A Simple Formula for Pricing Your Work

Thanks! This is really helpful, and I certainly need to use it!

Really great article, a new, small seller will find a lot to us in this! I have a small store, so these are great tips!

Pricing is so important and tricky! Thank you for the wonderful support and information!

use, not us..... sorry.

Use, no us. Sorry.

This is really helpful. I especially like the formula for adding in expenses like utilities, bus pass, etc. Thank you for sharing this valuable information.

even after working on my etsy shop for almost 5 years, i still struggle with valuing my work and figuring out how to accurately price my items! thank you again for the reminders - and the amazing formula!

Great tips! Thanks for sharing!

Great article. Thanks so much for simplifying the formula!

Very helpful article! Thank you!!

SO great! Thank you, Danielle!

it's helpful to use a freelance hourly wage calculator (many online) to find out what your ideal/best case/scraping by case hourly wage is. Many people pay themselves too little to be sustainable and this has the same negative effects on business as selling retail at your wholesale price.

Thanks for this article, Danielle! It's a bit awkward to have real retail prices, but I know it will benefit me later on.

Very useful, thanks. One point I will make after having watched the related online lab about the basics of pricing, is the difference between UK and US price listings. If I list something as £6, it will come up as something like $9.66, an odd looking amount. Now, I'd like to keep my £ as simple, even numbers but how much does this affect my US customers? Personally, as each of my items is by it's nature a one off (even my earrings are assymetrical!) I find it tricky to use the formula and still be comfortable with the (perceived) high price that results. But that could just be my second-hand unhelpful beliefs about money that are keeping my prices modest. ( I'm working on developing a 'Prosperity Consciousness thanks to Rhonda Byrne and Louise Hay! - but that's a whole other topic!!) Thankyou for all your valuable help :)

So helpful ! I am working on that right now. Thank you Danielle

thanks for this tip. But at times I find it hard to price it the "right" way, when others who make the same thing as I, sell less than half the price. I really don't know how they do it. Even if I don't take the international freight cost of shipping my supplies to me.. So at times, I do find it hard to decide. Do you lower it, but if I do, I can barely make a living. Any advise. By the way, is there a way to find out the ET time equivalent to CST time? I seem to have a hard time converting it! help anyone =)

Pricing has always been difficult, especially since I'm a new shop and still trying to figure out what my overhead actually is! Thanks for the great article!

Awesome article! I always keep my prices in order to move more items, it works!

I took notes from the online forum you did on pricing but it's good to actually have it written out. Thanks!

I shop alot and know what costume jewelry can go for, both high and low end. I try to price mine at a price I feel comfortable paying. Taking into account product costs and paying myself something.

Very helpful! I definitely will be putting this information to good use. This motivates me to keep better records of what I've been doing. Hopefully this article reaches more of us!

I like the equation! As of right now, I think my prices are right on target for what I want to sell, but I'll definitely keep this in mind when I expand the shop later this year with hand painted ornaments. Thanks Etsy :)

Very helpful, thanks! I definitely will be putting this information to good use. This motivates me to keep better records of what I've been doing. Hopefully this article reaches more of us!

I agree, this is a great formula. But like others have mentioned here and in other forums - it's tough to stand by this when so many makers are pricing their products so low in an attempt to compete. I don't know how they do it. Any tips on how to deal with that?

This is a good calculation. Well explained!

Brilliant way to calculate the value of your work. I'm looking forward to this!

Amazing advice! Thank you so much!

It just kills me when I see grossly under priced handmade items! I don't make a lot on my stuff, especially considering the time invested, but sometimes I still feel like I charge too much. There are lots of vendors in the fiber arts that just sell waaay too cheap and it under minds the rest of us, unfortunately. I don't know how they do it either!

This is AWESOME! Thank you, I have struggled with this for years and this formula makes a lot of sense. Thank you soooo much.

such a good formula! thanks for sharing & explaining. makes the process of selling a little easier to understand. thanks! ali

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Thanks for writing all of this down. I really enjoyed the last online lab on pricing and I'm looking forward to the next one. :oD

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Thank you,that is really helpful.

It's a good formula for the crafter ~ pricing right is the most important part of ANY business model.

Great post! Although some things I don't think you can ever totally recoup the time and effort.

This has been one of the biggest hurdles for me - I always, always underprice. Thank you so much for laying it out like this!

Excellent advice.Thank you soooo much

Wonderful info!

Excellent advice! I have struggled with pricing also. I want to be competitive, but also know the value of my work and properly express it. I'll be trying out this formula and adjusting prices accordingly this week.

very helpful, creative people tend to undervalue their time and work. Being buisness savvy isn't our strongest quality. thank you for this articles like this one are just a few reasons why i love the etsy community.

Good advice, and I am SO pleased that the point about underpricing work undermines other sellers was brought up; so true!! :~)

YeS, YeS, YeS....thank you for this information! Love it!

Very Helpful and informative!!! will defenitely keep this in mind for my shop!!! Thanks!

Great article ~ extremely helpful!

This is so clear and concise. I love these tips, I'm currently re-analyzing all of my business finances and this could not have come at a better time. I just started using Outright and it rocks!

Very helpful formula! This is something I'll keep handy. Thanks!

We wholeheartedly agree with several other posts on underpricing. When we sell our earrings to individuals who can actually see and handle our jewelry, we are always told how reasonable our prices are. Makes us wonder if maybe, we are underpricing! But we have only sold two items in our etsy shop so far so we still have to wonder if our prices are reasonable or etsy is such a large marketplace, maybe we have just not been found my potential customers.

Bookmarked! Thanks.

