyou're priced appropriately.
And, as I said at the beginning, most of us are not.
Most of us are priced far toolow.
This can be a really easywormhole to fall into,
particularly if you're on Etsy,where so many things are priced
for a race to the bottom, and Ithink it's really important to
(30:57):
remember that on Etsy and atsmaller craft markets and things
where you have cottagebusinesses in there, in many
instances those are people whodo this as a hobby and they are
pricing their work in order tojust make enough to cover the
cost of their materials and buymore materials because they love
what they do, whether it'scrocheting or paper making or
(31:22):
any of those things bakinggoodies to sell.
And so you have to decidewhether or not you are going to
price yourself as if this is ahobby or as if this is a
business that is going to payyour bills, and if you are
pricing it as a business that'sgoing to pay your bills, and if
you are pricing it as a businessthat's going to pay your bills,
then you should have room tooffer discounts when it is
(31:45):
appropriate.
So my general rules that I go byis I do not do anything that I
think will train my customers toexpect deals from me on a
regular basis.
I have one sale every year formy newsletter subscribers only.
It's the best deal that I offerthe entire year.
I run it usually the weekbefore Black Friday.
(32:08):
Um, I'm not running it thisyear because of the Canada Post
strike, which I'm sure for manyof you is a whole thing.
Um, not the best of timing, but, but I know that my letter
carrier for sure deserves araise, so I am with them on this
, but the timing is veryunfortunate for a lot of us
(32:30):
small business owners.
So, anyway, all that to say yes, you need to know your pricing,
you need to be able to get yourwork out there and decide when
it's appropriate.
But yeah, you don't want totrain your customers to expect a
sale from you every week.
I would rather offer one greatsale a year and then have some
(32:51):
flexibility to offer discountsor grant discounts when an
appropriate situation arises,instead of doing a sale every
three weeks or four weeks.
Yeah, so that is kind of where Istand on it and I think you
really need to, like I said,think it through when somebody
is asking you.
(33:11):
I know that for a lot of us itcan be very emotional when
somebody asks for a discount andwe feel like they're
disrespecting our work and insome cases that is true and,
like I said, in those cases it'sa flat no from me.
But in some instances it's notmeant to be disrespectful.
It's just somebody trying tomaybe be able to buy from you
(33:34):
when they otherwise might not beable to.
Or maybe, like I said, they'relooking to form a bigger
relationship where they arepurchasing regularly from you in
a larger quantity, those typesof things.
So think it through, know yourpricing and decide what your
rules will be.
Will you offer a friends andfamily discount?
(33:56):
I know a lot of people who dothis.
If you're a friend or a familymember, you ought to get an
automatic discount when youpurchase.
It's kind of cool that we runour own businesses and we get to
make these decisions.
What I will caution against isif somebody asks for a discount
and you are not willing to giveone, think about that person.
(34:19):
They are still a potentialpotential customer.
Unless they're a real jerk,then do you want them as a
customer?
Probably not, but in manyinstances they are still a
potential customer.
So respond to them in a waythat shows that you value them
as a potential customer, butthat you are not in a position
(34:39):
at this time to offer them whatthey're asking for.
And there's so many differentways you can respond to this.
It could be something as simpleas I'm really sorry, but at
this time of year, that is thebest price that we can do.
Or you can say something likeno, but if you would like to
join my email list, I would behappy to give you a 10% discount
, but otherwise I'm not able to.
(35:01):
Or you could say something likeno, but we are going to be
having a Black Friday sale onthis day on our website.
You are welcome to shop then.
We're going to be having somegreat deals on the site then and
just redirect.
Another thing that that last onethere just made me think of is
(35:24):
when you know you're going to beholding a sale in a few days
and somebody asked for adiscount on that item earlier.
Do you really want to say noand turn them away and then have
them come along a few dayslater and see that the item is
on sale?
Like you know, sometimes youhave to think about whether it's
(35:44):
worth it, like would it just beworth it to just give them the
discount now and let them knowthat that's the reason why and
say you could say something likeyou know what, this is going to
be on sale for 30% off forBlack Friday in two days, but I
know we're here in person atthis market so, if you would
like, I can offer you 15% off or30% off, or you can wait to
(36:06):
shop the Black Friday sale.
You know there's different waysyou can handle it and I think
that's kind of the key here isyou want to make the person feel
valued but still stand yourground, and there's ways that
you can do that that are politeand respectful of their
situation and still keep them assomebody who may potentially
(36:28):
buy from you.
They may even come back at theend of the show or wherever it
is that you're talking to themand purchase.
