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TRANSCRIPT
The Art of Pricing Handmade Goods 2011
Contents How Much Time Are You Really Spending on Your Product 3
Pricing For Time Intensive Handmade Items 10
How much is your experience worth 13
Pricing your Handmade Jewelry 14
Pricing Your Products The 411 16
Pricing Woes 17
The Breakdown 17
Material Costs 17
Labor Cost 17
Overhead Cost 17
Profit 17
Markup 17
2 Prices per Product 18
Successful Holiday Price Point Strategies 18
The Art of Pricing More Important AND Less Stress-Worthy Than You Think 20
How exactly do we decide whether an item is for us based on its price 20
What are the implications of our built-in assumption that high price means high value and vice
versa 21
Guidelines for ridding yourself of pricing anxiety forever 22
What have we learned 22
10 more must read pricing articles 23
The Art of Pricing Handmade Goods 2011
How Much Time Are You Really Spending on Your Product
Abacus Hands Antique Calculator Digital Image Download Sheet
Pricing How Much Time Are You Really Spending on Your Product
We all know the formula
Cost Price (Labor + Materials Cost) x 2 = Wholesale Price
Wholesale Price x 2 = Retail Price
But what goes into the cost of our labor
Time
A day in the life of an Etsy Item
Aside from what you spend on supplies and incidentals which is relatively easy to track what
about the time you put in If you are like me you do not weigh time heavily into the equation
because you are so happy while you are in creative mode and you forget about all of the other
stuff Recently I have taken a hard look at my time management for pricing purposes and life in
general
The Art of Pricing Handmade Goods 2011
Sad but true time is money even when it feels like you should be paying someone for the
happiness you get from making jewelry
Lets look at one little piece of jewelry and all it has to go through to get into the hands or onto
ears or necks of my customer (not exactly in order of appearance)
Little Piece of Jewelry
The research process ndash this is what I like to call it when I am daydreaming up new ideas
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
Contents How Much Time Are You Really Spending on Your Product 3
Pricing For Time Intensive Handmade Items 10
How much is your experience worth 13
Pricing your Handmade Jewelry 14
Pricing Your Products The 411 16
Pricing Woes 17
The Breakdown 17
Material Costs 17
Labor Cost 17
Overhead Cost 17
Profit 17
Markup 17
2 Prices per Product 18
Successful Holiday Price Point Strategies 18
The Art of Pricing More Important AND Less Stress-Worthy Than You Think 20
How exactly do we decide whether an item is for us based on its price 20
What are the implications of our built-in assumption that high price means high value and vice
versa 21
Guidelines for ridding yourself of pricing anxiety forever 22
What have we learned 22
10 more must read pricing articles 23
The Art of Pricing Handmade Goods 2011
How Much Time Are You Really Spending on Your Product
Abacus Hands Antique Calculator Digital Image Download Sheet
Pricing How Much Time Are You Really Spending on Your Product
We all know the formula
Cost Price (Labor + Materials Cost) x 2 = Wholesale Price
Wholesale Price x 2 = Retail Price
But what goes into the cost of our labor
Time
A day in the life of an Etsy Item
Aside from what you spend on supplies and incidentals which is relatively easy to track what
about the time you put in If you are like me you do not weigh time heavily into the equation
because you are so happy while you are in creative mode and you forget about all of the other
stuff Recently I have taken a hard look at my time management for pricing purposes and life in
general
The Art of Pricing Handmade Goods 2011
Sad but true time is money even when it feels like you should be paying someone for the
happiness you get from making jewelry
Lets look at one little piece of jewelry and all it has to go through to get into the hands or onto
ears or necks of my customer (not exactly in order of appearance)
Little Piece of Jewelry
The research process ndash this is what I like to call it when I am daydreaming up new ideas
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
How Much Time Are You Really Spending on Your Product
Abacus Hands Antique Calculator Digital Image Download Sheet
Pricing How Much Time Are You Really Spending on Your Product
We all know the formula
Cost Price (Labor + Materials Cost) x 2 = Wholesale Price
Wholesale Price x 2 = Retail Price
But what goes into the cost of our labor
Time
A day in the life of an Etsy Item
Aside from what you spend on supplies and incidentals which is relatively easy to track what
about the time you put in If you are like me you do not weigh time heavily into the equation
because you are so happy while you are in creative mode and you forget about all of the other
stuff Recently I have taken a hard look at my time management for pricing purposes and life in
general
The Art of Pricing Handmade Goods 2011
Sad but true time is money even when it feels like you should be paying someone for the
happiness you get from making jewelry
Lets look at one little piece of jewelry and all it has to go through to get into the hands or onto
ears or necks of my customer (not exactly in order of appearance)
Little Piece of Jewelry
The research process ndash this is what I like to call it when I am daydreaming up new ideas