This is an OK article, but still missing a lot of information. Hopefully the online lab will fill in the blanks. I would like to see what we should put in for "profit." Are there any benchmarks we could use? Maybe this could be covered a little more in detail in the lab? Thank you, Kristina

Hi Kristina! This post is a basic guide to pricing using the above formula. Definitely tune in tomorrow night to hear what Megan and Tara have to say (and bring questions - we will have a Q & A at the end)! Another more advanced pricing post is coming up next week, as well. Tune back in to the Seller Handbook next week!

I think on Etsy it's really the opposite: people wonder why your work is so expensive, since I think the majority of sellers here underprice their work.

Thanks Danielle! I will definitely attend the online lab and I'm looking forward to reading your next pricing post!

Very helpful to keep as a reference. Bookmarked! ;)

A friend of mine once told me to list things high and if they sell great, if not, then I could always lower it. I never took the advice seriously until I was looking at my budget for the new year. I raised all the prices by nearly double on a lot. I have sold less, but made more profit, and that is success to me.

Hi i love the formula, BUT if I use it I come up with a price for something I selling for $45.00 now will turn to be $232 how to explain to customers the difference in price when is another Etsy stores are selling similar items sometimes for half of my price now, What to do when the market do not accept the formula prices? Del

Very helpful reference. Thanks for spelling it all out. Since I am also selling at a B&M Gallery and they take 30%, I am more aware of good record keeping and the margin of profit I want to consistently make.

Super helpful info... I need to get my shop back in gear! Can't wait for tomorrow's workshop video to be posted!!!!!

Great Article, Super Helpful. Thank you!

It's true, you can pay yourself more! I've been making bag for four years, and this pricing formula has just started making sense to me recently. I love what I do, and I want do it all the time, but other areas of my life were suffering because I was spending so much time sewing, and I still wasn't making the amount of money I wanted to. I started thinking about what it is that people like best about my work, and decided it was time to redesign my best selling bag with that in mind. I simplified the design so it takes less time to make, improved the quality of the work (more expensive materials that are less labor intensive to work with), and raised the price. I showed these bags at a craft show this past weekend, and they were a huge hit with my customers. I'm super excited about my future having time for both my creative and my personal lives.

Great to know this, especially came to how to value and set for wholesale price. Was a headache once I been involve in quoting customer for wholesale price.

Sorry I had missed the live session but am soooo happy the video is available. Thanks much. This really helps.

Great article, I think its tricky to get the balance between product and price!

Very helpful- just still hard to imagine selling certain things beyond wholesale price without shocking people with retail price

great article. me also small store. yup. pricing sometimes might be a little bit tricky.

Great Article - Awesome Equation! Simple & Helpful! Amy :-)

great tips.. I calculated and compare to what others are selling.. mine would have been overpriced. ultimately.. buyers are still looking at good deals :)

Outright is NOT free - only for a few months then they want $$

Such great advice! Thanks so much!

The way you can compete is by being more efficient at what you do. Find ways to cut down steps. Materials and Expenses are pretty consistent once a design is rolled out, but the time is takes you to make it can always be improved. Time is the most valuable asset we have but many don't account for it. Time is money.

sorry - did not have this right - it is $9.95 a month for Outright plus. You can have the basic for free

Pricing is frustrating for me--there are practically no materials I can purchase at wholesale costs because it means storing a huge amount of items that would take me a long time to use. According to your formula, my prices should be at least double what they are-I definitely don't want to undercut anyone, but at the same time, want my wreaths to be affordable...so I am constantly rethinking them. I welcome any suggestions!

Excellent article.

I can't get this formula to work for me. My products are very labor intensive, and most items like mine sell in the $30+ range, so that's how I price mine. I even get complaints at art and craft shows about how high my prices are. But using your formula, these items would wholesale for $60 and retail for $120. I've worked hard this past year on making wholesale contacts for my materials, and redesigning many items to get more bang for the bucks (and labor) I put into them. But it's still not enough to work with this formula.

I see this mathematical mistake all the time. Your equations should be this: Materials + Labor + Expenses + Profit = Wholesale Wholesale x 2 = Retail

It's also difficult to charge the real retail price of certain items for the simple fact that a lot of people aren't willing to pay :/ especially in this lousy economy... as an artist, I just dream of having a few rich people who love my work and just buy from me all the time lol :p

Thanks for the article.

It's hard for me to know how to price my sweaters; if I can't sell them at craft shows how can I expect them to sell at a higher rate (to account for Etsy fees)?

Appropriate pricing is fundamental. Those who don´t price their work right are dumping prices, creating false expectations on customers, making it harder for others who need to live from their handmade work and plain and simple giving away their work and just slowly or swiftly driving towards failure. It´s important to find a way to rationalize production, refine offer and give work an added value. Cheap should not be a goal. Value your work and others will follow.

Thank you for this! Pricing has been one of the more difficult things for me. I've had several people tell me that my prices are much too low but I was nervous to price them higher starting out. Thank you for sharing this formula!

Thanks for the formula and tips :)

Thank you! Pricing always be a hard one for me to solve :)

Question: in the example of all expenses added together, are these costs for a 1 month period only, eg is the bus pass for 1 month only? thanks

It's so daunting to buckle down and figure out every monthly expense and THEN to determine what we want our profit to be!! ...but these suggestions are good...and certainly will benefit all etsy sellers!

Thank you for the great tips.

It gets even harder when local stores start selling your items out of respect, the price should be somewhere close or preferably identical to their price. There is nothing more annoying than buying X brand for X amount (told to sell at 2X) and having the company you bought it for sell it for just a few $ more than your "wholesale" price (ie these companies simply use you as an easy advertising tool). I was told by one of my store owners that there was no way she was selling my poncho for the same price or slightly more than a "baby undershirt" on her shelf. It takes tremendous amounts of time/effort/research to create, you need to pay yourself and don't let "watch dog" store owners try to buy your items for pennies. They can buy inferior products and do that.

