Pricing your handmade crafts can either be a simple task or the most gut-wrenching, difficult decision you will ever have to make. It can be a deliberate, time-consuming calculation or an intuitive judgment call, or something in between! It is often much more difficult for someone who rarely sells their handicrafts to respond to a price inquiry than it is for professional crafter.

First of all, what is your motivation for selling the item? Are you hoping to make a profit, or are you just doing someone a favor? Are you planning that your hobby will eventually turn into a business? Are you helping a charitable organization raise funds? Answer all these questions and more in order to price your creations.

The very first question in any pricing situation is: What price will the market bear? This is how our economy works, and there is no way around it. So, with that in mind, do a little research. What are you making? What are other crafters pricing the same or a similar item? Can you make your craft at the market rate and still have a margin for profit? Do you even care about profit?

For example, say that a neighbor asks you to make a fluffy eyelash scarf like your handmade one she admires. If you do not care about profit, there are several options for you, such as: 1) Ask her to purchase the yarn and make the scarf as a favor. 2) Research scarf prices in your area and give her a comparable flat price that covers the cost of the materials and possibly some of your labor. 3) Charge her by the hour (rarely done!) or by the skein of yarn remember the total price will have to be within the market range for this type of scarf.

Low hassle simple formula - many professional crafters use a very basic and simple formula to price their goods. It reduces bookkeeping calculations and headaches just to multiply the supplies cost of a handmade item by three, and in some cases four. If the resulting price is competitive, great! If not, then adjust the price up or the costs down.

If you are making items for charity or fund raising, you still want your handmade items to sell at market price. It's a craft sale, not a flea market! If you drastically undercut other crafters' prices, you will most certainly make enemies and will not be doing your charity any favors either!

If you are relatively new at crafting as a business; again, do your research. Keep your prices within the acceptable range for whatever you are producing. If you are selling directly to the consumer, you will have a greater margin for profit. Also keep in mind:

1) other distribution channels (such as consignment shops, craft booths, home parties, etc.) that you may want to use. Leave room for price adjustments to compensate for consignments and fees.
2) the quality of your work (especially compared to like items). Is the quality perceived by the customer? If customers don't value the extra quality, they will not want to pay for it. Understanding this can also help you figure where and how to cut your costs too!
3) you may not always get a fair price for your labor. If your work is labor intensive, and your name is not world renown, then get used to this fact, and suck it up, literally! Balance your product offerings by adding small, easily produced items that have a high profit margin.
4) any advertising or other business overhead that will impact your prices and profits. Can you determine the benefit; is it worth the cost?

Good luck and keep up the good work!

Learn more about this author, Cindy Hartzell.
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