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
We all know the formula
Cost Price (Labor + Materials Cost) x 2 = Wholesale Price
Wholesale Price x 2 = Retail Price
But what goes into the cost of our labor
Time
A day in the life of an Etsy Item
Aside from what you spend on supplies and incidentals which is relatively easy to track what
about the time you put in If you are like me you do not weigh time heavily into the equation
because you are so happy while you are in creative mode and you forget about all of the other
stuff Recently I have taken a hard look at my time management for pricing purposes and life in
general
The Art of Pricing Handmade Goods 2011
Sad but true time is money even when it feels like you should be paying someone for the
happiness you get from making jewelry
Lets look at one little piece of jewelry and all it has to go through to get into the hands or onto
ears or necks of my customer (not exactly in order of appearance)
Little Piece of Jewelry
The research process ndash this is what I like to call it when I am daydreaming up new ideas
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Sad but true time is money even when it feels like you should be paying someone for the
happiness you get from making jewelry
Lets look at one little piece of jewelry and all it has to go through to get into the hands or onto
ears or necks of my customer (not exactly in order of appearance)
Little Piece of Jewelry
The research process ndash this is what I like to call it when I am daydreaming up new ideas
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The sketch ndash you can skip this part if you do not need to sketch but I do Here are your
five minutes back if you donrsquot
Learning and practicing techniques or how the heck do I make this This can include
time spent in trial and error in courses reading books taking Ecourses or tutorials
Ordering or shopping for Supplies
The actual designing process
Actually fabricating your piece
Modeling it for your significant other or furbaby and telling them they are not excited
enough about this new creation
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Not Really Me
Photographing it
The dreaded editing of said photographs
Determining pricing which includes more dreaded research and yikes math
The even more dreaded listing of item
Answering stupid and not so stupid convos
Tweeting FB-ing Stumbling Deliciousing Stylehiving Pinteresting Kaboodling
Blogging making the dreaded Treasury (I make them but I donrsquot like them)
commenting on Trsquos and more
Doing all of the above for your team members as they have done for you
Messing with Etsy on Sale Should I shouldnrsquot I etc
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
Promoting your sale if you chose ldquoI shouldrdquo
Rearranging your Etsy store obsessively
Renewing
Checking Craftopolis
Reading Handemadeology
Checking Google Analytics and wondering if anyone really understands it
Worrying about your SEO and asking Bob a lot of questions 1800-jewelry24Seven
Creating and promoting coupons or wondering if you should
Finally a sale
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Continuing onhellip
Ordering or shopping for packing supplies
Putting your precious piece into pretty packaging that you ordered or made
Packing for safe shipping
Printing a label cursing at printer amp(( (__$^amp
Fixing the printer or running to Staples for more printer ink
Printing again
Going to the post office
Swearing I am going to get more organized so I can arrange home pick up which is
FREE
Following up emails (yup you bought it yeah its coming etc)
Worst case tracking a package uuugghhhhhh
Best case happy customer brilliant feedback Yayyy
Guess what time to start all over again
All of this is not even factoring in the very important time spent on the JET Thread
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
Is your pricing right
Do not sell yourself short Much of the cost of doing business is our time
Thanks for reading
Norah
Pricing For Time Intensive Handmade Items
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Large Black Nine Pointed Star Paper Quilled Earrings
Article by Honeyrsquos Quilling
If you are like me you have read dozens of articles posts and comments on how to price your
handcrafted items And if you are like me you have been confused more often than not The
number one thing I have learned is that there is not one single formula that will give everyone the
right pricing technique Each type of handcrafted item is created differently Some are made with
expensive jewels some with cotton yarns Some take a few minutes to put together while for
some it is the time invested that gives them value
This article is geared towards those who create handcrafted items that are time intensive I will
share how I have priced my items that fall into this category and what I have learned along the
way
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
When thinking about how to fairly price your crafts you must take into consideration both the
cost of your materials and the cost of your time There are many pricing formulas out there that
only use the cost of materials to figure out the price That obviously will not work for time
intensive crafts because you will not be getting paid for your time at all Then there are other