A very helpful article. Helps understand the economics.

Great tips! Thanks for sharing.

I truly appreciate having this information, but it also discourages me to feel that what i'm doing is pointless because if i really priced according to this model, people would look at it my prices and think theyre ridiculous, on the other hand i've never tried it so maybe i should...i hand paint cards which is very labor intensive, some designs take longer than others, but they truly are meant to be given as a gift and framed as works of art, and ive already streamlined the process as much as i can. I'm still trying to find my footing with constant sales, so maybe i should just raise my prices to high heaven and see what happens, who knows it might work...lol like one other seller said, selling less but at a higher price can be more profitable in the end, but if anyone cares to respond to this question to help me, should i then remove all my cards from the "card" catagory and place them under art...oh vey! The process never ends, but i guess thats a good thing :-)

Sorry to be long winded, one more question, why is not labor and profit the same if only one person runs the shop? Just curious...

This is very helpful! Thank you! And the comments are helpful too! I am not alone! I am not the only one that finds it hard to pay themselves for their work!

Great tips! Thank you!

now if only the people would buy from me!

I'm so glad that I read this article. I'm new to Etsy, just 2 months in to my flower clip shop. I plan on working through the formula to figure out what I should price my items. At this point in the game, I have just been focused on getting sales. I figured I would start my prices low, than after I got some good feedback I would work up to the price that would give me some profit. But then I wasn't making anything and was spending a lot of time for no profit. So I inched up my price to at least break even. After I plug the numbers I'll be able to see if it's right. Thanks for the ideas.

Very helpful advice. It's nice to dream about someone wanting to buy 100 of my headbands! These are tips I'll definitely keep in mind.

These tips are great! Thanks.

Thank you so much for this great article. Pricing is definitely a hard part in this Etsy journey! It seems like part of the problem with pricing sometimes is we don't know who our target market is. When I have shown my zipper bags to people who I consider my target market, they always think the pricing is fair. My time is valuable, and I cannot afford just to give it away. Remembering that helps me to price my bags fairly, for me, for my family, and for my customers.

Great advice and insights. Also good to see others discuss their struggles with in-category low prices. I definitely shop around for great raw material pricing and I am still a little befuddled over some low prices for seemingly similar items.

That's the same formula that's in a book I've had for years and years. Makes complete sense, but often hard to put into practice and still sell. I've struggled with pricing for years. I'm working on getting into a little bit higher market (hopefully). Sales for me have been quite slow in my transition, as I'm working on moving my online stores to Etsy to accommodate this change of finding a higher market that is willing to pay a fair price for handmade, and selling at proper prices here locally is not very feasible. Thanks for sharing the info, and encouraging us not to underprice our handmade wares. Somehow, we all have to find our balance of finding a price that sells AND makes us a decent amount of $ for our time and effort. :) I need to do a better job of keeping track of my time, so I can try to apply the formula again and see what I come up with. :)

This is a great advice!

thanks for the infos!

Thank you so much! My bouquets are my artistic inspirations & I make each one with quality & high end items just as I wanted for my own wedding! I use vintage signed brooches which are not inexpensive & I dont like the overwhelming look of Brooch Bouquets. I have made them for some time now but, only recently I need the income. I have been hesitant to post... Thank You so much for the boost!

Great tips! Thanks for sharing!

Thank you, pricicing is always complicated, and something that I'm still trying to perfect. I've been working to a similar formula (but sometimes in a "weak moment" I've doubted myself) Good, to know that I'm on the right lines!

great advice! thank you!

I fully agree about the talent that should not be underestimated. Really, even some most simple items being sold here are sometimes just stunning because they've been made with great TALENT. I believe this is the first and foremost thing to be takent into account when figuring out the price ;)

Thanks for the great tips!

Love the formula - fabulous advice.

Good advice - thanks!

Thank you very much. It is difficult to price and this is a great help fomula.

I don't make the items I sell. I sell vintage things I've owned or purchased. How do I price those correctly? I've listed some items at what I believe and reasonable but have gotten no sales. I now realize the first items I sold were underpriced which accounted for how quickly they sold. I wish there was some pricing advice on vintage goods!

Oh, and one more thing: the sheer amount of time it takes to photograph, measure, describe and post items for sale is time consuming. Do I factor that in as well?

Thanks very much, working on this now so it's aptly timed, and very useful! :)

I think a big problem is underpricing as this makes anyone that prices their shop fairly, feel they are themselves overpricing and then they need to reduce their prices. You end up going round in circles.

i've just started to draft list some stuff on my shop for the first time and drew a blank when pricing them so this article couldn't have come at a better time, thank you!

I've always had trouble with pricing, sometimes pricing a bit too low even though i beg other artists not to sell themselves short... thank you very much for these insights.

I sell handmade wire wrapped sea shell and sea glass necklaces and earrings. What tags would you recommend.

Pricing is always such a tricky subject, since it can vary so much when it comes to art. I think this will be a good place to start though and adjust or leave the prices in my shop accordingly. Thank you for the tips! :)

I also agree that talent and time should not be underestimated, but in today's world it's also important to do a reality check. Even with careful shopping and cost controls, it's pretty tough to compete with the commercial "big guys"; at least if you're not selling jewelry. My products are labor intensive and high quality. Even using lots of comparison shopping and tight cost controls, I couldn't possibly price with the "jewelry formula" and expect to ever sell something. Common sense is essential in this decision -- I'd much rather sell 6 items at a little less profit, than none at the "right" price. Bottom line --- today's consumer is VERY cost conscious, and doesn't always or necessarily recognize the time, talent, and effort taken to construct a high quality product for them. Now if I were able to buy a ten thousand yards at a time . . . . . . . .

