Watching costs improves your bottom line

I love quilting and often create things for the sheer joy of it.  Lots of time, love and extra special fabrics go into quilts for loved ones without considering the cost. Moving from hobby to business quilter required a change in mindset.

My goal is to provide a quality service for my customers at fair price for both of us.  So far, so good, but materials costs are rising and I am afraid I’ll lose some of my customer base if I raise my prices too much.

Basically, I have two ways to improve my profitability – cut costs or increase prices. (Remember, the purpose of being in business is to make a profit?) Cost cutting can include buying supplies at cheaper prices or investing in equipment that will save production time without sacrificing quality.  I do have some wholesale suppliers, but the fabric wholesalers currently have minimums that are out of my reach.

What’s a micro business owner to do?  
(1) Limit customer options.
(2) Shop retail on sale and stock up.
(3) Some combination of 1 & 2 with upcharges for certain things clearly spelled out.

I choose option #3.

I limit customer options with regard to:
(a) overall design (grid, wonky or mosaic)
(b) machine quilting (straight line at 1″ intervals, simple meander or loopy meander)
(c) thread color

(a) Fabric above a certain price point. This allows the customer to use any fabric they want, but means I don’t have to absorb the cost of the fabric they must have and can only be found at the LQS for $13.75/yard.
(b) Fancy machine quilting or anything over a twin size. Most of my orders are for lap size quilts (roughly 50″x66″), so anything over a twin automatically goes to the local longarm quilter. Customers are told this when they first inquire about my services. (Note: I now have a mid-arm machine and am practicing my quilting designs).

My interfacing and batting come from the big box craft stores when they are on sale and there’s either an additional 20% off the purchase or I use my 15% teacher discount.  If I find a backing fabric that I really like at a quilt shop or the big box craft store, I may buy the entire bolt if it’s at a really good price.

Cost comparison for a 3 x 4 grid t-shirt quilt (50″ x 66″)

6 yards of interfacing, 6-1/4 yards of fabric and a twin package of batting from Joann:
Full retail:  $130.00  Carefully shopped: $86.00

THIS MEANS $44.00 more in your pocket by watching how/where you shop.

You might even save a few more dollars if you hit things on sale at the right time. 

In my area, the going rates for a 12 t-shirt grid style quilt with sashing and a border range from $195.00 to $380.00.  That’s a pretty wide range of prices. The person at the high end is rumored to have to turn away business. I’m somewhere in the middle. I’d really like to see how the company that charges $195.00 makes any money. Are they able to save on supplies, have super speedy construction methods or are they paying themselves $3.00 an hour at the end of the day?  Yes, there are times when I’ve probably averaged $3.00 per hour on some projects in the beginning stages, but thankfully, not anymore. 🙂