How to Price Crafts for Sale
Research the market for the craft you plan to sell., Work with your numbers., Determine the cost of your labor., Calculate the overhead costs for making your crafts., Check your totals.
Step-by-Step Guide
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Step 1: Research the market for the craft you plan to sell.
Take the nature of the item, the quality of the work and the location where it is sold into consideration.
Pricing higher than equivalent items on the market will result in low sales.
Pricing considerably lower will result in low or no profit.
Use your research to determine which market you will target (for example, online buyers or craft fairs) and how much the buyers in the market are willing to pay for your craft. -
Step 2: Work with your numbers.
It is important to know exactly how much you will make from each sale.
Create a list of all of the materials used to create and sell the product.
Include shipping costs and advertising, if applicable.
Determine the total expense from the list.
You will use this amount as a base for the selling price. , This area is typically calculated on a more personal basis.
Estimate how long it takes to make one item.
Calculate how many items you can produce in one hour.
Decide how much money you wish to earn per hour of creating crafts.
Divide that amount by the number of items you can produce in one hour and the quotient will be your labor cost to add to the price.
For example, if you wish to earn $15 per hour and you can make 5 crafts in one hour, you will add $3 to the expense total for each item. , Although most crafters work from home, there is still an overhead cost to consider.
Consider the electricity, water and household items used to make the product.
If you have an office or room where you work, divide your power bill by the square footage in your home.
Multiply the amount of power for each square foot by the number of square feet in your office.
This will give you an estimated cost of how much the electricity for your office costs you each month. , Gain a total amount for the material expense, labor and overhead.
See how the total compares to the selling rate on the market.
If the total is more than the average selling price, you will need to re-examine your numbers and look to make some cuts.
Can you buy items cheaper? Is your labor reasonable? If the total is lower than the average, then you can add more to your cost for added profit. -
Step 3: Determine the cost of your labor.
-
Step 4: Calculate the overhead costs for making your crafts.
-
Step 5: Check your totals.
Detailed Guide
Take the nature of the item, the quality of the work and the location where it is sold into consideration.
Pricing higher than equivalent items on the market will result in low sales.
Pricing considerably lower will result in low or no profit.
Use your research to determine which market you will target (for example, online buyers or craft fairs) and how much the buyers in the market are willing to pay for your craft.
It is important to know exactly how much you will make from each sale.
Create a list of all of the materials used to create and sell the product.
Include shipping costs and advertising, if applicable.
Determine the total expense from the list.
You will use this amount as a base for the selling price. , This area is typically calculated on a more personal basis.
Estimate how long it takes to make one item.
Calculate how many items you can produce in one hour.
Decide how much money you wish to earn per hour of creating crafts.
Divide that amount by the number of items you can produce in one hour and the quotient will be your labor cost to add to the price.
For example, if you wish to earn $15 per hour and you can make 5 crafts in one hour, you will add $3 to the expense total for each item. , Although most crafters work from home, there is still an overhead cost to consider.
Consider the electricity, water and household items used to make the product.
If you have an office or room where you work, divide your power bill by the square footage in your home.
Multiply the amount of power for each square foot by the number of square feet in your office.
This will give you an estimated cost of how much the electricity for your office costs you each month. , Gain a total amount for the material expense, labor and overhead.
See how the total compares to the selling rate on the market.
If the total is more than the average selling price, you will need to re-examine your numbers and look to make some cuts.
Can you buy items cheaper? Is your labor reasonable? If the total is lower than the average, then you can add more to your cost for added profit.
About the Author
Samuel Moore
Writer and educator with a focus on practical creative arts knowledge.
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