What also needs to be addressed is whether you are going to be a hobbyist who enjoys creating and has been told by friends and family that you should be selling some of your stuff OR whether you want to support yourself by doing this. I fall into the hobbyist category and I am not getting any sales at all on Etsy, but a decent amount of views and hearts. The only sales I make is to my co-workers at my day job and that market is limited before oversaturation occurs. I have taken into account the cost of my materials, my time (labor) and a little bit extra that could be considered profit. That comes out to a wholesale price that I think is fair. Sell for retail?!?! Really?!? OK, I will do that for my highest priced piece of jewelry here on Etsy and see what happens - I certainly have nothing to lose. I do agree with a great many of the previous posts regarding underpricing - I can't figure out how someone will create a beaded Kumihimo necklace using what appears to be quality materials and sells it for less than the cost of materials alone. Makes me look (at my wholesale price) like a greedy charlatan. Of course the formula has its uses in educating the seller/artist (if no one else) as to the worth of their effort. Sorry for the rant. Really frustrated.

I missed the lab. Is the video available?

Thanks for this article. I have been using this formula for a while, after hearing Megan speak about it previously. However it is lovely to see it broken down. I wish more people would price correctly, use this formula, and truly value the time and effort they put into a piece. Handmade items are something special, and one of a kind, and that should be reflected in your pricing I think. Plus, pricing correctly allows you to do things such as sell at wholesale, or offer discounts at certain times of the year and still make a profit. Thanks again!

It is all relevant to product & competition. What slays me, I might make an item almost identical to another crafter, mine is 1/2 of their price, but theirs sells & mine stagnates. I think some buyers think they need to pay the biggest price to acquire quality. Not always so. Makes me think of a few short years ago when scrapbook pages were selling like hotcakes on Ebay. A couple of sellers managed mega sales (over $500 a page) while others couldn't give away really cute stuff @ $25. a page. In theory, yes you should be adding all of these things into your price. In reality, how many do?

I try to check out other companies off of Etsy to see what they are selling for. I am usually right on target, most of the time, because handmade is a different category than mass produced. Nearly everyone recognizes the out of country mass produced items and their cost. We just cannot price that way. I price my items just as if I was working an Art show. That travel, even to the post office, eats up a lot of gasoline. What would you have an employer pay you to do the same product every day? You have to consider how much time you are really spending on a product. Time it sometime, it might surprise you.

Great information. I agree with Mary's comment above too.

Thanks, this is great info.....I really need to relook at my prices.

I make bags and also beaded/crazy quilted satin cosmetic sized bags for brides and bridesmaids. My daughter is a dancer so her dancer friends order my large bags for around $150. My beaded bags I have sold for $100-$125. I would never get that in a shop because the price on it would have to be so high for them to make a profit much less me. I also have a formula I used when I made handmade mohair bears. They sold for between $350-$550. depending on the size and the cost of the mohair used. It was by word of mouth and internet, via the bear supply shops but it's a small circle of people who collect them (and this was 10 plus years ago). I did a couple of bear shows but if you aren't well known, you might as well forget it. It's like being well known makes a better bear or bag?? I was asked to put them in a shop but they wanted to ask so much they'd never sell. I could do better selling my few bears a year myself. I haven't put anything on Etsy because I find the market is just so saturated with bags. You really have to have something extraordinary to do well. I find the gals who sell fabrics get more sales than we with finished products. If you put your price too low people say "what's wrong with it?" and if you price too high its "I can't afford that/I could make that for cheaper/I could buy a bag similar at Wal Mart". It's sad when craftspeople are trying to make a living or pocket money and people don't realize that if they buy from us, they get a mostly one of a kind item made by a lady who has a sewing room in her home with a dog at her feet. To me that's a lot better than a Wal Mart bag anyday.

This is really useful thank you - think I need to look again at my pricing!!

will think about it in the future

I took your advice. Upped the prices of my items ever so slowly. Did the first price change before I went to bed, woke up to a purchase on one of the items I changed. Wow, you were so right. The price doesn't matter if the customer loves the product :-) thank you!

Awesome video. Don't be afraid to price your items people. All throughout history, artists and artisans have been very sought after for their talents but NEVER compensated what they are worth...Michaelangelo, Van Gogh and Kontoglou to name just 3 out of the millions who did not fare well in the pocketbook while alive, yet, whose art transcends the priceless.

I sell mostly bakery items such as cookies. fudge, whoopie pies, an assortment of cupcakes and much more. I don't ever see any help on how to price them or workshops. It always seems to be help on selling jewelry or knitted or sewn items. I did see a formula on the cooking channel on how to price restaurant food. It was the cost of the meal X's 3. That is what I try to do.

Many of our Etsy sellers who sign up for Outright are really surprised to see their expenses. It's great that more sellers are starting to look at that factor as a part of their pricing. We also see a lot of sellers who are happily surprised when they see that they really are making some good money off of their sales. It's so cool that they can do something they love AND make money. - Laura from Outright

What about knitted items? They take so long to make. If I wanted to make 7 dollars and hour, my Barbie clothes would have to be $20. So what do I do?

Thank you for helpful I'll used it **

Wow, this is a great article and video! Thank you so much for sharing these helpful tips :)

Excellent information. The aspect of pricing at a point that's fair and supportive of the selling community is one I hadn't really thought of. Yet, that might well be near the top of the list in terms of importance. A cost that is often overlooked is professional tax preparation. That can be pricey and should be taken into consideration, too.