formulas that have you add in your time cost plus material costs and double triple or even
quadruple that to get your wholesale price Again this will not work for time intensive crafts
You will find yourself with over-inflated prices and no buyers
The key to the right pricing formula is to make sure you are getting paid for your time for your
materials plus any overhead costs This is the formula that I have come up with after months of
tweaking
[(time x $per hour) + 2(cost of materials)] x 11 = wholesale price
wholesale price x 2 = retail price
How much you should pay yourself per hour is up to you Irsquove seen a lot of advice saying that
the bare minimum should be $10 so that is what I have started with for myself Irsquom sure I will
increase that as time goes on The reason I double my materials cost is because there are always
overhead costs Having materials shipped to you some materials getting ruined materials you
use that you donrsquot know how to calculate such as glue I figure these are all covered by doubling
my materials cost Then I multiply by 11 to add 10 to my wholesale price I do this to give
myself a little profit and a little wiggle room There are always overhead costs such as electricity
that are hard to calculate in This gives you that room Plus even if you are selling wholesale itrsquos
great to be able to get a little profit from those deals You can then use this to re-invest in more
supplies I choose 10 as my profit markup but you can put whatever you feel comfortable
with
If you are planning on trying to get some wholesale accounts you definitely have to double your
wholesale price to get to your retail prices Most retailers will expect to get your goods at half
price This retail price is then what you should be charging customers
When I first applied this formula to my items I gasped a bit at the prices I asked myself ldquowho
would pay thatrdquo But then I took the advice of many crafters and artists and reminded myself
that those who cannot make what you make WILL pay that price for it I know I look at many
crafts that I do not have the skills for and Irsquom happy to purchase their items because they are
well made gorgeous and itrsquos awesome to buy handmade And I know others buy my products
for the same reason
Another thing to consider is the costs such as advertising listing on etsy renewing listings time
it takes to photograph packing and numerous other expenses I figure that because I am
charging retail price in my shops I am covering those costs So basically my ldquoprofitsrdquo are really
the costs for all of that When I sell wholesale I donrsquot have those costs so I donrsquot feel
comfortable adding in those costs to the wholesale price But some people do so feel free
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
I consider my pricing formula to be very flexible Once you have a formula that works for you
and your craft and you are happy with your prices you can leave it for a while But if you feel it
needs some tweaking ndash maybe you find your overhead costs not covered or maybe you decide to
start putting your marketing and photographing hours into your time (something I have not done
yet) ndash go ahead and tweak it
If you create time intensive handcrafted items I hope you have found this article helpful Let me
know what your pricing challenges are and how you are handling them Happy pricing and
happy selling
How much is your experience worth
Children Art Dancer Mexico
I attended a watercolor art class a few years ago The teacher demonstrated his techniques while
we watched and then we attempted our own paintings During the class he told us that he would
sell the demo paintings to us for $350 if we would like to buy them
Someone in the class actually had the courage to say ldquoHow can you sell that painting for $350
when it only took you 25 minutes to paint itrdquo He answered ldquoIt took me 30 years to paint that in
25 minutesrdquo
Irsquove always remembered that and it has given me courage to price my items in a way that
includes my experience Even if my materials are low cost and even if I can make that thing in
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
15 minutes no one has seen the ones in the trash or the ones I wonrsquot sell or the ones that I made
in the beginning We all grow as artists and we need to value our skill and experience
I canrsquot remember not knowing how to sew I learned from my mother as she sewed my dresses
and my Barbie Dollrsquos dresses Irsquove made over a hundred purses totes and wristlets since last year
when I started experimenting with them An interesting thing happens when you make that
many ndash your voice starts to emerge People can tell those items are made by me The consistency
and quality of the end-product has also improved and my prices reflect that
Itrsquos a tricky thing this pricing business Whole books have been written about pricing strategy
Whew As long as I am respectful of my fellow artists and respectful of my own skills I think
Irsquom on the right track
Pricing your Handmade Jewelry
Final Sale - Fine Art Photography Original Print (8x10) IN STOCK |by elr104
By Jacqueline Jewelry
Letrsquos start 2011 right and stop being afraid to charge prices for your jewelry that show you are a
professional Even if yoursquore new to the craft of jewelry you should be pricing for the luxury that
jewelry is One mistake that new jewelry designers often make is to price their work too low
