Deciding what to price your craft products seems to be the one thing that puts a pause in many people’s plans. How much should you charge? You don’t want to put too high of a price on your work because you want to make sales and people have been pinching their pennies particularly hard these days. You also don’t want to undersell yourself either. You worked hard, you want to get paid fairly. What I’ve found that many craft business owners do is follow a formula to calculate how much they should be charging. I found this awesome formula on the Etsy blog.
The Pricing Formula:
Materials + Labor + Expenses + Profit = Wholesale x 2 = Retail
Makes sense doesn’t it? Or at least it seems to. Here’s a little break down of the pricing formula:
Materials – this is exactly what it sounds like. The cost of your materials is an important part of what your price will be.
Labor – how much would you like to be getting paid an hour? This is how you would calculate your labor costs. Don’t pick a number out of thin air though. We’d all love to be making $100 an hour, but that’s not realistic. Do some online research and see how much a seamstress or a jewelry designer makes and hour, this will be your starting point.
Expenses – every penny you spend on your business should be accounted for in the price of your product.
To see a full break down of the pricing formula, check out the full article on the Etsy blog and get your items priced and on the market!