Excellent information. Selling card/papercraft items such as cards, I really cannot justify charging too much. None the less, the online lab was really useful, and it's good to see the formula here. I did try to take notes, but it was somewhere in the region of 1am here in the UK. Brain was a bit addled by then! Excellent work and really appreciated.

Such a helpful article! Fingers crossed things will work out for us all! x

Love this..but quick question.....the whole "profits" segment...I'm not sure I understand completely.....can someone break it down a little more for me? Let's say I do want to be able to quit my day job....how do I factor that in? I decide how much I should be making a month then go from there? Help! :)

Pricing is always a struggle for me.... I wish there was one "magic" formula....

I've always used materials x 3 formula...although I've always had to drop to materials x 2 for things to sell. I'm trying again to build my own shop, with new pricing etc...thanks for the article and great video!

In addition to my wonderful Etsy shops that I adore, I also have a brick and mortar store in the outer suburbs of NYC. I have been selling my own handpainted silks as well as jewelry and work from other artisans. That being said, I mainly sell mass produced items including accessories and giftware. I have a very eclectic mix in my B&M store while I use Etsy for my extensive collection of vintage jewelry and my more expensive silk scarves. It's working out very well for me, in fact, if the economy gets much worse, I may eventually close the B&M shop and be exclusively online. As far as pricing, I hate to burst anyone's bubble but the truth is that you can only get what someone is willing to pay. You can do all the figuring out you want for your time and materials, etc. but when it comes to the handmade items, you may not always be able to get your price. In which case you have to make some decisions. For example, I found that I've accumulated quite an inventory of silk scarves, not all of which have to be priced that high for me to make a small profit. I know I'm selling them cheaper than I'd like, but at least I'm not losing money, which is a very big consideration for me. Also, some of the scarves may be a few years old- how much longer do I want to hold on to them? I personally am glad to sell them and use the money to buy more inventory to create new products. As far as the vintage jewelry, I find that to be really tricky when it comes to pricing. There's a lot of it out there and for now I'm limiting myself to only a few different categories. Sometimes I see pieces out there that are for sale for way higher than what I'm selling them for. Other times I see items that are priced much lower than mine. All I can do is to try to price the pieces so that I can make a reasonable profit and continue to do research so I don't mistakenly sell something too cheap. Thanks for all the great tips from Etsy. I love selling my stuff here and the people are all so wonderful!

This info was truly helpful, and I must honor the knowledge you guys or gals:) have shared with us newer artisan entrepreneurs like myself. I have been on Etsy for months and haven't sold a thing yet!...-(very much in part due to my lack of willingness to be online). I have often wanted to undersea my handmade creations just to keep up with the competition out there! Your words of thoughtful wisdom really make sense!! Thank you for sharing! I've got notebook in hand to jot down calculations and more coat-effective concepts!! Thanks :D

I had opened an Etsy shop a few years ago, but then did not proceed because of pricing concerns...I crochet everything....hats, rugs, afghans, dolls, flowers, food, etc, etc...but, if i were to calculate in my labor with the materials, shipping and supplies, in today's economy, I don't think anyone would purchase:( For example, if an afghan cost me $100 in yarn and if it takes me 7 days to complete, are there people who will pay me for that? I had been told to multiply the cost of materials by 3 to get the selling price....so $300 for the afghan....????

Rhonda had asked a question about the overseas money in relation to US dollars. As a US customer that often buys at overseas rates, as I see that our dollars are worth less every day than the overseas money I just get mad at our government not the seller. Don't worry about it.

The greatest frustration about etsy is that while one can search to see what comparable items are selling for, one cannot search to see what comparable items have sold for. What someone hopes to get for an item is far different from the actual prices that items do sell for. Etsy claims that is a 'privacy' issue, which makes no sense since posted sale prices are available. This frustration leads me (and many others I am sure) to search 'completed' sales on ebay and other sites. The conundrum here is that a seller would very possibly chose to list an item outside etsy, thereby weakening etsy's worth as a selling tool. To mitigate this, etsy need only make it possible for a seller to see the final sale prices in a 'completed' items search.

Thank you so much!! I appreciate the workbook, and the video was really helpfull, esp. adding the Q&A's. Well done!! A lot of food for thought and a place for folks to start! I agree very much about not undervaluing and intentionally or possibly inadvertantly undermining other artists in your 'genre'...it happens everywhere in the art and performance fields, sigh. It really pays to turn on the 'business' side of your brain, even if most of what you do is a 'labor of love'....as so many of us started out....I think thats the biggest hurdle for many artists-the business side of it, so again, thanks for your input!!

Thanks for the hints. I just signed up yesterday and never sold a thing in my life. I am not trying to make a living at this but thought it would be fun. I will keep track of my costs to see if I am doing ok. I did some of the things you talked about but it was good to see what you had to say so incase I missed anything and don't want to forget anything. You guys were so cute , relaxed and fun to listen to. Thanks for your help.

What about when you have a lot of hours invested in one item. Like hand knitting for instance. It might take me one hour to make a coaster, but you would typically sell them in sets, like 4, so if I paid myself $10 an hour x2 = $20 each x 4 coasters $80 for a set of four coasters? That doesn't even include any other parts of the formula. :( My shop is up, but I haven't listed anything yet because the pricing and the amount of time is really hard to figure out right now..... What do people typically charge for an hourly rate and then how do you figure in profit?

Thank you for the helpful tips. I have had my shop for 2 years and still have a hard time deciding what to price my work. I will use this formula to help me out. Thank you:)

Thank you for those reminders!