Pricing handmade jewelry seems to one topic that jewelry artists seem never to agree on There
are lots of different viewpoints and philosophies This article will discuss some of the things to
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
think about as you consider how to price your jewelry and some of the common pricing models
that jewelry designers use
Keep in mind that you do much more than make jewelry as a business owner In order to cover
costs and overhead it is essential to charge more than your hourly rate + material costs or keep
your hourly rate on the high side (ie $20 hour is much more realistic than $10 hour) if you
want your business to be profitable
Here are a few pricing tips
bull Donrsquot compete with imports on pricing Your quality is better and you can never compete with
those that make $2 a day Instead position yourself as the high quality jeweler that you are and
command reasonable prices
bull As a newcomer you can start lower if you would like and move your pricing up as you
become more established
bull Lower pricing also can work against you because it cheapens the perceived value of your work
People tend to think you get what you pay for so if you charge too low people tend to think
something is ldquofishyrdquo if the price is lower than they expect for a handmade object
I have another reason for not charging too low This is kind of my personal soapbox
If you charge too low you are not only cheapening the perceived value of your own work you
are also cheapening the work of others because the public learns to think that some jewelers who
charge what they are worth are charging too much
Those jewelers who charge what they are worth then have to work so much harder to convince
customers that their work is worth the cost
That said as a jewelry designer you need to consider two types of pricing wholesale and retail
Wholesale and Retail Pricing Models
Here are common wholesale pricing models used by jewelry designers
bull 3 x the material cost
bull 35 x the material cost
bull $20hour bull labor plus 1x materials plus 50 (or whatever you want your hourly wage to be)
bull Eyeballing ie guessing at what it should be worth (not recommended but common)
bull $35hour bull labor plus 1x materials
bull $26hour bull labor plus 1x materials plus 50
bull $20hrlabor + mat + 5overhead + 20profit
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
And here are common retail pricing models used by jewelry designers
bull 14 x wholesale
bull 15 x wholesale
bull 16 x wholesale
bull 17 x wholesale
bull 18 x wholesale
bull 19 x wholesale
bull 20 x wholesale
bull The ever common but not recommended ldquoeyeballingrdquo method
Feel free to use any of the wholesale or retail pricing formulas to price your own work
Remember that customers are not only buying the materials in a piece of jewelry and the time
you spent making it theyrsquore buying your unique vision and expertise
Original article gt Jacqueline Jewelry
Pricing Your Products The 411
image courtesy of D Lippens on Etsy
So first off what does ldquothe 411Prime mean I remember that little saying from middle school amp that
was like so 15 years ago Whoa that makes me feel oldWeird
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Pricing Woes
Anyway pricing products is always a struggle At least for me it is You have to consider so
many different factors amp it varies depending upon what your selling amp the value associated with
your product Ugghh
Well I just found a little pricing formula that helped me recently so I changed all my prices in
my shop amp honestly Irsquom still deciding what I think about it Irsquom still getting traffic amp some sales
but not as many as I was before Irsquom in the process of continuing to evaluate my market amp my
competitors Eventually Irsquoll know if it was a good move or not
The Breakdown
My next post will be actually showing you the pricing formula but today I wanna talk about the
parts of the formula you need to consider So letrsquos get started
Material Costs
This is the cost of each amp every material that is directly used to make your product including
packaging materials amp marketing materials used with the product
Labor Cost
This is the cost to make the product whether itrsquos you making the product or an employee making
the product This is usually the trickiest part because we tend to price our time on the high end
which in the end can make our products price unrealistic
Remember when thinking of labor costs how much do you want to make or pay an hour amp
how long does it take to make the product start to finish
Overhead Cost
This is everything else other than material amp labor costs I can be rent marketing expences
tools equipment electricity internet phone services etc
Profit
This is what you make after yoursquove paid all your expenses
Markup
This is a percentage of the materials ampor labor cost thatrsquos added to reach a price
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
2 Prices per Product
Now some of you may not realize that each of your products actually has 2 prices Therersquos a
wholesale price amp a retail price to considerhellipthat is unless yoursquore not interested in wholesaling at
allhellipthen yoursquod only have one price
So until the next post with the actual formulahelliptell mehellip
