Tuesday Tips - pricing your products

In this matter (and unfortunately like in many others), I'm a follower of those that came before me and thought about these matters earlier.

I have been selling on Etsy for a little over a year and when I started I admit I had very little knowledge of all the details that having a shop open entailed - even a small online shop like mine.

The items that I had sold previously to friends were priced mostly on the basis of the cost of materials - it's not like I was planning to profit a lot from them anyway. So when I opened my Etsy shop I needed to factor in profit as well.

At the time, I found this in an Etsy group I'm a member of, and while since then I came across other formulas, this one was the one that made the most sense to me when I was just a beginner:

Maybe it's not the most correct formula, but at least it's simple and easy to follow. 

Do I follow it all the time? Well...not always. Again, not because it's hard but mostly because sometimes it's not easy for me to determine the cost of all the factors involved.

Materials that I buy specifically to make something for the shop, those are inputed in an Excel sheet I created - including not only the purchase price but also how many pieces I estimate to make from them, to have an idea of the individual cost of each item.

But I end up using other materials too - leftovers from other projects, from things I made for the blog or to give as gifts, fabric and yarn scraps my mother passed down to me or even some vintage materials inherited from my grandmother. Those are much, much harder to price. I try, but I'm always not sure I'm doing it right.

And time? Well, that's hard too. I work full time out of the house and that's the only reference I have for the hourly cost of my work - which as you can guess has nothing to do with crafting. In addition, I rarely can afford to take one or two hours to make my shop items. I work on then mostly on the weekends and whenever I have a small gap in between house chores and whatever my kids need. So it's hard to keep track of exactly how long an item takes me to make. Still, I try as much as possible.

In addition to this pricing formula, whenever I launch a new type of product I also try to have a look at competition to see how I'm comparing to them. It doesn't mean I'm going to necessarily adjust my price either way, more often than not it's just to have an idea. But if the differences are substantial, I may need to give some thought as to what I may be doing wrong.

And that's it. As much as I try to keep this professional, I have the feeling I still have a long way to go  and a lot to learn. And, to be honest, this break I'm forced to take while I keep the shop on vacation is definitely not helping. But as long as we're safe and healthy, we'll all get through. 

Happy Tuesday and stay safe.

Don't forget to check the other Tuesday Tips posts from this fantastic group!

Kelsey's Crafts