Maybe they need to think aboutit a little bit.
Yeah, so, anyway, all that tosay, with Black Friday coming up
, you don't need to participateif you don't want to.
Um, if you do want to go for it, there are other ways you can
(36:52):
offer discounts.
There are other ways you cangive people a deal.
There are other ways that youcan reward loyalty.
And again, it's all up to you.
You're the business owner, youget to make the decisions, and
that's all I have to say thisweek.
So that's it for this week.
I hope those of you who aredoing anything for Black Friday,
cyber Monday or Boxing Day Ihope that you have a successful
(37:14):
sale.
I know it is really rough outthere this year.
I've heard so many stories frompeople who are really
struggling and who are just notgetting the sales this year that
they need.
So I hope that maybe a smalldiscount would help you get over
that rough hump.
Maybe doing a Black Friday salewill help you get there.
(37:34):
That's what Black Friday wasall about originally.
It was called Black Fridaybecause it was the Friday of the
year, or it was the day of theyear where businesses went from
running in the red to running inthe black for the year, and
that's often how long it wouldtake some businesses to get out
of the red.
It would take them until theend of November.
So if you look at it that way,then maybe the Black Friday is
(37:58):
what you need what you need thisyear, I don't know.
Anyway, it is rough out there.
I hope it.
Um, I hope you're all having agood, successful holiday season,
and that's it for this week.
I'll be back in another twoweeks with another brand new
episode and we'll talk to youall then.
Thank you so much for joining usfor the Anchi Looked Up
(38:19):
Creative Hour.
If you're looking for links orresources mentioned in this
episode, you can find detailedshow notes on our website at
andshelookedupcom.
While you're there, be sure tosign up for our newsletter for
more business tips, profiles ofinspiring Canadian creative
women and so much more.
If you enjoyed this episode,please be sure to subscribe to
(38:39):
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(01:03):
And now let's get on with theshow.
Welcome to the and she Looked Uppodcast.
Each week we sit down withinspiring Canadian women who
create for a living.
(01:24):
We talk about their creativejourneys and their best business
tips, as well as the creativeand business mindset issues all
creative entrepreneurs strugglewith.
I'm your host, melissaHartfield, and after leaving a
20-year career in corporateretail, I've been happily
self-employed for 12 years.
I'm a graphic designer, anillustrator and a
multi-six-figure-a-yearentrepreneur in the digital
(01:46):
content space.
This podcast is for the artists, the makers and the creatives
who want to find a way to make aliving doing what they love.
Hello everyone, and welcome toanother episode of the and she
Looked Up podcast.
(02:07):
As always, I'm your host,melissa, and this week I'm here
to talk about discounts.
So this can be a verycontroversial topic in the
retail world, particularly inthe handmade, artisanal,
creative world.
But with Black Friday coming upquickly and Cyber Monday to
(02:30):
follow and Boxing Day afterChristmas, I thought that this
was probably a good time to havean episode about discounting
and when you should use it andwhen you shouldn't use it, and
whether you should use it at alland all the different things
that go along with discounting.
So that's what we're going tobe talking about today.
(02:51):
As I think I mentioned, thingshave been a little bit chaotic
here because I have a new studiomate and he's fast asleep right
now, which is why I amrecording.
If you're watching on YouTube.
You could have a little peek ofhim there.
If he wakes up later, maybeI'll bring him up to the camera
(03:11):
so you can see him, but he'sfinally fast asleep.
He has been on the go since8.30 this morning.
It is now three o'clock in theafternoon and I am worn out.
So yeah, it's making things alittle bit more challenging
time-wise these last few weeks.
His name is Joey and he's 16weeks old tomorrow, so he's
(03:36):
still just a wee one, and thisweek he lost a whole bunch of
teeth, so we're in the teethingstage.
If you've ever had a youngpuppy, you know what that's like
.
It's not very much fun.
The good news I am still in onepiece, even though I have
become a chew toy for him, butwe are, we're we're figuring
(03:59):
things out.
So it's been a long time sinceI've had a puppy and I forgot
how much work they are.
On that note, let's dive in tothis week's topic which, as I
mentioned, is discounting.
So there are so many differentschools of thought when it comes
to discounting and I seequestions being asked about this
(04:19):
in small biz groups all thetime.
I get asked questions aboutthis all the time and I thought
it was worth talking about.
I've also seen a lot of threadsrecently where small business
owners are getting very upset bypeople asking for discounts,
and I'm just going to say thisabout that there is nothing
(04:43):
wrong with a customer asking youfor a discount.
