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How much more?

Posted by Dave Bull at 2:35 AM, July 27, 2011 [Permalink]

Mystique print #15 is still at the test printing stage; and has been 'stalled' there for a few days now. Part of the delay has been that this one is not trivial in any way - it's far and away the most difficult print in this series (and will look it, too!) The boxwood block allowed a very fine level of detail to be carved, but such hard blocks are extremely difficult to print, as they don't 'drink' the moisture well. I'll have a little bit of a surprise to offer about that, once I've got it up and running ...

Another reason for the delay has been an interruption for work on the summer series of Senshafuda prints. This set is turning out to need a lot more work at the 'editing' stage than the initial group I published a few months back, and I've spent more time in Photoshop than I care to think about! But I worked out the final colour separations last night, passed them over to carver Sato-san this morning, and he is working full steam ahead.

And of course, a few mornings each week - time that should normally be my own prime working hours - have been spent coaching Tsushima-san the printer, who is coming along very well.

But it's not just print production issues that have been on the table this week. Me and my 'buddies' - the people who run such places as Toyota and Sony - have been watching the financial pages with a growing sense of impending doom.

It's the yen/dollar rate of course. Those of us who make a living exporting our products from Japan (more than 70% of my prints are going overseas these days) can do no more than sit and watch as the exchange rate moves into territory that would have seemed inconceivable just a few years ago.

Here's a chart of the change in the rate in the past year (since just after the beginning of the Mystique series) [clickable]:

The number in the lower right corner says it all - down more than 17% over that time. That, of course, is coming directly off my income. And there is no corresponding gain for me on the import side - I import nothing!

And when we look at the longer term, it's even worse. Here's the same chart extended back further in time, to a point nearly ten years ago, when I was making the Surimono Albums. The red box here is the same area as the first chart ...

More than 40%! (And remember, a 40% change in the exchange rate doesn't mean that my prints are 40% more expensive, it means that they would have to be priced 66% higher to bring me the same amount!)

Now Toyota has a sort of 'solution' for this - open factories in the US, and build the product right there in the market where it will be sold. Hah! Do you think I should put a 'Help Wanted' sign up ... in North Carolina or someplace like that?

Anyway, the point of the story ... I sure hope my US friends get their budget thing together, because if the US dollar really does go off a cliff, we're all going to be in very deep water, I think!


Following comment posted by: Dave on July 27, 2011 9:13 PM

Having posted that ... 'shooting' at the US and kind of blaming them for the monetary problems, it's only fair to post a link to this, which shows all too clearly that we have plenty of similar budget/deficit/taxation problems on this side of the Pacific too!

Following comment posted by: AEleen Frisch on July 27, 2011 11:40 PM

Your friends in the US have no control over what happens with the budget. Your, and our, enemies, on the other hand, ...

Following comment posted by: James on July 28, 2011 12:06 AM

But isn't this the first series for which you've allowed payment in dollars? I remember paying for previous subscriptions in yen and seeing the cost rise each month. Perhaps you should begin having subscribers prepay for an entire series, although I have no doubt that would be harmful to your subscription numbers.

Following comment posted by: Dave on July 28, 2011 12:32 AM

seeing the cost rise each month

That's of course why I began to offer the prints in dollars - to move the burden of price rises to my side rather than leave it as a responsibility of the collectors. Over the course of the year I've certainly taken a hit on the amount that I receive each month, but - perhaps because of the new policy? - subscription numbers are well up over previous years.

So for my subscription print series - where all the labour is my own - this is something I will just have to live with. I end up working longer for a smaller amount, but no problem. Hey, I'm a woodblock printmaker!

Where it is going to kill me though, is in the stuff that I have begun to commission from other craftsmen (the new Senshafuda series, etc.) Because my costs are substantial, I have much less flexibility on the pricing. I wanted to keep the price of all the prints in that series at a constant level, but the drop in the dollar over just the past few weeks has pretty much wiped out whatever small margins were there to begin with. But putting up the price is going to result in fewer orders ...

Following comment posted by: Marc Kahn on July 28, 2011 1:48 AM

Maybe it's time for you to move back to North America? Just saying... ʠʭ-)

Following comment posted by: Barbara Mason on July 28, 2011 2:56 AM

You might be surprised... raising the price gradually will probably not make any difference to most people.. just a few. I think your work is priced way too cheap in comparison to other artwork and the quality is unsurpassed.

