Shop Talk: How to Price Handmade Goods

Handmade Hang Tags

Earlier this week, I talked a bit about the pricing of handmade goods. That post explains a little bit about why handmade items cost what they do, but a Facebook friend brought up a great point: many crafters underprice their items, and it’s probably because they haven’t done the math.

I know that it took me quite some time to figure out how to price my goods. If you’re interested in my formula, here it is:

cost of materials + (hourly wage)(number of hours) = wholesale price

My formula for retail price varies a bit. A lot of folks just double the wholesale price, but I don’t always do that. A fellow crafter mentioned that her wholesale price is around 60% of her retail, and that feels a bit more right to me. I think it’s a matter of weighing your cost versus what the retail market will bear.

It’s a pretty simplistic formula, and there are other ones out there that you might want to take a peek at, too. Here are some good resources for finding the right price for your items:

So, my crafty pals, do you think you’ve been pricing your goods appropriately? It took me ages to come up with prices that I felt comfortable with, and I’m still tinkering with my formula a bit.

Image Credit: Creative Commons photo by heatherknitz

5 comments on “Shop Talk: How to Price Handmade Goods
  1. Playing World of Warcraft sort of taught me that. With a lot of items, you can charge 30% more than what it cost to make it (not including work fees since it’s quick in WoW, and not work hah). 60% is ideal. 70% and people start to feel like they’re being ripped. Unless of course it’s rare etc, then you’re selling it based purely on desire to be acquired. But thats for items that are semi-common and in some demand. 30% is more what you’d sell the extras at if it’s an item you acquired and didn’t craft.

    Just because you had bookmarks up there; I read a quote once, I’ll paraphrase it “Why spend a dollar on a book mark? Use the dollar as a bookmark.”. Ever since then I’ve had a hard time buying bookmarks that cost more than a dollar. It makes me wonder how much it really costs to make bookmarks. Of course I can see charging more if it’s one of the kind in plastic sleeves.

  2. I have to agree with Becky. I price my handmade at a fair wage (closer to $15/hr as well). The way I get sales is by doing a bunch in trade, and doing payment plans- one woman is going to model for some photos in exchange for a custom skirt (she’s also buying the fabric). I have a tendency to offer these options when I see people hesitate. I don’t want people to think they can’t afford handmade goods, just because they don’t have cash.

  3. i was told once that all artist should charge at least $10/hour for their labour.. is that what you do? (LOVE this post by the way!!) will repost @remakeable when i have a chance

    • I think $10/hour is a bit low! I charge closer to $15/hour. $10/hour doesn’t seem like a sustainable salary to me in terms of a career, after taxes and whatnot, you know what I mean?

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