It doesn't mean you need to sayyes, it doesn't mean you need
to say no.
There are different ways ofhandling it that are very polite
and thoughtful and don'tnecessarily turn someone off.
Everyone has different ways ofapproaching how they spend their
(05:03):
money and for some people theyjust love to barter.
It's fun for them.
For other people it may meanthe difference between being
able to purchase from you or not, and some people are, to be
really honest, kind of justbeing jerks.
So there's a whole range ofdifferent things that are going
on, and one response that I seein these threads all the time is
(05:26):
these people would never gointo Walmart or Target or
whatever chain and ask for adiscount, and I just want to say
something that is absolute,100% BS.
I spent 20 years working inretail for a very large Canadian
chain and I can tell youabsolutely not a day went by
(05:49):
where I didn't get asked by acustomer and I was a manager, so
I was the one who got hauledout when the question got asked
if they could have a discount.
It happens all the time,everywhere and anywhere.
And here's the thing I wasauthorized to give discounts in
certain situations.
So it might be shopworn ordamaged merchandise where
(06:12):
somebody wanted a discount.
It might be that they werelooking to buy a bulk amount,
like a much larger amount thanthe average customer would
normally buy.
I'm not talking like buyingthree lipsticks instead of one.
I'm talking about maybe theywanted to buy 20 lipsticks or 20
bottles of shampoo or whateverthe case may be.
So yes, absolutely.
(06:34):
People ask for discountsanywhere that they are being
asked to hand over money inexchange for goods.
People ask and you would beshocked how many places will
consider a discount if it's theright set of circumstances.
So did I give discounts out allthe time willy-nilly?
Absolutely not, but I would sayprobably about 10% of the
(06:57):
people who asked for discountswould be given a discount
because what they were doing, itmade sense and it in many cases
became a way to bring thatperson on as a loyal customer.
So you know if somebody isgoing to come in every month and
buy 40 of something that thenormal person would maybe buy
(07:21):
one or two of in a month andthey're going to do that every
month, giving them a 10%discount.
That was worth it for us, forour margin, for our
profitability, for all of thatstuff to get that continued sale
and to move that merchandisethrough and turn it.
We don't talk about turns verymuch in the creative world, but
(07:42):
turns was a big thing when Iworked in retail.
How often you turn yourinventory?
And so, yeah, absolutely Inmany cases it was worth it and
it fostered loyalty and thatperson would come in over and
over again.
And if I can sell 40 ofsomething to one person every
(08:03):
month at a 10% discount ratherthan one at a full price, the
math worked.
So that's a key thing when itcomes to discounting.
First of all, you need to knowyour math, you need to know your
pricing and you need to know ifthe math is going to work.
But you also need to thinkabout hidden costs that we don't
(08:23):
really talk about when we'rebringing people into our
business.
How much does it cost you tobring a customer into your
business?
So I'm talking about themarketing costs.
Do you pay for Facebook ads orInstagram ads or Pinterest ads
to bring people into your world.
Do you offer a 10 to 15%discount when somebody signs up
(08:47):
for your email list, if theyfavorite something in your Etsy
shop, do you send them a couponoffering them a 10% discount?
Do you send them a thank youcoupon when they've purchased
from you for a 10% discount?
Those are all hidden marketingcosts in order to bring a
customer into your ecosystem,and then you may choose to offer
(09:08):
other promotions or discountsin order to keep them in your
ecosystem.
So is that any different thanhaving a customer actually
approach you for a discount andhaving the choice between saying
yes or no?
It's not Now.
Everyone has their own opinionabout this and you are free to
(09:28):
do whatever you want to do.
I am not, as a creative and assomebody who makes things by
hand, I'm not super crazy aboutoffering discounts.
I don't do a lot of promotionswithin my business, and when I
do and when I offer discounts,I'm very strategic about it and
(09:51):
I'm very aware of how much itcosts to bring a customer into
my business.
One of the things I didn'tmention is, if you're running
ads or you're doing pop ups oryou're doing all those kinds of
things.
It's also costs your time toput those things together and
put them into place so that youcan bring people into your
ecosystem.
So anyway, all that to say, I'mnot a huge fan.
(10:14):
I don't like training people towait for a discount, which is
what often happens, particularlyin big box retail.
We all know we get the flyersevery week for the grocery store
and for places like Shoppersand London Drugs and Canadian
Tire and all that stuff, and wekind of.
If you watch the flyers, you'llnotice that they work on a
(10:34):
cycle.
