Help me value my work appropriately?
May 4, 2020 2:13 PM Subscribe
I'm an employee at an acquaintance's shop, and I've discovered that there's creative labor that I can do for the business that seems to be popular among patrons. How do I make this work for me?
I'm doing a little creative side hustle for a business. I am an employee of the business and would describe my relationship with the owner as friendly.
The setup is it for right now she is providing the materials, and I am the creative labor. We had agreed at first to split proceeds after material costs, but the estimated that material costs were 50%, which seems excessive. She also does not have any unit costing done, so it's an arbitrary number. I was taken aback by this, but I'm also new at the thing I'm doing and I also don't think we weren't pricing the product appropriately at first, so her estimates may have been right. I believe that she wants to be as equitable as possible and is open to having ongoing conversations about a compensation model that works, and has thrown out ideas of an hourly model with tracking, an hourly model with creation as side work (which I am decidedly not into), continuing to split revenue, or perhaps piecemeal costing.
I understand that by providing the materials she is also taking on a cost/risk and I want to be respectful of that. She has access to invoices/unit costing, and I have asked for that information so I can make a spreadsheet to determine her costs going forward and help her to charge appropriately for her goods and my work. She seems into this idea. I'm also not beyond opposed to buy my own materials at some point.
I would like to be compensated and recognized fairly. I'm going to set up a social media/portfolio of my work so I can gather followers, but I'm having trouble putting my finger on what my actual creative work is worth. I enjoy the work and it's a nice creative outlet I can currently do at home. I am a graduate student and don't necessarily see myself starting a comprehensive side hustle right now, but I could also see this growing when things return to normal.
Please tell me where my expectations, assumptions, etc, are out of line with reality and what sort of arrangement is most suitable? Thank you.
I'm doing a little creative side hustle for a business. I am an employee of the business and would describe my relationship with the owner as friendly.
The setup is it for right now she is providing the materials, and I am the creative labor. We had agreed at first to split proceeds after material costs, but the estimated that material costs were 50%, which seems excessive. She also does not have any unit costing done, so it's an arbitrary number. I was taken aback by this, but I'm also new at the thing I'm doing and I also don't think we weren't pricing the product appropriately at first, so her estimates may have been right. I believe that she wants to be as equitable as possible and is open to having ongoing conversations about a compensation model that works, and has thrown out ideas of an hourly model with tracking, an hourly model with creation as side work (which I am decidedly not into), continuing to split revenue, or perhaps piecemeal costing.
I understand that by providing the materials she is also taking on a cost/risk and I want to be respectful of that. She has access to invoices/unit costing, and I have asked for that information so I can make a spreadsheet to determine her costs going forward and help her to charge appropriately for her goods and my work. She seems into this idea. I'm also not beyond opposed to buy my own materials at some point.
I would like to be compensated and recognized fairly. I'm going to set up a social media/portfolio of my work so I can gather followers, but I'm having trouble putting my finger on what my actual creative work is worth. I enjoy the work and it's a nice creative outlet I can currently do at home. I am a graduate student and don't necessarily see myself starting a comprehensive side hustle right now, but I could also see this growing when things return to normal.
Please tell me where my expectations, assumptions, etc, are out of line with reality and what sort of arrangement is most suitable? Thank you.
Response by poster: Sorry. I didn't think the price was appropriate at first and I think it's approaching appropriate.
Currently the things are separate, and it could be modeled as you say -- it's a plant shop and they sell dried flowers as a sort of build-your-own thing, I make and sell premade arrangements. I would prefer to do this completely on the side, as in I don't think it's ideal to be making them on my downtime for my hourly wage though I think the owner would like and benefit from this.
posted by sibboleth at 2:42 PM on May 4, 2020
Currently the things are separate, and it could be modeled as you say -- it's a plant shop and they sell dried flowers as a sort of build-your-own thing, I make and sell premade arrangements. I would prefer to do this completely on the side, as in I don't think it's ideal to be making them on my downtime for my hourly wage though I think the owner would like and benefit from this.
posted by sibboleth at 2:42 PM on May 4, 2020
I'm thinking of all the factors I'd put into this calculation, but the truth is, I'd want to do the real math on the materials and figure out how much the gross margin is on each object. It's entirely possible that the materials do cost 50% in an area like flower arranging, but I think that if your hourly rate for this work (when you factor in all your time) ends up being less than 2x your hourly rate in the shop, you should look at a different percent split.