Following comment posted by: Michael Kohne on July 28, 2011 4:24 AM

On the subject of pricing in US dollars: I actually think pricing in US dollars is mostly helpful in the way of not making people think too much before they purchase. Previously, I had to think about (or lookup) the prices in JPY to figure out if a print was within my budget or not. Now I have one less step, and you have one more opportunity to get a customer.

As to raising the prices: For the Senshafuda prints I don't think it's a problem at all. Make sure you evaluate your shipping costs again, as well, you don't want to be losing your margins on the shipping costs.

You might want to test out a floating USD price at some point - find a source (paypal?) for currency conversion data, and display a USD price that's based on a fixed JPY price, with real-time-ish currency pricing. That should give you a constant profit, while still allowing folks to see the price in USD, making the decision easier. I don't know if it would lose you customers or not, and implementing it may be harder than it's worth, but I suspect it's worth a think.

Following comment posted by: Dave on July 28, 2011 7:55 AM

move back to North America?

You know Marc, that actually wouldn't solve the problem, which is that I'm sourcing in the 'expensive' country (paper, woodblocks, etc.) and selling in the 'cheaper' country. If I were living there, as 'my' dollar slipped, I would be paying more and more to import the supplies!

... not making people think too much before they purchase

Exactly. In fact, this was the initial reason for me to make that switch (to pricing in $ on the website). I had learned over the years that a great many people over there have no idea at all what other currencies are worth, and because the yen is a 'multi-zero' currency, the prints 'look' very expensive when priced in yen.

real-time-ish currency pricing

I implemented this a year or so ago. Have a look at the 'master' order form page for all my subscription series. Many of the prices are linked, and the currency conversion that is displayed is in 'real time' (actually, it's updated with the 'noon rate' from one of the major banks).

I have no way to know if this is helping people, but I would certainly think so ...

Following comment posted by: Serge on July 29, 2011 11:48 PM

When you moved from Yen based prices to foreign currencies prices, we had a chat about what it meant for you, i.e. shifting all the risks to you instead of your customers. And you accepted that risk against better judgment.... If you believe that taking this risk is the direct result of the increase in customers, then it may be worth it, but personally I do not think so. Your customers come for the craftmanship and your art. The cost is not the deciding factor (within limits). I believe you should have a "floating" price when the exchange rate moves up or down by more than 10%. This would provide enough stability to your customers while reducing your financial exposure. And of course it should go both ways, up and down.... At least, you have some customers paying in Euro (like myself) where the "loss" is lower.
Kind regards.....Serge

Following comment posted by: Jacques on July 31, 2011 9:39 AM

The solution to Dave's current financial problem seems actually quite simple to me.

Why don't we all (i.e., all collectors and therefore lovers of his woodblock prints) living outside Japan right away switch to paying him in yen instead of dollars or euros (at least until the dust in the current economical sandstorm has settled down)?

I, for one, have always continued to pay Dave for his prints in Japanese yen.

If my proposed solution sounds wrong to you (or even downright crazy), please post your reason on Dave's RoundTable!

Following comment posted by: Dave on July 31, 2011 9:45 AM

Your customers come for the craftmanship and your art. The cost is not the deciding factor (within limits).

Just where those limits are is a very interesting question, to which I have no answer. During the year that I worked on the Beauties of Four Seasons project - with a price of 12,500 yen per print (around $135 at the time), subscriptions plummeted. Now that I'm at $35 per print, subscriptions are healthy. (Although interestingly, still not sold out, even at that insanely low price ...)

Why don't we all (i.e., all collectors and therefore lovers of his woodblock prints) living outside Japan right away switch to paying him in yen

Jacques, it's a very happy feeling to feel that you are so supportive (and concerned), but please don't 'worry' about this. When I switched to offering $ pricing, I absolutely and clearly understood the potential downside, and indeed, this slump in the $'s value is not unexpected at all. Even though I knew that I would lose out as it slumped bit by bit, I was gambling that it would increase subscriptions, and I think I 'won' that gamble. So please don't feel you have to take any corrective measures. In your case, it does indeed help that you are paying in yen (and I thank you for that!), but I am not willing to ask everybody to do the same. My finances this year - especially when compared to the previous three or four years - are doing very well (that's why I have been able to invest in the various Mokuhankan projects).

The bigger problem for me with the exchange rate - as I mentioned above - is not with my own work, but with the pricing of the Mokuhankan prints (the stuff I have to pay other people to produce). A weak dollar will severely damage the export side of that project, pretty much forcing me to 'look inward' and concentrate on making prints that will more closely suit the interests of people here in Japan.

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