It's usually anywhere from afour to an eight week cycle and
once you kind of have an idea ofwhere things that you regularly
buy hit in those cycles, youcan plan your shopping quite
economically.
If you know peanut butter goeson sale every eight weeks, then
you only buy peanut butter everyeight weeks.
You can really watch to see andform your own strategy for
(10:58):
shopping, because that'sessentially what they're doing
is they're just training theircustomers on when to shop, and
that's something that we don'tnecessarily want to do when
we're in the creative field orwhen we are making things by
hand.
You may also choose to neverdiscount, which is totally fine,
but again, you want to think itthrough.
(11:22):
So when is it okay to discountand when is it not okay to
discount?
I like to think of it a littlebit as the art of the deal.
I think it's okay to discountin certain circumstances.
Discount in certaincircumstances One is if it's to
(11:43):
hook a customer, and that mightsound very mercenary and
corporatey, but essentially whatI'm talking about here is what
do I need to do to get somebodywho's browsing to turn them into
a purchaser?
And we've all had people likethis who follow us on social
media, or they've been on ouremail list for months and even
years and they've never made apurchase.
What do we need to do to getthem to push the button?
(12:06):
And so in those cases that'swhere we have things like, you
know, the 10 to 15% off when youjoin an email list.
An email address is a veryvaluable thing to a small
business owner, so for me, it isworth it to give them something
(12:26):
in exchange for that emailaddress.
Okay, a lot of people don'twant to give up their email
address because they're worriedthat they're going to be spammed
or it's going to be used inways that they don't like, and
so they're very careful aboutthat and they're not just going
to give it up for free.
So to me, that is a great wayto that's a great use case for a
(12:47):
discount.
I do the same thing on Etsy.
If somebody favorites one of myitems and this a lot of
shoppers use this as a strategyon Etsy.
They'll go through, they'llstart shopping for a certain
thing and they'll favorite a lotof different things and they'll
wait to see who offers them adiscount before they purchase,
and it's usually one of thepeople that offers the discount
(13:09):
that they will buy from.
So if you are pricedappropriately, then a 10%
discount should be verymanageable for you.
A 15% discount should even befairly manageable for you, and
we did this.
I just did an episode in ourpremium subscribers podcast that
(13:31):
we do just for our Patreon andBuzzsprout paid subscribers,
where we talked about gettingour products into wholesale and
the pricing strategy that youneed to use for that.
If you are pricing forwholesale which, with the new
year coming up, might besomething you really want to
consider and we will be doing awholesaling episode probably
(13:52):
early in 2025 to talk about allthe nuances of wholesale but one
of the things with wholesale is, you need to make sure that
you're priced appropriately, anda lot of us, as makers and
creatives and small businessowners, do not price ourselves
where we should.
When we price ourselves too low, it can be sending a message to
(14:14):
our potential customers that wemay not be the best quality, or
this may just be a hobby, or wekind of train them to think
that that price is okay, whenreally it's not.
You're probably not makingenough to pay yourself a decent
salary and, again, you're notleaving yourself any room to
(14:36):
build your business.
So when you're pricedappropriately and the kind of
formula for pricingappropriately is two by two, by
two and we'll get into this inanother episode If you want to
hear more about it, you can gosubscribe to our Patreon and
you'll get access to thewholesaling mini episode that I
did there last month or thismonth I've completely lost track
(14:56):
of time and you can learn moreabout it there.
That's a shameless plug forPatreon.
It's only, I think, $4 a monthCanadian, so it's very
inexpensive and it's a great wayto support the show.
But anyway, if you are pricingappropriately at the two by two,
by two method, then you aregoing to have more than enough
(15:17):
cushion to offer discounts whereit's appropriate, and bringing
people into your email list isone of those areas where I do
think it's appropriate.
If you were to pay for ads, torun ads on Facebook or Instagram
it would probably cost you morein some instances to get an
email address onto your listthan offering that 10 to 15%
(15:40):
discount if somebody justhappens to land on your website.
So that's something to thinkabout.
So, yes, in the instance oftrying to hook a customer or to
get a customer's email access orto just pull them into your
ecosystem however that may be,and an email address counts them
(16:01):
into your ecosystem, howeverthat may be, and an email
address counts, then I think adiscount is perfectly
appropriate.
It is expensive to get a newcustomer.
We don't talk about this enough, but in retail, most big
retailers know exactly how muchit costs for them to land a new
customer, and it is far moreexpensive to land a new customer
than it is to keep an existingcustomer.