The main question is whether she could easily find someone else to provide the same type of product you do *of a comparable quality.* If your arrangements are selling better than others, or you've developed a product that works particularly well for her clientele, or you've gotten very efficient, then it makes sense to charge more. But even if this is something she could get someone else to do, 1.5 to 2 times your hourly rate in the shop would be the lowest I would go.
I hope this helps!
posted by gideonfrog at 2:54 PM on May 4, 2020 [2 favorites]
The main question is whether she could easily find someone else to provide the same type of product you do *of a comparable quality.* If your arrangements are selling better than others, or you've developed a product that works particularly well for her clientele, or you've gotten very efficient, then it makes sense to charge more. But even if this is something she could get someone else to do, 1.5 to 2 times your hourly rate in the shop would be the lowest I would go.
I hope this helps!
posted by gideonfrog at 2:54 PM on May 4, 2020 [2 favorites]
Best answer: I didn't think the price was appropriate at first and I think it's approaching appropriate.
Who is setting the price?
it's a plant shop and they sell dried flowers as a sort of build-your-own thing, I make and sell premade arrangements.
Where and how are these arrangements you make being sold?
I would prefer to do this completely on the side, as in I don't think it's ideal to be making them on my downtime for my hourly wage though I think the owner would like and benefit from this.
Yes, the owner would like this, because it is - to some extent - expanding your job duties & her profit without necessarily paying you appropriately for the work you're doing.
I get that the business aspect of creative-y stuff can be a little muddled, especially if it overlaps with your "regular" job, but right now this seems really vague. I think you (& the owner) should approach this in one of three ways:
1) The arranging is a completely separate business where you happen to get your raw materials from a place where you hold an entirely different job. She sells you the dried flowers at like her wholesale cost plus 10 or 20 percent. You make the dried flower arrangements on your own time in your own space and sell them on your own (on Etsy? ebay? Facebook? Just to folks that you happen to know? Local arts & crafts fairs when they return?). You have to figure out what the market will bear for these, you set the prices (and you may have to declare income & pay taxes). This means you get to determine what a "fair" price will be. Once you've paid the owner for the dried flowers her involvement is done - but this does probably mean that it would be best for you not to promote your arranging business in the store.
2) Making the arrangements (so the store can sell them) is now a new element of your job that you require a higher hourly wage for. This could get complicated in keeping track of which hours you are working on arrangements and which you are doing regular duties, but it's hardly impossible. (I think this is the "hourly model with tracking" the owner is talking about, kind of, but in this situation you wouldn't worry about any "pay for raw materials" or "side hustle" complications, you would just get paid more per hour on the hours when you're working on arrangements. I tend to agree with gideonfrog that 1.5 or 2x your normal hourly wouldn't be out of line to ask for.)
3) (Which it seems you are kind of half-assedly doing now, albeit in a fairly complicated way) - The store sets the prices and sells the arrangements, making arrangements is now part of your normal job duties, you make the arrangements during your normal work hours at your normal hourly rate but you also get a commission, a percentage of the sale price of each arrangement sold. In commission terms 50% is pretty darn good, very generally speaking.
IOW, the problem right now as I see it is that you are not really working a side hustle but are also not really doing this thing as an employee - understandable, as you guys seem to have sort of vaguely wandered into this idea of making and selling arrangements and not really discussed details, but I think you need to pick one or the other and figure out fair compensation from there.
I'm having trouble putting my finger on what my actual creative work is worth.
Probably worth doing some research into other sellers of dried flower arrangements (locally? on Etsy?), seeing what they charge, figure out how long it takes you to make one (on average), subtract materials cost, then see if what's left over is actually worth your time. Which could affect what the best approach for you would be; if arrangements sell for $20, it takes you two hours to make one and $10 in materials, that winds up being $5/hour - not so great. But if you make $10 as a 50% commission on top of your regular hourly wage, that seems better.