Very helpful, there are points i was totally missing.. :o Thanks a Million! :)

Thank you guys so much for this article, just today i was thinking if my prices are not very good :)

Very helpful article!

Incredible resource!!! Thanks so much for sharing!!!

Excellent information ! thank you !

Awesome! I shall adjust to this:)

Learned so much from the online lab! Thanks for this positive reinforcement! :)

Really great service & advice, Etsy folks. Thanks so much!

I agree that it is important to take into account all of your "cost of goods" (COGS) as well as all the "hidden" costs AND to be sure that you are realistic about time, wages, and profits, but these do need to be in line with the consideration of "what the market will bear." Prices do need to be within a range of what buyers are willing to pay---providing that you as a seller are not going broke. In addition, there are also some substantial variables in skill which will significantly influence pricing. For example, I have been spinning for over four decades. Likely, as a production spinner, it takes me less time than someone who is just starting out. There is a very wide spectrum of experience on Etsy. Additionally, if some sellers are buying their materials at wholesale while others can't afford to (or don't use as much of a commodity) and are buying their materials at retail, then this can add additional disparaty to pricing as well.

I hate to say it, but it seems that this pricing strategy is impractical in today's economy. People can and do shop on price. Some people value handmade, original products and are willing to pay more than they would for a mass-produced product, but many will only pay so much more. It might be nice to say don't under-value your time, don't shortchange your self but for many, raising prices probably means less sales, less revenues and less profits. Yes, streamline processes, buy smarter, etc to lower your costs. That makes sense. But to take cost of material, labor, expenses, profit and then DOUBLE it? Most of us would go right out of business. In the business world there are many pricing models used successfully . Different models are necessary for different markets and different products. But doubling costs (let alone adding in desired profits and then doubling) sets the stage for dissappointment. It's not a sellers market. If the price is too high, people simply walk away.

This strategy is a little too basic and does not take into account for market demand and competition. You have good points regarding capturing all of your costs but just stating to add labor and profit and double will not work especially for an online market where the customer can not feel or experience the item first hand. If I was selling retail in a boutique the qualities of my craftsmanship would stand out. People do competitive shopping on line very easily. So market research and competiive pricing has to be key.

Thank you. Thought, I agree with Ray Hardford.

What I am finding with pricing, on my items, is that people in Eastern Europe selling crochet items are selling a piece that I need to price at $32 for $6! How do I compete with that? And the vintage folks find a doily someone spent dozens of hours making, and they sell it for $5. I would really appreciate if anyone has insights on that. Maybe the answer is that I should not be trying to sell the beautiful things that I make, the gift that I have to create them?

Thanks for the video. I thought my pricing OK because I sell quite well here in local bazaars. But when come to Etsy, I've little sales. I know there'll be a lot of reasons but thanks for letting me know one by one :) Calculating cost is tricky. There are so many small cost e.g. cost & time incurred when procuring materials, the exchange rate when ordering overseas material, inflation, shipping charge varies when you order more/ less material each time......and a lot more

Great article and great tips! I think a lot of people under-price their work, because they're afraid that nobody will want what they have to offer if it's too "expensive". But, if you think about it, the price of your items is just as much a part of the design as is something like packaging or photography!

thanks so helpful i still struggle with my prices but am defiantly working on it ! :)

I think this model might work well for high end items, items such as art, fashion or very unqiue items - provided the economy is good and the competition is low. In handmade these days, the access to knowledge, tools and resources is readily available to everyone - and this includes access to creating shops like Etsy. The handmade market is a highly competitive one and you have to be realistic and price accordingly. Before I opened my shop, I spent an incredible amount of time and effort recording information to calculate an accurate and fair price (I left out all the time I took taking photos and writing product descriptions - for my price point, that would have increased the price too much, but there I was, spending all that time!). I then loaded the products into my shop and vetted those posts through friends and family, asking them if they thought the prices were reasonable. Their feedback indicated that prices were too high. I agreed, and further confirmed this by searching for similar items online. Everyone was undercharging for their work - it was quite clear. You can't always compete in the virtual handmade market in this manner - clients are not touching your work, they don't always consider the quality of items the way we would, they don't really care about the endless hours you pour over designs. They want to look around and get the best price - and by creating an online shop, we make it extremely easy for customers to do just that. So, in the end, after all my work tracking every single cost on every product, I scrapped my pricing strategy and started charging market value, when reasonable. I decided to focus less on profit and more on just brining in funds to keep my hobby going. And for most handmade items being sold online, this to me, seems like the only option. Handmade goods are just one of those items, that by their very virture of being handmade, don't make a lot of profit, and I suspect most shops stay open more out of passion for the craft than the money. Businesses function to make profit, and that is very hard to achieve in the handmade market these days. You have to decide for yourself, in the end, if all the effort of keeping your hobby-business going is worth it - and you have to be honest with yourself about what it is you are doing. I suspect for most, what they have is a hobby masquerading as business. That's just my two cents.

Great article - hope more etsy sellers will take it to heart and raise their prices, otherwise I am afraid that I have to agree with CreativeLment. If I follow the pricing formula for my pendant necklaces, I will have to raise my prices by 5 to 10 per piece, and my prices are already on the high end of my category. I think many sellers are making just enough to cover their expenses and/or they live in areas where the cost of living is really low. Materials and postage is super expensive in Canada, which makes it difficult to compete with sellers who list items at these insanely low prices!

