Deciding on how to price your crafts is an important factor when beginning your crafting business. The price of your crafts will increase or decrease the amount of customers who will buy your crafts.
The price can be determined through several different factors, including your own calculations, as well as the environment in which you are selling them and how this relates to other craft businesses as well as customers.
Here are five ways to help you determine the prices that you can offer when determining how to price your crafts.
1. Do the Math
The first step to this is estimating the amount of time you spend making the craft, first by hour, then by week. Decide how much you would like to make per week from your labor. If you want to be specific, you can add in factors such as what you need to make a living comfortably. The next step is to add in the total cost of supplies that you use. Add this to how many products you are making per week. Divide the number of products produced in a week by the total cost for labor. This will determine how much you should sell each product for.
2. Research Your Craft
It is always good to find out what other similar products and craft businesses are charging for their products. Because they are hand-crafted, however, you should be able to go either a little above their price, or may decide to go a little under and offer your customers a discount. If you have a craft that you can not find anywhere else to compare to, then find an average of similar products to average out your costs with.
3. Find Inexpensive Craft Supplies
If you have determined your pricing and it is above what you would like to sell your crafts for, there are ways to cut costs for what you are making. One way to do so is by changing the supplies that you are using. Discount stores often offer the same brands and quality of supplies at a lower price. You may also want to look into places that are going out-of-business. They usually have large sales for you to stock up your supplies with. You can also use wholesalers or can browse through the internet for those wanting to sell craft supplies at a discounted rate.
4. Make Sure You Are Listed As a Business
By considering yourself a small business, you can apply for a tax ID that will cut taxes off of your supplies. You can apply for a tax ID through the government website. You can then either save your receipts for tax time or see if certain places will take the tax ID and automatically cut off the price.
5. Know Your Target Market
It’s good to determine how much the customer will be willing to pay in relation to how much labor time and craft supply costs are going to cost you. If your target market is centered more on families or lower income families, it might be important to lower your prices and your craft supply costs. If you are selling certain items at a certain time of year, it is also important to determine the discounts and sales that you are willing to offer, such as during Christmas time.
It is always important to remember not to undermine your costs because you want it to sell. Remember that you are putting the labor and supplies into the craft. You should always at least make a little more than your money back. It is also important to not over price your crafts because they are hand made or because there are not as many available. This will turn customers away. Despite what you know about the product and the value that is in it, customers are usually looking for a good deal.
By doing the proper calculations and by knowing what resources are available to you, it is easy to determine the amount that you should be selling your crafts for. By using the right math and knowing what to look for, you can find the right pricing for your crafts and let customers believe that they are finding a good deal for what they are getting.