Creating crafts is something we all enjoy doing and it can become a profitable activity.craft businessif you are willing to work. Using a craft calculator will help you operateProfitable business.
When you sell your crafts, one of the hardest things is deciding how much to charge for your products.
Pricing can seem both complicated and confusing.
To be honest, pricing and marketing your work can often get very stressful.
Knowing how much to charge for your crafts is a challenge for many artists and crafters just starting out in selling their wares.
Using a pricing formula is a good starting point for determining how much your craft should cost and can help you identify:
- All costs associated with making and selling your handmade items.
- You will see how much you have to charge to make a profit
- And whether or not you can sell your particular craft for a profit.
Why should I use a brew calculator?
One pricing formula will not give you all the answers. It's just one tool among many to plan your current pricing decisions. So, before we delve into the method, we will review some important details to keep in mind.
Use an artisanal pricing formula for your crafts...
- Take the guesswork out of listing a price
- It will keep emotions from clouding your judgment.
- Guarantee that you have included all your costs in your price
- Give your business room to grow and become more profitable
- Help identify opportunities to improve profitability and reduce waste
Disclaimer: This post may contain affiliate links. If you make a purchase by clicking on an affiliate link, Nevue Fine Art Marketing may earn an affiliate commission at no additional cost to you. Affiliate relationships include but are not limited to Bluehost, Tailwind, Skimlinks, SareASale, and StudioPress. To learn more, visitAffiliate Link Disclosure Policy
Craft calculator: how to evaluate handmade products
I can't think of anyone who would start a business to lose money, right?
Your product prices are the key factor and determine whether you sell products and make a profit when you make a sale. This is why so many artisans struggle to come up with a pricing strategy.
You will get a lot of viewers if your craft exhibition looks nice but your prices are too high.
You can get more sales if your prices are lower, but will you make a profit?
Many artists and craftspeople believe that if they charge less for their products, they will sell more.
Buyers interested in handmade products disagree. They expect to pay more because the product is hand made and not mass produced.
The price you set reflects the value of your work and contributes significantly to your success.
You can easily understand why so many artists find it difficult to create product prices.
How much is your item worth?
The first step in determining the value of your products is to remove your emotions from the equation.
Many artists and artisans value their products because they feel a special connection to their creations.
We should all strive for a connection to our artwork, but this shouldn't affect our pricing strategy.
When developing a pricing strategy, you should be aware of several factors.
Price your crafts by:
The market– Research what other artisans are selling similar products for. This gives you a good idea of what people are willing to spend.
utility costs–How much does it costdo each piece? If your craft is priced below the cost of making it, you will lose money every time you make a sale.
hourly wage–How much would you like to be paid per hour? How long does it take you to create each piece?
business goals–What are your business goals? How much do you want to earn per year?
Do you have a clear idea of what yourbusiness goalsWhat it costs to do business, how much you want to make, and how much people are willing to pay for the products you create will help you develop a pricing strategy that works for you.
Price formula for crafts
A pricing formula will help you:
- Consider all the costs of doing business
- Take emotions out of the equation
- You don't have to guess what the best price should be.
- Show them how to increase profitability and reduce wastage (waist).
A formula to help you evaluate your craft is:
% price increase + hourly wage + material costs + sales fees (place fees, PayPal fees) = sales price
Markup is the difference between the price of your craft and the cost involved in making the product.
To calculate the profit margin for your craft, you need to divide the profit by the cost of the products.
Subtract the cost of manufacturing the product from the selling price of the product to find the gross profit for each sale.
If you sell a product for $30 and it costs $20 to produce, your profit is $10.
$10 / $20 = 0,50
To convert this to a percentage: 0.50 x 100 = 50%
Here is an example of pricing your products:
% Price Increase (50%) + Hourly Rate ($20) + Material Cost ($10) + Selling Fees (3%) (Place Fees, PayPal Fees) = Selling Price
50 % + 20 + 10 = 45 $
45 x 3% = 1.35 (sales commissions)
45 + 1.35 = $46.35 (offer price)
This may seem like a lot of work, but it's well worth the time invested.
If you want to make money selling the products you create, you want to know exactly how much profit you make from each piece sold.
craft calculator
I've discovered some homemade calculators that make this process more manageable if you don't like math or don't have the time to calculate it yourself.
Etsy Price Calculatorvon Craftybase
This free crafting calculator was designed for Etsy sellers, but it works for you even if you don't sell on Etsy.
How to calculate wholesale prices
Wholesale is a special price you would charge if you were selling your products wholesale to retailers or to an individual buyer.
Your profit margin will be lower if you offer wholesale prices, but the benefit is that you sell more products that could help you achieve your business goals.
% Price Increase (25%) + Hourly Rate ($20) + Material Cost ($10) + Selling Fees (3%) (Place Fees, PayPal Fees) = Selling Price
Your business goals should determine the profit margin of your products.
Final thoughts on crafting prices and with a calculator
The pricing formula gives you an estimate ofwhat it takes to build a profitable business with room to grow.
The pricing formula tells you nothing about:
- The current market for your product
- How much money are people willing to spend on similar crafts in your location?
- The perceived value of your work.
If the amount you're asking to make a profit is significantly more than what you think you could sell your craft for, you need to take a serious look at the craft you're making.
If the asking price seems too high, there are a few things to think about:
- The material cost
- How long does it take you to complete a project?
What can you do to change these factors that increase the price without reducing the perceived value of your items?
A good example is finding a better price for your crafting materials or finding better ways to make the product faster.
Here are some tips to increase your profit margin.
- Shop online for the best prices for the consumables I use.
- I discovered different ways to make more products in less time. I tried many different strategies until I found the best solution.
- Offer lower-priced crafts at craft fairs to get people to visit my booth. In most cases, people would impulsively buy expensive items.
Related Post -Where to sell local crafts
The bottom line is that you may not be using the exact price stated in the pricing formula I went through.
The formula is designed to give you a profit margin that you can adjust while still making a profit.
There will be times when you can take advantage of the higher prices and there will be times when you want to lower the prices on your crafts.
The positive side of using the handyman calculator is that you always know exactly how much profit you will make on each product sold.
Related posts:
22 creative things to sell on Etsy
How to price your artwork for better sales
How to Value Art: The Ultimate Guide to Selling Art
How to increase the sale price of art