Also are there other shop workers or local folks who do some arranging for/with the store? You could ask them what kind of agreement they have.
(I have typed "arrangements" about 50 times during this answer and not gotten it right the first time once.)
posted by soundguy99 at 4:09 PM on May 4, 2020
Who is setting the price?
it's a plant shop and they sell dried flowers as a sort of build-your-own thing, I make and sell premade arrangements.
Where and how are these arrangements you make being sold?
I would prefer to do this completely on the side, as in I don't think it's ideal to be making them on my downtime for my hourly wage though I think the owner would like and benefit from this.
Yes, the owner would like this, because it is - to some extent - expanding your job duties & her profit without necessarily paying you appropriately for the work you're doing.
I get that the business aspect of creative-y stuff can be a little muddled, especially if it overlaps with your "regular" job, but right now this seems really vague. I think you (& the owner) should approach this in one of three ways:
1) The arranging is a completely separate business where you happen to get your raw materials from a place where you hold an entirely different job. She sells you the dried flowers at like her wholesale cost plus 10 or 20 percent. You make the dried flower arrangements on your own time in your own space and sell them on your own (on Etsy? ebay? Facebook? Just to folks that you happen to know? Local arts & crafts fairs when they return?). You have to figure out what the market will bear for these, you set the prices (and you may have to declare income & pay taxes). This means you get to determine what a "fair" price will be. Once you've paid the owner for the dried flowers her involvement is done - but this does probably mean that it would be best for you not to promote your arranging business in the store.
2) Making the arrangements (so the store can sell them) is now a new element of your job that you require a higher hourly wage for. This could get complicated in keeping track of which hours you are working on arrangements and which you are doing regular duties, but it's hardly impossible. (I think this is the "hourly model with tracking" the owner is talking about, kind of, but in this situation you wouldn't worry about any "pay for raw materials" or "side hustle" complications, you would just get paid more per hour on the hours when you're working on arrangements. I tend to agree with gideonfrog that 1.5 or 2x your normal hourly wouldn't be out of line to ask for.)
3) (Which it seems you are kind of half-assedly doing now, albeit in a fairly complicated way) - The store sets the prices and sells the arrangements, making arrangements is now part of your normal job duties, you make the arrangements during your normal work hours at your normal hourly rate but you also get a commission, a percentage of the sale price of each arrangement sold. In commission terms 50% is pretty darn good, very generally speaking.
IOW, the problem right now as I see it is that you are not really working a side hustle but are also not really doing this thing as an employee - understandable, as you guys seem to have sort of vaguely wandered into this idea of making and selling arrangements and not really discussed details, but I think you need to pick one or the other and figure out fair compensation from there.
I'm having trouble putting my finger on what my actual creative work is worth.
Probably worth doing some research into other sellers of dried flower arrangements (locally? on Etsy?), seeing what they charge, figure out how long it takes you to make one (on average), subtract materials cost, then see if what's left over is actually worth your time. Which could affect what the best approach for you would be; if arrangements sell for $20, it takes you two hours to make one and $10 in materials, that winds up being $5/hour - not so great. But if you make $10 as a 50% commission on top of your regular hourly wage, that seems better.
Also are there other shop workers or local folks who do some arranging for/with the store? You could ask them what kind of agreement they have.
(I have typed "arrangements" about 50 times during this answer and not gotten it right the first time once.)
posted by soundguy99 at 4:09 PM on May 4, 2020
Are you taking any risk? What if an arrangement does not sell or what happens if the store buys too many of an item that would go in an arrangement? If you are an employee that is one thing. If you are an entrepreneur that is another.
If the owner is buying the materials and you are doing the arranging on your own time, I would say a sliding scale percentage after actual cost makes sense. You could actually account for this as a separate business within her business. In my business, the money person and the risk taker get 50 % and the worker gets 50%. You could split 50 50 on the first $X of profits and then you would get more percentage the more you make.
