Floating around in the How Do I Price My Work universe is the formula of multiplying; doubling (2x), tripling (3x), or quadrupling (4x) your Cost Of Goods (materials and supplies used to make your item). I think this formula has been around since the first crafter sold an item to her sister, neighbor, or friend. It’s very basic and easy for those of us who are creative, but not so interested in complicated mathematical formulas. However, I think even if you use this type of pricing formula you need to make sure you are getting paid for your labor.
We have a silk flower arrangement to price. The Cost of Goods (COG) to make the arrangement was $15.00 and took 1 hour to make. You would like to earn $15 per hour. If you 2x the COG you’ll price the arrangement at $30.00 and you’ll just make your desired labor fee. Researching other similar floral arrangements you find that the average arrangement sells for $50.00 online, $45.00 in a mail order catalog, and $35 in craft stores. Consider your market (who you are selling to and where you are selling) and price your arrangement accordingly.
In this example the Multiplying Formula worked well, but that’s not always the case. Let’s say I’ve determined I wanted to earn $10.00 an hour. If I was selling bracelets with a COG of $2.00 and a labor cost of $5.00 (it took half an hour to make the bracelet) and I 2x the COG, I would price the bracelet at $4.00 and not earn the labor fee I wanted. If I 3x the COG to price the bracelet at $6.00, I still wouldn’t earn the labor fee I want – I’d need more than three times the COG to reach my desired $7 price. Bottom line is that the Multiplying Formula doesn’t always cover Cost of Goods, Labor, and Overhead so be sure to keep all those things in mind when pricing your crafts.
By: Maria Nerius, FaveCrafts.com Resident Craft Expert
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I definitely agree with what you said that it doesn’t always work out. I have a friend who made and sold baby blankets. She priced them by multiplying by 3. I don’t think she got what she was worth. Also, you could make a beautifully intricate and small piece with the COG very low. And like your bracelet example, the multiplying method would not be a very good idea. Thanks for the post! I’m in the process of making and pricing crocheted items for my first craft fair.
I agree. You have to price accordingly.
Wow. To be able to pay yourself $15/hour and be below fair market value? What can you make for that? All my yarnworks are “assume $5/hr, ad time cost to materials cost, and end up with something 3-10X what anyone wants to pay for the item.
I have a big question for you. I am attempting to start a small business of taking orders for custom made crocheted baby items. I haven’t got the slightest clue on how to charge for what I make. In my ads that I have placed I have said that I am flexible to the cost of the item, because it all depends on how much detail there is and how much bling they desire. I have made blessing/baptism gowns some I would charge maybe $20, that would be for just a plain gown, but then there are some that I would also charge $150 for. That type would be decked out with pearls,lace, flowers, and so forth. My question is this how do I determine how much to charge for outfits, and things of this nature. I have no idea how to price these types of things. I hope you can help me out. Thank You Kathy
I make personalized jewelry.
I have recently decided to add Bridal Accessories. This does includes Combs, Tiaras, Bridal Necklaces and Bracelets plus Shoeless Sandals, Earrings. Wedding Glasses with or without a giftbox (I do the satin lining and gift wrapping). I am also doing Unity Candles and Tapers all decorated. Birdcage Veils. I plan on doing other Veils too.
I can price the jewelry. The decorated glasses sell here for $40. Canadian.
Tiaras, Combs, Birdcage Veils are where I need help.