I've been meaning to write a blog post about what actually goes into designing a pattern, and given the current discussions and my own recent posts, now seems as good a time as any. There is no set formula for calculating costs, and every designer's experience will be different - this is a creative game after all, and we're all individuals with different strengths and different approaches.
The production costs - actual expenses
This is the easiest thing to quantify. Each of my patterns goes through test knitting AND tech editing, and all of these people are compensated for their time. Each pattern generally gets seen by two tech editors, and the tech editing time for each is normally around an hour (simpler patterns less; more complex patterns more). Tech editing costs per pattern are roughly £30. Books and their patterns go through 3 levels of tech editing with both editors and a typical tech editing bill for a 10 pattern book comes to around £800 - £900, bringing the average cost of tech editing per pattern closer to £50.
Each pattern is also test knitted, and generally by two test knitters, who each knit a different size to ensure that that it all works out correctly. Many designers use editors OR testers but I use both. Not only does it reduce the chances of errors to virtually zero, and ensure that my editors get a very clean pattern (patterns are test first, then edited) but it also helps me understand how the pattern will behave when other yarns are used, and get feedback on the knitting experience.
Testers are paid a compensation that is based on yardage used, in addition to a flat fee to cover yarn costs, admin time etc. Obviously that means that costs can vary from pattern to pattern, but the average test knitting cost is £35.
Then there is the photography. I take all of my own photos, which helps keep the cost down considerably. I also pay my models, because it's their time I'm taking and they also need to earn. I do try and photograph as many Hats as possible in one shoot, and the shoots are only a couple of hours each. Yet I will photograph each Hat more than once, which adds another level to the costs, but on average that's another £20 added to the production costs (if I paid a photographer it would be considerably more!)
Next we have yarn costs. I do get sponsorship from yarn companies (i.e. free yarn for specific patterns) but quite often I will also buy the yarn I think will work best for the pattern; I'm happy to do this for a few reasons and don't expect my yarn to always be free. I buy roughly 60% of the yarn I use; sometimes I'll need more than the 100g (swatching, 2nd sample etc) and based on that the yarn cost per pattern works out to roughly £10
And then there's advertising. This covers things like Ravelry ads or the cost of sending out a newsletter to promote the pattern. This averages out to about £15. I'm really frugal on this front - many designers will spend considerably more! That said, there are other advertising costs which are indirect and don't fit into this first budget.
So... initial direct production costs come to £130. That's how much I lay out directly for each pattern.
At full price of £3, and taking into account PayPal fees, I'd have to sell 49 copies to cover that. At a discounted price (i.e. coupon through the newsletter or wholesale rate) I'd have to sell 87 copies to cover these costs.
The other production costs
One of the hardest things for any designer to put a figure on is how much time is spent on producing the pattern. There's the knitting time and the re-knitting time and the pattern writing time and layout time and photography time (because yes, I do all of it) And there's also the thinking time and emailing time (discussions back and forth with testers and editors etc) and to be quite honest, if I sat and counted all of the hours spent it would work out to a thoroughly depressing hourly rate, so I refuse to do it for each pattern.
For the sake of finding some figures, I've looked at a quick pattern (chunky yarn, straightforward design) and a so very not quick pattern (fine yarn; frogged countless times) to calculate some sort of average. The numbers below are based on this average. And I've worked backwards, as it made things easier to work out!
- Uploading & managing POS - 2 hours
- Layout time - 2 hours
- Photo editing - 1.5 hours
- Photography - 1 hour
- Editing time - 1.5 hours
- Pattern writing and charting - 2.5 hours
- Knitting time - 24 hours
That amounts to an average of 34.5 hours of my time spent on each pattern in the production stage. These figures will vary wildly for each designer, and they would change constantly too, as experience is gained and new avenues are explored. As I say it is the hardest thing to quantify and I've more than likely under estimated rather than over. Thinking time in particular is impossible to guesstimate.
So, based on an average of 34.5 hours per pattern, and if we look at minimum wage as a base point, each pattern would have to pay me £224.25. In terms of sales, and remembering that PayPal take their cut, I would have to sell 84 patterns at full price, or 150 at a discounted price.
That brings the number of copies that needs to be sold to 133 at full price, or 237 at a discounted price.
The non-production costs
This is the part that frequently gets over looked. And it's probably one of the most expensive areas.
Let's think about the photography for a moment... I keep production expenses down by doing the photography myself. Yet it's taken years of practice to get my photos up to a half decent standard. And each time I get the camera out to practice, I've paid my models. And the camera itself has a cost too - the different lenses, the filters, and even odd bits like the camera bag and cables. I use open source software for just about everything so my software costs are low too (i.e. practiaclly zero) but a designer who edits their own shots and doesn't use open source still has to buy the software to be able to do that.