Or, just raise your hourly wage and do it at the store and let the owners take risk.
posted by AugustWest at 4:55 PM on May 4, 2020 [1 favorite]
If the owner is buying the materials and you are doing the arranging on your own time, I would say a sliding scale percentage after actual cost makes sense. You could actually account for this as a separate business within her business. In my business, the money person and the risk taker get 50 % and the worker gets 50%. You could split 50 50 on the first $X of profits and then you would get more percentage the more you make.
Or, just raise your hourly wage and do it at the store and let the owners take risk.
posted by AugustWest at 4:55 PM on May 4, 2020 [1 favorite]
Besides providing you with the materials to make the arrangements, the owner probably pays rent, utilities, supplies such as bags, light bulbs, pencils and pens, all the little things one needs to run a business.
They need to factor that cost into the price they are quoting you for supplies.
I may be a little off base here, but I worked at a bead shop for years and made jewelry from the beads for the shop to sell and it was just considered by both myself and the owner as part of my job. I also had my own jewelry business on the side where I bought all the supplies and materials and took all the financial responsibility of running my own business, some supplies at a discount from my boss but others on my dime.
posted by starfish at 5:42 AM on May 5, 2020 [2 favorites]
They need to factor that cost into the price they are quoting you for supplies.
I may be a little off base here, but I worked at a bead shop for years and made jewelry from the beads for the shop to sell and it was just considered by both myself and the owner as part of my job. I also had my own jewelry business on the side where I bought all the supplies and materials and took all the financial responsibility of running my own business, some supplies at a discount from my boss but others on my dime.
posted by starfish at 5:42 AM on May 5, 2020 [2 favorites]
@soundguy99, in your example, $10 in materials and $20 price leaves $10 profit, of which sibboleth gets $5 for two hours work, so $2.50 per hour. No?
To the OP's question: get the unit costing close to correct first, so you can be confident the split is equitable. Then figure out if the price is right, the materials can be sourced for less, and only then whether it's worth your time.
posted by at at 6:54 AM on May 5, 2020
To the OP's question: get the unit costing close to correct first, so you can be confident the split is equitable. Then figure out if the price is right, the materials can be sourced for less, and only then whether it's worth your time.
posted by at at 6:54 AM on May 5, 2020
@soundguy99, in your example, $10 in materials and $20 price leaves $10 profit, of which sibboleth gets $5 for two hours work, so $2.50 per hour. No?
Sorry, I was a bit unclear on that - that scenario was under the "sibboleth is a totally independent business" idea: they pay $10 to owner for materials (which is the only money the owner gets), sibboleth sells the arrangments independently for $20, leaving $10 entirely for sibboleth. Takes two hours to make flower arrangements, so they're earning $5/hr.
You are right, though - if sibboleth & the owner continue under some kind of "split profit" idea, sibboleth could make even less . . .
posted by soundguy99 at 7:14 AM on May 5, 2020
Sorry, I was a bit unclear on that - that scenario was under the "sibboleth is a totally independent business" idea: they pay $10 to owner for materials (which is the only money the owner gets), sibboleth sells the arrangments independently for $20, leaving $10 entirely for sibboleth. Takes two hours to make flower arrangements, so they're earning $5/hr.
You are right, though - if sibboleth & the owner continue under some kind of "split profit" idea, sibboleth could make even less . . .
posted by soundguy99 at 7:14 AM on May 5, 2020
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Sorry, this part is unclear - you did think the price was appropriate, or you didn't think the price was appropriate?
Also, has the price changed since then? Has the price gone up or down?
I'm doing a little creative side hustle for a business. I am an employee of the business
This is also unclear - are the creative things you are doing completely separate from your regular job at the business? Is the creative work/product a "side hustle" for the company itself (like, you work at a store that sells fabric and the owner has decided to temporarily expand into sewing COVID-19 masks)?
I feel like the answer could depend quite a bit on how this creative side hustle compares or intersects or overlaps with your "normal" job duties and the "normal" focus of the business.
posted by soundguy99 at 2:31 PM on May 4, 2020