What pricing issues do you struggle with in your business Let me know in the comments
below
Successful Holiday Price Point Strategies
Gift Wrap Option by megandarienzo on Etsy
This will be my fourth holiday season on Etsy and I have learned a lot of valuable lessons
during my tenure in the glitter-filled trenches No matter how many times I run errands or order
packing materials I will always run out when I need them the most I have learned to take lots
of salt baths and to ice my hands and shoulders so I donrsquot come out of my studio in January
looking like a hunchback My husband can (and will) sew on buttons and pom poms in a pinch
Shipping orders from home will save you SO much stress just do it Most importantly Irsquove
learned that establishing a variety of strategic price points in my shop will lead to the most
success making all the hair-pulling stress and insanity of the busiest shopping season
worthwhile
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Most of us have items at least a few different prices in our shop Make a list of pricing categories
in your shop and spend a few minutes considering who will buy items in each price range Irsquom
often looking to spend a set amount on a friend or family member ndash $25 $50 or $100 If you
have several items priced just above $50 or $100 consider adjusting your prices slightly to
appeal to those with a set budget in mind Also consider bundling lower priced items into gift
sets to appeal to those wanting more bang for their buck but also wanting to spend a set amount
Irsquove put several times together at a small discount with combined shipping and found that $50
and $100 price points are more popular during the holidays than I thought While many people
shopping in a mall are attracted to $10 and under times I very rarely sell low priced items in my
shop during the holidays Most people donrsquot want to pay shipping on a low cost item so
bundling can be a good way to offer several lower priced items with combined shipping
Many shoppers love to buy multiples so make sure to up your item quantity for listings for
custom items I have had a single individual purchase 10 custom pet portraits for each member of
his family It worked well for him because he could get everyone in his family something
thoughtful and handmade and he was done with his holiday shopping in one quick click
Responding quickly to conversations and requests to purchase multiple items is a great way to
make the most out of shoppers looking for a swift gift solution Catching people while their
interest is on your shop is crucial because Irsquove found many gift seekers tend to move on more
quickly than those shopping for themselves
Gift certificates are a great way to catch last minute shoppers or those who want to purchase a
custom item for a friend but arenrsquot sure of their size or preference I have offered very specific
gift certificates in the past not just for dollar amounts but for a custom pet portrait or custom pet
sweater and hat set Irsquove found these to be much more popular than general gift certificates I
also provide customers with a printed certificate explaining the item and a pdf version via email
for those who leave shopping down to the wire
Offer free gift wrapping OR sell it as a separate service I purchased from a seller once who
offered one style of wrapping included in the price and a second more elaborate wrapping as a
separate sale I opted for the fancier packaging and was really pleased with the result While I
have not had time to offer add-ons like dressed up packaging in my shop during the holidays I
would definitely recommend it to those who are able You might be surprised by how many
people want the same unique artistry in gift wrapping that they do in the item they purchase It
was very attractive to me as a buyer and the seller was able to earn an extra $5-10 on some
purchases
Finally donrsquot feel like you have to have bargain basement prices to be competitive If you invest
time and energy in cultivating a unique and polished look for your shop you should be able to
attract buyers willing to pay what your items are worth You can make more selling less and will
be happier and healthier as a result There will always be those out there who are practically
selling their items at a loss but they wonrsquot be able to sustain their business in the long term As a
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
group of independent artists and business owners we should stick together and set a standard for
selling handmade
The Art of Pricing More Important AND Less Stress-Worthy Than You
Think
I believe that pricing is as important to a stores brand identity as its color scheme product
photography style or the personality of its copy Still I think that store owners manage to freak
out about their pricing structure more than is necessary
Some big statements I know so let me explain
The price of items we see in stores-- physical and online-- affect us psychologically in 2 quite
prominent ways
1) They alert us to whether or not an item is for us
2) They tip us off to an items value-- seeing as how we naturally correlate high price with high
value (and vice versa)
How exactly do we decide whether an item is for us based on its price
I know most people like to dive into the affordability talk here but I have a different take
Afford is such an ambiguous word to me
