by Sig Wynne-Evans

Created on: February 14, 2010

How to price handmade craft items for sale is a delicate balance. The item needs to be priced so that it has an attractive price, and it also needs to sell high enough to cover costs and make the crafter a bit of money.

Since I am most familiar with the craft of beadworking, I will use examples from the craft of beadwork, but nearly any craft can be applied to my examples.

To get a general idea of the range of prices your beadwork sells for, find a bead artist who is doing well, has been in galleries, and in shows. Also check prices on line in various venues such as Ebay and Etsy.  Find the lowest price points and the highest. Likely, the higher prices will be of beadwork from a well known and skilled artist who creates her own designs. Strive to come in line with that artist. Sure, you might not think you are as good or as well known But that doesn’t mean that your work has no merit. Think along the price lines of the artist you admire most. You might one day become as skilled as the artist you admire.

Then use a general guide used by the arts and crafts industry:

Wholesale= 3X the cost of materials plus hourly wage. Wholesale price is generally ½ of retail. 

Cost of materials includes beads, thread, storage, cost of display, ads, computer and other selling charges, taxes to be paid on income…in short anything and everything that the IRS will allow you to deduct as a business expense.

 While using this formula is not the end all to pricing, it should at least make you consider the full tangible costs of creating your product. Also consider the intangible costs. Did you take classes to learn your skill? How many hours of practice did it take for you to become proficient enough finally consider selling your first item.

So, now for a more definitive example: 

If you made a pair of earrings, and sold them inexpensively at $10, and you sold 25 of them, you would make $250. Taking out expenses lets say you clear $125 (50%). Now lets suppose you sell the SAME earrings at $25. And lets say you sell 5 of them. You bring in $125. With a profit of $62. Your profit would be half based on materials alone. Now take into consideration the TIME spent. Lets say that these earrings took you 2 hours to make. In the first example, it takes you 50 hours (25 pairs of earrings X 2 hours each). Divide the $125 by 50 hours and your hourly pay is $2.5 per hour.

For the second example, at 5 pairs of earrings X 2 hours= 10 hours. $62 / 10 hours= $6.20 per hour. If you really consider this, in the first example you might have the thrill of selling 5 times as many earrings, but you are working at a much lower paid rate.

In the second example, you have not sold as much, but you are working at a higher rate, and you have more earrings left for your next show, and don’t have to work as hard to maintain your inventory.

Which conditions would YOU prefer?

Put all this together and those little earrings, that little pattern with all the diagrams, and photos should really be reflective of your talent, skill and artistry. Don’t sell yourself or the beading community short.

Now go forth, create, sell, and don’t be afraid to get what you so rightly deserve!

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