(16:23):
So that is something to thinkabout, like when you think about
all the things you do on adaily basis to bring customers
in, whether it's your timemaking reels or TikToks, or it's
spending money on ads all ofthat stuff.
It's expensive to get somebodyto come in and purchase from you
.
So if there's a way that youcan make that a little bit
(16:45):
easier and bring the cost of itdown, then that is something
that I think is worth doing.
So, yes, bringing somebody intoyour ecosystem.
I do think, as mentioned at thebeginning of this episode, that
bulk orders is another placewhere it is perfectly
appropriate to offer a customera discount.
(17:08):
So when it comes to bulk orders, this is only going to apply to
some of us.
If you are making originalpieces so it's an original
painting or it's an originalcrocheted stuff, toy or
something like that, that's oneof a kind and that you're not
going to replicate, then no, Idon't think you're going to be
(17:33):
offering bulk discounts on that.
It doesn't really make sensebecause you're creating an art
piece, which is very differentIf you are doing something where
you're replicating the itemover and over again so in my
case, things like greeting cardsthat I make or stickers, or you
take that piece of original artand you turn it into prints
(17:56):
that are replicated over andover again.
In those instances, a bulkorder and offering a discount or
giving somebody a discount fora bulk order makes sense.
Again, bulk orders are not thesame as wholesale orders.
A wholesale order, you're goingto be giving that person a 50%
discount off of your retailprice and again we get into that
(18:17):
in the pricing that we talkedabout in the subscriber only
episode.
We're not talking about thatkind of discount here for a bulk
order.
For a bulk order it could be10%, it could be 15%.
If it's a really large order itmight even be 20%.
And those you're still making aprofit.
But you are moving more productwhich, carrying large amounts
(18:41):
of product, has its own costsattached to it, which is one of
the reasons why big retail willoffer bulk discounts, if you ask
nicely, because they want tomove that inventory quickly.
Having large amounts ofinventory on hand is very
expensive for retailers and itcan be expensive for us too.
It takes up space, it getsshopworn.
(19:03):
Even if it's sitting in yourstudio in a nice box, it still
becomes aged and there gets tobe a point where you can't sell
it for full price anyway.
So if you can move a bulkquantity, then that is an
opportunity worth exploring.
And you get to decide what thatbulk order is.
(19:25):
It could be they need to order10 of an item or they need to
order 20 of an item.
Think about it when you buy yourraw materials, like for me,
when I buy my cardstock or mysticker paper.
If I order 10 sheets of stickerpaper and my paper supplier
does that, they will send you 10sheets.
It's really expensive.
If I order 2000 sheets ofsticker paper, I get a big
(19:46):
discount and it helps bring mycosts down and means that I can
sell my stickers for less money.
So I can pass that on if Ichoose to so think about it like
that.
If I choose to so think aboutit like that, you're getting
rewarded for buying more, and so, yes, it's up to you to decide
what that number is For me.
You know, I have some bundleswhere if people buy three or
(20:15):
four or five of something, theyget a small discount.
And if somebody were toapproach me and want to buy, say
I don't know, say a hotelapproached me and wanted to buy
50 of my prints to put in theirrooms, I would be more than
willing to discuss a discountwith them for a bulk purchase.
It's not a wholesale purchase,they're not getting it at the
wholesale cost, they're gettingit at a bulk discount cost Two
(20:38):
different things, so that'ssomething to keep in mind.
Another instance and I kind ofjust alluded to it where I think
discounting is okay is bundling, and you don't need to discount
product to bundle it, but it isa way that you can offer a
discount quite easily.
(20:58):
And one of the things that Ifound I started doing this with
my sticker sheets after doing alot of number crunching which
was not fun for me because Idon't like math and I'm not very
good at it, but I did a lot ofnumber crunching and what I
realized is that when I make onesticker sheet and somebody buys
it and I ship it off to them,it is actually more expensive
(21:24):
than if that person were to buythree sticker sheets from me or
five sticker sheets from me andI was to package it up and
bundle it and send it off.
One sticker sheet requires oneenvelope, one set of packaging,
my time to package it all up.
I can take five of those sheetsand send them to the same
(21:46):
person and instead of having toput them in five separate
envelopes to five separatepeople, now I'm just using one
envelope for five sheets.
My production time has cut downbecause I'm making more.
In the same amount of time.
I can make three sticker sheetsin one go and so my costs start
to come down.
So when I actually looked at itand started doing the
(22:09):
calculations and I went reallydeep on this to sell five
sticker sheets to somebody at aconsiderable discount, my actual
profit dollars and profitmargin that I'm making are
higher than when I sell a singlesticker sheet.