And, as a buyer, may I suggest to not calculate the cost for packing material too low. It's fine to get something at a good price, but packing well is absolutely mandatory. For example: I have received too small works on paper lately and both of them were well packed ... just not well enough. In both instances, the whole cardboard envelope had been bent during shipping, slightly creasing the work. It's a mistake even experienced shops make. Once a fairly expensive art edition print I ordered from a well established gallery was damaged this way. And there a few simple tricks that don't cost too much to protect paperwork just that tiny bit better ...

I like the idea of using a freelance hourly wage calculator, but this won't work for needle felters. How do we determine what is the proper hourly rate for our work. I am currently paying myself $5 an hour and only charging the wholesale price even though I feel like I am worth more than just $5 hour. My items can take anywhere from 4 to 10 hours to finish. I have not had a sale before and I don't feel like someone would buy my item for $80 so I price them around $30 to $45. Most other needle felters either under charge their work even lower than mine or charge the full price. I think that under pricing affects other shops especially ones that put more detail in their work like mine. I do plan on adding items that people would be interested in other than mushrooms. I also plan on making wedding cake toppers which would bring in people would could afford my items for their wedding. Any suggestions would help. Send me a private message as well if you have any good advise. Thanks, ~noa

Great article, so many artists struggle with this concept...myself included!! We tend to undervalue our work or do not take into consideration all the aspects that go into making a great item for sale. It is a business formula not a decision based on emotion. Artists who under value thier work attribute to the larger problem with the arts industry, artists getting low balled and expected to work for nil. But that is another issue entirely!!

Really helpful article.... everybody should follow your advise ... I am based in new york city.. making everything I sell, myself and was wondering if Etsy was for people like me... I just saw a listing of a set of 3 hand crocheted 100 % cotton washcloths offered for $ 11.25..... Now tell me what kind of profit this person is making ? i can crochet and knit so I know the time it takes and the price of yarn.... This makes it impossible for people who treat what they do as a business to be able to sell their work.. Most of the sellers on etsy are there as a hobby...

I'd like to add that Etsy present themselves as a place to sell HANDMADE products... They should not accept "assembled" items.... tons of products on Etsy are just commercial elements (bought in bulk) attached to a chain or an earring wire... I don't call that handmade and I am sure that a lot of people agree with me....

The advice is very detailed. Thank-you. I am one to follow step-by-step instructions and lots of advice in the article fits the bill!

I sell vintage items depending on my cost I consider what it's approximately valued at by using Worthpoint a subscription,eBay seller account sub, and Sellersourcebook Before selling anything I've already invested $25-$30. Resource books,cost.references at Library cost time. I agree with Edythe Preet. Asking price and actual sale price are fundamentally different .I'd like to know what items are actually being sold for.

excellent information, I only wish the volume was higher. I had trouble hearing it. But enjoyed and will use the info! thanks

Great information! Thank you;-)

Thanks. I'm a little surprised at how high I probably should be setting my prices, but it's food for thought and will make me look at how I do things.

this is what I am looking for! Thank you so much! I'm learning!

I agree with Carol P Dominique in wanting know what items are actually being sold for. Revealing my final selling price would not bother me at all as it would benefit everybody, besides I assumed sellers get their actual price. Does this mean there is a lot of haggling going on? That surprises me!

I also concur with Edythe Preet. I wonder how many Etsians would not mind showing their final sales price ........ has anybody asked? Why not offer Sellers that option.

So glad I found this article. Thanks so much for sharing.

Thank you so much for this article! It is giving me the confidence to bump up my prices where they belong. :)

Very interesting. However I think it is more a guide than a rule, because we also know that price is a function of offer and demand in a free economy. So the more there are people making the same stuff, the harder it will be to apply this equation. The more there are people looking for the same stuff, the higher the "profit" number you can put in the equation. Also we are not in a closed market. somewhere we are competing against the Walmarts, the Targets, the Kohls you name it. Their prices also indirectly affect us. In other words, our work should have something special unique found nowhere and that people want!...price will follow.

Loved the video! I am going to add up my some numbers now... Thank you so much :) :)

Thank you so much for this, I've figured for awhile now that my prices were two low but had no idea how to go about fixing them. I'm a little nervous about seeing what came out of the formula but I'm going to look at some comps and see how I compare.

Challenge accepted! Thanks for giving me the kick I needed >.

Some types of handmade items don't lend themselves to wholesale. OOAK items that are very labor-intensive can't be made in enough bulk for wholesale, and doubling the cost to form retail would make these types of items priced too high for the market, in general. Things like art dolls and quilts come to mind. So depending on your business model and the types of items you sell the formula might need to be modified. And some items just have a "ceiling" for price no matter how much time they take to make. People are only willing to pay so much for a greeting card for instance, no matter how intricate and well-made it is.

I think Danielle was wrong when she said to charge full time if you craft while watching TV. Once with no TV I learned I could make an item in half the time it took me when I made it while watching TV. You can't help but stop and watch when a show gets interesting, and that's not crafting time. If you're going to use this formula, it's got to be actual time used.

This was very, very helpful.. I especially liked: "Selling your work at a wholesale rate undervalues those who price their work at the proper retail price." and I think it's something that people need to pay attention to. Recently, I advertised my goods on another site, and got the comment "Pricey, IMO". So I started thinking about this exact same thing, and doing some research. Given the quality of materials I use, and the fact that each item is made to order, custom, and that it's timely, I decided that my items are priced fairly. And in doing my research, I found many people (or wholesalers POSING as people, possibly) that are selling similar items at a lower price, giving the person that made the comment to me the unfair impression that my goods are over priced. I can see clearly how undervaluing your own work and selling at a very low rate affects not only yourself and your profits, but other artists who are correctly pricing their products. Thank you for such a helpful article :)

This is great advice!!! I will be sure to adjust my prices where necessary. Its really helpful to keep track of everything. I need to get myself a little notebook. Thanks!