We're looking at thousands on this front. The camera alone has cost over £1,500 without adding in any contact hours. And you don't just buy once and use forever; tech breaks. It needs repair or replacement. Tech gets out-dated. It's a never ending cost.
Then there's the computer. My laptop is now 3 years old, and it cost a small fortune at the time to buy (thankfully it was on sale, else it would have left an even bigger dent) but I got what I paid for, and have a powerful and reliable machine. I keep a laptop as my main computer because I travel so much - a desktop would be totally impractical!
Adding to the laptop is the cost of back up hard-drives, thumb drives, cables, the printer and a whole bunch of other tech. Tech is expensive, if you want to buy good stuff that lasts. I buy most things on sale or secondhand, yet I've still spent thousands and thousands.
Then there's my knitting skill. I've been knitting since I was 3 - how far can you reasonably claim for hours spent developing skills? Training courses are an obvious and quantifiable cost, but practice and thinking time isn't. Where do you draw the line?
Other costs are easier to see, the non-production expenses. Such as building a website and paying the monthly host fees (£15 per month) and annual domain renewals and email renewals etc (£60 per year). There are Ravelry fees for selling patterns, which are based on volume. There's the cost of the internet and phone line (roughly £30 per month).
Whilst I do a lot of the production myself, I do outsource some of it. Such as the illustrations - my illustrator is great and charges a very reasonable rate per illustration, and the resulting tutorials add a lot of value to the books and patterns - they make the project easier for you, the knitter.
You have the cost of marketing and promotion - exhibiting and travel. Paying someone to write the copy (I'm useless at that!) or to copy edit your work. There's the cost of business cards and postcards and the display items and head stands. There's the cost of hiring a stand (a small fortune at a trade show) and all the time planning and developing the display.
You could argue that these aren't pattern costs, and I get that. But when pattern sales make up 98.5% of your turnover (and income)(including books) then yes, they are pattern costs, as the patterns have to pay for them. Business speak says that these costs are "indirect costs", and they're still costs all the same. And how would you calculate how many patterns have to be sold to cover all of this?
The post production costs
Once a pattern goes out there, once it's published and in the hands of the knitter, it's costs don't stop. If an error is found, I have to spend timing working it out and sending it back to the tech editor for review, which can often take more time than the initial production (getting back into a pattern that you haven't looked at for 5 years isn't all that easy). There's time involved in uploading the revised file to the various sources, and that all uses bandwidth (my internet is mostly a PAYG modem, so bandwidth is a tangible cost).
Then there's pattern support. I'm very fortunate in that I receive very few emails from knitters needing help with my patterns, but nonetheless, I still get them, and they still take time. I spend a huge mount of time writing to companies who sell my patterns, keeping services up to date, and generally emailing about other work related things that aren't pattern support. These are all mostly good things, and essential things, but time it still is.
What about social networking? Time spent keeping up with knitters and Hat lovers? Posting photos and sharing tips? If I was a proper business sort I'd be counting those hours, but I'm not, and I don't. But it's still my time. These are post production costs too, as they are usually pattern specific.
Having read all of this, you might be thinking, well that's easy, you must sell thousands of each pattern!
I don't have any patterns that haven't covered the expenses I've laid out in the first section. But there are patterns that haven't covered the time I've spent on them. And few patterns can reach as far as helping to cover the non-production costs. Very few designers have pattern sales in the thousands on a regular basis. You'd consider yourself lucky if pattern sales reach the hundreds!
Would it put it into perspective if I told you that we as a family live below the poverty line? I don't make minimum wage. We are able to live and keep fed because I'm frugal and our lifestyle is a cheap one. I don't have a mortgage to pay; no-one would ever give me one on my income. I'm OK with that because I'd rather we live as we do and I don't want to turn this into an emotional post, but sometimes a little context helps. We don't charge what we do for our patterns because we're trying to rip knitters off; we charge what we do because that's what it costs. We're not getting rich! And our time is no more or less valuable than anyone elses.
What you get when you buy a £3 pattern is an awful lot of time and energy and skill and expertise and creativity, all rolled into one. If you can't afford to pay that, I totally understand, because I couldn't either. But please don't expect our patterns to be free; please respect our right to charge for our work and our time. Yarn companies can afford to give patterns away for free because they're loss-leaders to them; they're trying to sell you the yarn and the pattern costs are hidden. That's not the case for us. When you buy a pattern from an independent designer, you are directly supporting a small business, an individual's creativity and maybe even helping a young family like ours.