So even though they're gettinga discount, I'm making more
money.
So it's a really worthwhileexercise and it's very
(22:30):
counterintuitive because wedon't necessarily think of it
that way but to go through andactually crunch your numbers and
figure out how much does itcost me to make one of these?
How much does it cost me tomake five of them?
How much does it cost me tomake 10 all in one go?
How much does it cost me topackage each one?
What does it cost if I packagefive of them together All those
types of things and figure outif bundling is something that
(22:55):
you can do where you can offer adiscount and still make your
profit margin.
The other bonus with bundlingis you're raising your average
order value, which we talkedabout in an episode earlier this
season and on how that can windup adding to your bottom line
very easily.
So I'm a big fan of bundles.
You can also create bundles andnot offer a discount.
(23:18):
So I'm a big fan of bundles.
You can also create bundles andnot offer a discount.
But I find people are much moreprimed to buy when they feel
like they're getting a deal.
Everyone loves a good deal,right?
We know that Black Friday iscoming up.
Everybody's out looking for ahot deal.
And that brings me to one ofthe other circumstances where I
think it's okay to offer a greatdeal, and this is or offer a
(23:42):
discount, and this is specialevents.
So special events might bethings like Black Friday, cyber
Monday, boxing Day.
Maybe you have a customerappreciation sale once a year.
You might also offer a discountto customers on their birthday
if that's information youcollect when they sign up for
(24:03):
your email list.
There are a lot of differentuse cases where it can be very
useful to offer a discount, andI got the idea for this episode.
Actually, today I was reading aquestion in a group that I'm in
where somebody had made amistake.
(24:25):
I think they'd made a mistakeselling something to a customer
the customer.
I think the product was brokenor something I can't remember.
Anyway, the customer wanted toreturn it or something, so she
returned it and or offered herdiscount on it.
I can't remember all thedetails.
But then the customer came backand wanted to buy more of that
(24:48):
item, in a much larger quantity,and was looking for a bulk
discount.
And the person was very unsureof whether or not to do this.
And think of it was the personhad already been hooked by good
customer service.
There had been an issue.
She had solved it successfullyand made the customer feel good
about it.
And now the customer was comingback and saying hey, I really
(25:09):
loved the way you handled that.
I'm here to buy even more.
Can you give me a deal?
Now?
She had the option of whetherto say yes or no and it was
completely up to her.
But if it had been me, I wouldhave said yes, because this is a
person who I have started tocreate a relationship with on
the right foot.
They're already impressed withhow I've handled things.
(25:32):
They want to spend more moneywith me and who knows what
she'll want to buy next.
So in that instance I probablywould have offered a 10%
discount.
If she hadn't asked, I probablywouldn't have offered.
And this is another thing tothink about when you're doing
discounting.
You don't need to offer adiscount.
Some people are more thanwilling to pay full price and
(25:53):
never ask you for a discount,and we love those customers.
I have customers who absolutelyignore any attempt I make to
offer them a discount, and welove those customers.
I have customers who absolutelyignore any attempt I make to
offer them a discount or a salebecause they want to support me
fully and pay the full price.
I love those people, we alllove those people.
But I'm also very happy toreward loyalty and to nurture a
(26:17):
relationship in its infancy andmake that person feel special
and appreciated.
And for me, because I do,generally speaking for most
items priced for wholesale, a10% discount is something that I
can handle.
Can I do it every single time?
Not if they're just buying oneor two things.
No, I can't and no, I wouldn't.
But can I do it in instanceswhere they're buying a large
(26:39):
quantity or where it may be avery special occasion?
Yes, I can.
There are also non-discount ways.
You can reward a customer.
You can throw some bonus itemsin.
You can if they order, say,order three dozen of something,
maybe you throw in an extra sixor something like that.
(27:02):
It really depends.
I mean, we all know what abaker's dozen is.
Right, it's where you order 12,but the baker gives you an
extra one for free.
A baker's dozen is 13, not 12.
And that's where that came from.
It was just an opportunity toreward something where that came
(27:23):
from.
It was just an opportunity toreward something.
When I was a kid, my parentsused to take us out into the
Fraser Valley to do fresh veggieshopping at one of the farm
stands, and every time we wouldcome home my parents would take
all their veggies out of thebags and there would always be
an extra something in there thatthe owner had tossed in when my
parents hadn't noticed, as athank you.
(27:43):
So it might've been an extrathing of carrots, or it might've
been a couple of extra apples,or just something to say, hey,
thanks.