Can I afford a piece of gum for $100 Well technically I have $100 So by definition I can
But is that particular piece of gum worth $100 to me That is a different question
This is why I prefer to speak in terms of priority and value instead
Lets say one potential customer has an income of $40K She has preferences and priorities as
well as limits on what she is able to buy Its all a matter of priority
If owning a fantastic $100 pair of jeans is of high value to her personally shell splurge on the
$100 pair while snipping coupons for groceries Shell avoid eating out Some kind of sacrifice
can be made
If said customer is however highly conditioned to spend around $30 for a pair of jeans and
doesnt easily see $70 worth of added value in the more expensive pair she will shrug it off as
not for her
To show you how this concept scales lets assume another potential customer has an income of
$140K Though she still has preferences and priorities she has clearance to satisfy more of her
desires
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
Assuming she also sees high value in owning a $100 pair of jeans she can buy a pair without
needing to snip coupons to balance the purchase
Still she cant very well buy $100 pairs of jeans loads of diamond jewelry a full-time waitstaff
lavish tropical vacations etc etc she would quickly run out of money Therefore she is still
making decisions based on her priorities She just has more lee-way than someone with a lower
income
How does all of this relate to you as a business owner Simple There is virtually no such
thing as unaffordable As long as a persons basic needs are being met and they are able to
see the value in your offering they will buy They will make it a priority
What are the implications of our built-in assumption that high price means high value and
vice versa
Have you ever glanced at the price of an item and thought Wow That must be good
I know I have
A hefty price tag alerts us to the fact that someone has declared an item high value In a world
too full of scams and deception we probably shouldnt be as open to this mental suggestion as
we are but it is extremely prevalent in our thinking
Its simply a matter of how were wired we use other peoples opinions and reactions in order to
shape our own This is how in the past we were able to avoid poisonous berries and not die
Really basic human stuff
On the flip side of the coin we tend to have a negative reaction to certain low-priced goods
Have you ever been interested in an item checked the price and then thought Whats wrong
with this that its so cheap
You certainly wouldnt be alone
Commoditized goods like name brand electronics clothes and accessories are consistent enough
in quality that we can buy them cheaply and feel okay about it However when dealing with
non-commoditized goods (handmade being a fabulous example) the outcome is not as
predictable
Since your product is neither coming off an assembly line nor ubiquitous to every neighborhood
mall people cannot be certain of what theyre getting So price as a means of value-measure
matters a great deal
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
Guidelines for ridding yourself of pricing anxiety forever
If youre like most handmade store owners you have probably spent WAY too much time
fretting over the affordability of the items you sell Now that you know a lower price is not
always better-- and due to human nature itself can actually hurt your sales-- I hope you will
never again feel burdened by the need to price-match commoditized goods
So whats the right stress-free way to price
Well there are no hard-and-fast rules Thats for certain
But since non-answers are rarely helpful let me give you a guideline to get you started
Add up your overhead business costs materials tools listingprocessing fees web hosting etc
Next assign yourself an hourly wage (When doing so consider the fact that being self-
employed requires you to provide your own benefits-- unlike most standard jobs-- and add to the
figure accordingly) Calculate the amount of overhead and time that goes into a single item
Now double it
This is a figure you can start with that includes your overhead the amount you must be paid for
your time and some added profit to fund the growth of your business
Dont go below this number but do add to it for any highly novel or artistic value in your work
Also raise your price if you find that demand is quite high This will curb in-coming orders
enough for you to comfortably keep up-- without stunting your profitability
What have we learned
Today Ive covered the myth of affordability how people buy based on priorities and perceived
value instead why handmade goods should never be priced as low as commoditized ones why
most store owners are stressin way too much and how to get started on your new pricing
structure
If you have found this information helpful or have any questions let us know in the comments
below
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo
The Art of Pricing Handmade Goods 2011
10 more must read pricing articles
The Art of Pricing Three Helpful Pricing Exercises
Pricing Tips for Your Creative Business
Etsy Success Reevaluating Your Prices
How to Price Your Handmade Goods - Items
How to Price Your Handmade Products Download a Free Pricing Calculator
Jewelry Pricing Formula
Etsy and the culture of cheap
How Much Is Handmade Worth
Why Handmade is so ldquoExpensiverdquo