Blade pricing is something that gets discussed in knife making communities from time to time. Sometimes people just look at the price and say ‘wow, X Dollars is too much’. And indeed, some prices are high. My own work is not cheap by any stretch of the word.
My business is not just me taking some under the table cash. I am an actual registered business. The reason is simple. If you regularly, receive money for things you sell, you are legally required to make that part of your tax filings. Not doing so is not smart and may turn out an expensive mistake. So the money is not my profit. It’s ‘income’. And that goes to pay for costs, including but not limited to:
- Grinding belts
- Shop electricity
- Various types of steel
- Internet domains, software licenses.
- A licensed accountant (seriously, NOT cheap and worth every penny)
- Social security
- Miscellaneous consumables such as sandpaper, glue, tape, bolts, pins, washers, ….
We’re not there yet of course. Because any big shop has big tools and big tools are expensive tools. Off the top of my head, that list includes.
- Hydraulic forging press
- belt grinders
- band saw
- drill press
- angle grinders
- welding station and helmet
All those things need to be paid for. The total cost runs into > 10000 Euro easily. And the expensive ones need to be written off over multiple years. New equipment needs to be added, and broken things replaced. And of course, we’re still not there yet.
Being in this business at the high end means that I use expensive and unique materials. These materials can often be bought only at irregular basis. Especially fossil materials. I want specific colors, materials, or specific sizes. So I need to buy them when I can, because when I need them, I will probably not find them at short notice. This also means that my stock is always bigger than what I actually use. Most of the materials will eventually get used, but even so, I have many thousands tied up into fossil materials, a nickel Iron meteorite, wootz from Alfred Pendray, …. that all needs paying for as well.
So that’s the biggest part of the costs looked at. By now, that 700 we started with is much less. That leaves the remainder to be divided over the number of hours that went into it. And some of these are hidden time sinks.
- Making the blade. This amount of time is obvious and can be measured easily.
- Making the steel. When I do damascus projects, the complex ones take many hours just to make enough damascus for 1 or 2 blades.
- Keeping the shop up and running. Fixing broken things, making ‘temporary’ tools for a specific purpose, cleaning the place, …
- Doing my paperwork. Running a business requires a lot of paperwork, as well as making invoices, maintaining my inventory lists, doing bookkeeping, …
- Drawing up designs, experimenting with materials and constructions in order to achieve a certain design.
- Emailing is a biggie. Things that are for sale on my page are easy. But most of my work is custom. Every email takes time. Custom work requiring 30 emails or more is not an exception. I’ve had 1 particular project where the email chain was 100 messages. All that time needs to be counted.
- Making high quality pictures in a lightbox, cropping them, making certificates, …
- Maintaining visible profiles on Facebook, Instagram, this website, the internet community forums that I am a member of, …
There is a lot going on that drastically increases the total amount of time going into a blade. But we’re not there just yet. After all, this is an official registered business, so before the money pays for my hours, the taxman wants their pound of flesh:
- Social security
- Income tax
- Province tax
- County tax
For me, this is only a part time business. This means I do not have the benefit of scale to turn those fixed costs into the margin. And I only have so much time to make blades. But that doesn’t really matter because I do this as a hobby. Even so, everything needs to be paid for because otherwise it would implode financially.
If you need to hire a master electrician for 2 days of work, it’s going to be expensive. If you need someone to rebuild your car engine, it’s going to be expensive. If you need to hire a lawyer or an accountant, it’s going to be very expensive per hour. And if you hire someone to paint a portrait, sculpt a statue, or do something else of that nature, you would expect to pay a lot if the artist is any good.
When you buy a blade from me, you don’t just buy ‘that blade’. You buy that blade and everything that went into making it possible for me to make that blade.