And in a way that is a discount.
You are giving them freeproduct.
You're just not calling it adiscount, but in a way it is.
So there's lots of differentways to build loyalty and this
is where discounting, if doneappropriately, can help with
(28:06):
that.
There are times where I wouldnot give a discount.
I think a lot of it depends onhow a person asks.
I think a lot of it depends onhow a person asks.
There are people who areincredibly rude about how they
ask for a cheaper price and Idon't have time for that.
(28:26):
If you are going to ask in away that devalues my work, no,
you're not.
I'm just not going to give youa discount out of ornery.
It's not going to happen.
But if somebody is very politeabout it and comes to me and
says I really love this, um, Iwould really like to purchase a
larger amount.
Is there a way that you cangive me a better price?
(28:48):
Yes, let's have a conversation.
But if it's somebody who comesup and says, um, I want to buy
this, can you give me a betterprice?
Like, and it's just one item,can you give me a better price?
Like, and it's just one item?
No, I'm not going to do it forone item.
If they offer to pay cash, Imight give them a small discount
, a 5% discount, if they paycash.
(29:09):
So all of that to say is thatdiscounting has its place.
It's not something to turn yournose up at, and it's generally
not something to get angry whenpeople ask if they can have a
discount.
As I said, depends on how theyask and what the situation is,
(29:30):
but it definitely has its placein retail, even for us as makers
and creatives.
You need to think about what iscosting you, as I said, to
bring that person into yourecosystem, and you need to think
about what is costing you, as Isaid, to bring that person into
your ecosystem.
And you need to think about,you really need to know your
pricing.
At the end of the day, it isvery hard for us to make good
(29:50):
business decisions if we do notknow the ins and outs of our
pricing.
And I can't stress this enough.
Your pricing is not just thecost of materials, it is not
just your time.
It is so much more than thosetwo things.
There is your overhead.
There is what it would cost ifyou were to hire an employee.
There's your insurance, whichis part of your overhead.
(30:13):
There's spoilage, especially ina handmade business.
How many times have you gone tolike, in my case, printing a
sheet of stickers?
I can't tell you.
How many times have you gone tolike, in my case, printing a
sheet of stickers?
I can't tell you how many timesI've printed a sheet and it's
been garbage and I've had tocheck it out.
That's spoilage.
I have to build that into mycost.
Am I priced for wholesale?
In most instances, yes, I am.
The key is your pricing.
(30:34):
You really need to know yourpricing, the ins and outs of
your pricing, and make sure thatyou're priced appropriately.
And, as I said at the beginning, most of us are not.
Most of us are priced far toolow.
This can be a really easywormhole to fall into,
particularly if you're on Etsy,where so many things are priced
for a race to the bottom, and Ithink it's really important to
(30:57):
remember that on Etsy and atsmaller craft markets and things
where you have cottagebusinesses in there, in many
instances those are people whodo this as a hobby and they are
pricing their work in order tojust make enough to cover the
cost of their materials and buymore materials because they love
what they do, whether it'scrocheting or paper making or
(31:22):
any of those things bakinggoodies to sell.
And so you have to decidewhether or not you are going to
price yourself as if this is ahobby or as if this is a
business that is going to payyour bills, and if you are
pricing it as a business that'sgoing to pay your bills, and if
you are pricing it as a businessthat's going to pay your bills,
then you should have room tooffer discounts when it is
(31:45):
appropriate.
So my general rules that I go byis I do not do anything that I
think will train my customers toexpect deals from me on a
regular basis.
I have one sale every year formy newsletter subscribers only.
It's the best deal that I offerthe entire year.
I run it usually the weekbefore Black Friday.
(32:08):
Um, I'm not running it thisyear because of the Canada Post
strike, which I'm sure for manyof you is a whole thing.
Um, not the best of timing, but, but I know that my letter
carrier for sure deserves araise, so I am with them on this
, but the timing is veryunfortunate for a lot of us
(32:30):
small business owners.
So, anyway, all that to say yes, you need to know your pricing,
you need to be able to get yourwork out there and decide when
it's appropriate.
But yeah, you don't want totrain your customers to expect a
sale from you every week.
I would rather offer one greatsale a year and then have some
(32:51):
flexibility to offer discountsor grant discounts when an
appropriate situation arises,instead of doing a sale every
three weeks or four weeks.
Yeah, so that is kind of where Istand on it and I think you
really need to, like I said,think it through when somebody
is asking you.
