So I thought over the coming weeks I would discuss some common pricing strategies that you can apply to your handmade items. Choose the one that works for you. And don’t be afraid to try different strategies. This week’s strategy is:
Cost Plus a Wage
This is how most crafters start as it is a comfortable progression for most people given their familiarity with being paid by the hour. The fundamental premise here is that you work out what you materials cost you to make the item, and then calculate how long it takes for you to make the item. Then multiply that time by your hourly rate. This is a very logical place to start, as long as you charge for your time. You see most crafters undervalue their time, because they think ‘oh well it’s fun anyway so I don’t need to charge much’. Wrong! You will always have a hobby if you choose this route – never a business or a real income. You are better going back to your day job. Ok so maybe you don’t want to charge yourself out at your normal day job rate, but don’t sell yourself short (i.e.. make sure it’s above minimum wage!).
Next week will discuss the second method of pricing. If you want to make sure you receive it straight to your inbox, hot off the press, be sure to subscribe via email or RSS in the column on your right.
To Read Part 2 Click here