(33:11):
I know that for a lot of us itcan be very emotional when
somebody asks for a discount andwe feel like they're
disrespecting our work and insome cases that is true and,
like I said, in those cases it'sa flat no from me.
But in some instances it's notmeant to be disrespectful.
It's just somebody trying tomaybe be able to buy from you
(33:34):
when they otherwise might not beable to.
Or maybe, like I said, they'relooking to form a bigger
relationship where they arepurchasing regularly from you in
a larger quantity, those typesof things.
So think it through, know yourpricing and decide what your
rules will be.
Will you offer a friends andfamily discount?
(33:56):
I know a lot of people who dothis.
If you're a friend or a familymember, you ought to get an
automatic discount when youpurchase.
It's kind of cool that we runour own businesses and we get to
make these decisions.
What I will caution against isif somebody asks for a discount
and you are not willing to giveone, think about that person.
(34:19):
They are still a potentialpotential customer.
Unless they're a real jerk,then do you want them as a
customer?
Probably not, but in manyinstances they are still a
potential customer.
So respond to them in a waythat shows that you value them
as a potential customer, butthat you are not in a position
(34:39):
at this time to offer them whatthey're asking for.
And there's so many differentways you can respond to this.
It could be something as simpleas I'm really sorry, but at
this time of year, that is thebest price that we can do.
Or you can say something likeno, but if you would like to
join my email list, I would behappy to give you a 10% discount
, but otherwise I'm not able to.
(35:01):
Or you could say something likeno, but we are going to be
having a Black Friday sale onthis day on our website.
You are welcome to shop then.
We're going to be having somegreat deals on the site then and
just redirect.
Another thing that that last onethere just made me think of is
(35:24):
when you know you're going to beholding a sale in a few days
and somebody asked for adiscount on that item earlier.
Do you really want to say noand turn them away and then have
them come along a few dayslater and see that the item is
on sale?
Like you know, sometimes youhave to think about whether it's
(35:44):
worth it, like would it just beworth it to just give them the
discount now and let them knowthat that's the reason why and
say you could say something likeyou know what, this is going to
be on sale for 30% off forBlack Friday in two days, but I
know we're here in person atthis market so, if you would
like, I can offer you 15% off or30% off, or you can wait to
(36:06):
shop the Black Friday sale.
You know there's different waysyou can handle it and I think
that's kind of the key here isyou want to make the person feel
valued but still stand yourground, and there's ways that
you can do that that are politeand respectful of their
situation and still keep them assomebody who may potentially
(36:28):
buy from you.
They may even come back at theend of the show or wherever it
is that you're talking to themand purchase.
Maybe they need to think aboutit a little bit.
Yeah, so, anyway, all that tosay, with Black Friday coming up
, you don't need to participateif you don't want to.
Um, if you do want to go for it, there are other ways you can
(36:52):
offer discounts.
There are other ways you cangive people a deal.
There are other ways that youcan reward loyalty.
And again, it's all up to you.
You're the business owner, youget to make the decisions, and
that's all I have to say thisweek.
So that's it for this week.
I hope those of you who aredoing anything for Black Friday,
cyber Monday or Boxing Day Ihope that you have a successful
(37:14):
sale.
I know it is really rough outthere this year.
I've heard so many stories frompeople who are really
struggling and who are just notgetting the sales this year that
they need.
So I hope that maybe a smalldiscount would help you get over
that rough hump.
Maybe doing a Black Friday salewill help you get there.
(37:34):
That's what Black Friday wasall about originally.
It was called Black Fridaybecause it was the Friday of the
year, or it was the day of theyear where businesses went from
running in the red to running inthe black for the year, and
that's often how long it wouldtake some businesses to get out
of the red.
It would take them until theend of November.
So if you look at it that way,then maybe the Black Friday is
(37:58):
what you need what you need thisyear, I don't know.
Anyway, it is rough out there.
I hope it.
Um, I hope you're all having agood, successful holiday season,
and that's it for this week.
I'll be back in another twoweeks with another brand new
episode and we'll talk to youall then.
Thank you so much for joining usfor the Anchi Looked Up
(38:19):
Creative Hour.
If you're looking for links orresources mentioned in this
episode, you can find detailedshow notes on our website at
andshelookedupcom.
While you're there, be sure tosign up for our newsletter for
more business tips, profiles ofinspiring Canadian creative
women and so much more.
If you enjoyed this episode,please be sure to subscribe to
(38:39):
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episode.
We always love to hear from you, so we'd love it if you'd leave
us a review through iTunes orApple Podcasts.
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Thanks for listening and we'llsee you next week.
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