Very good advice, thank you so much! :) I wish I could follow them, but as it takes such a long time to knit just a simple (one color, no pattern) hat, almost all my hats would have to cost well over 120$ to ever really pay off. The material I use is very good quality. I just feel that if I put higher price on the hats nobody will buy them. I prefer selling some hats as I enjoy making them than not selling any hats at all. Good luck to all of you, it's not easy to find the right price.

I love this advice, but only if people would buy that would be nice

Good advice but at a certain point things become too expensive for people to want to buy :P

Great info Thank you!!!!

Great tips...I have so much more to do.

Thanks for the tips. I'll keep in mind.

Thank you this has been most helpful :)

interesting math. i put 12 cent a hour for my time and the selling price came out more than a new car. hummm.

I always need to reevaluate my pricing and this is a great article to go over for reminders! Thanks very much :)

Thank you so much for all this wonderful information. Definetly will be put to good use

thank you very much for your support and your great tips!

Great video and really helpful pricing formula. I am about to open my shop on Etsy and this advice on pricing will be extremely useful. Thankyou.

This is so true about re-evaluating your costs. My first range of evening wear cost me 2 grand in materials, god knows how many hours to develop, and then all the running costs on top. What happened? Well in order to pay myself a 'fair wage' the garment costs are on the high side. Some of the designs, the materials form half of the retail price! So, I've got back to the drawing board for the new season and worked really hard on sourcing better value materials so I can make garments at a better retail price while not shorting myself the wage I deserve.

Thank you for this video. I learned a lot about pricing my own artwork. The pricing of supplies or vintage items is a bit tricky though. The one part that still gets me is the shipping costs. Trying to figure out the best cost for each country (other than my own) and their taxes, is unbearably confusing...every time. I usually just get estimated quotes from the post office and letting the customer choose their preference before sending. But something tells me i'm not charging the right amount entirely.

Amazing advice! Thank you so much!

One point that I would like to add is that if you run your items through this formula and they come out unreasonably high (I know you shouldn't base prices on what you would pay, but there is a limit), perhaps that is the time that you should be looking at your design or processes to see if you can reduce the price by simplifying something, rather than paying yourself less or continuing to produce items that are unreasonably expensive that nobody will buy.

Thanks for the good advice! Really has gets the brain working!

I use a similar formula for most of my items. However, I get upset when I see others selling items at less than I pay for materials. Maybe if we all used this formula, prices would not be so different from shop to shop. Thanks for the advice.

I am just starting my Greeting card site on Etsy. I wanted to see how to determine the shipping cost and the additional cost for any additional items. Any tips would be helpful. Thanks, Therese Britt

Great article, thanks!!

Thanks for this great information. I struggle with this area and it was great read on what to include in the formula for setting your prices. Thanks!

This is awesome... thanks!

Very helpful!Thanks for sharing! :)

Thanks so much for all the advice & info, greatly appreciated. :)

Excellent advice.Thank you.

Thank you for breaking this all down! It really helps!:)

Thank you for for this excellent Blog and excellent tools!!!! There is so much great info, much appreciated!

Thank you so much, an excelent Job !!!!!!!!!!

this is VERY helpful! thank u so much for sharing :) xx

hi guys, this is a great tutorial! THANKS! just to weigh in, the $0.99 only works if your selling price is $50 and you want to "trick' people into thinking its cheaper by putting it at 49.99 -- which makes it look like its $40 bucks instead of $50. however, as michelle and danielle indicated - the difference is probably minute for buyers and works only for lower end items.

Is there a tax chart out there for cost of good ie.... if customer spend between .01 and.25 the tax rate is: ?

VERY helpful! Thank you! This is a much better starting point than trying to copy other people's pricing without knowing how similar their product is! :)

This is SO HELPFUL ! Thank you so much. Lucky us to be part of such a lovely community :)

very well written.Thank you

WONDERFUL, IM AN HANDMADER BUT SOMETIMES IN ETSY THERE ARE SHOPS HAT OUT A LOWERED PRICES FOR ONLY SALE. I CREATE EXCLUSIVE HANDMADE, EVERT PIECE FROM MY REAL BOUTIQUE IS EXCLUSIVE AND I DONT REPEAT THE ITEM SOLD...BUT SOMETIMES I HAVE DIFFICUL WITH BUYER ON ETSY THAT DONT UNDESTAND THE HANDMADER WORK...SOMETIMES, BUYER MAKE LOWEREST PRICE PURCHASE...I THINK THAT BUYER THAT WANNA BUY ON ETSY MUST KNOW THAT THIS AREA ITS FOR HIGHT QUALITY HANDMADER AND VINTAGE...

This doesn't feel helpful to me. It makes feel lots of things, but helped and encouraged are not among them. According to this, my cotton skirts should be $158. I feel like I'm already pushing the market tolerance with $62. Well... I feel pretty hopeless now. Bulk fabric is out of the question, and I can't make them any faster. I'll make some goals and consider this. It is interesting stuff.

Thanks for the great article. I am amazed at the low prices that I see listed on so many items that fall into the same catigory as mine. I honestly don't know if people are doing it just for the fun of it and don't need to make a profit on it or what. But I know I can't even buy my materials for the prices that I see some items listed for. My shop is new and I am hoping that there is a market out there for what I love to do and a price range that will make it affordable for me to continue to create my designs. Definitely encouraging.

This was very helpful and made my really think about my pricing. I'm def. under-paying myself for labor, but I think that's one of the toughest things for most artists in general. For one to even think about our personal creations from an hourly perspective seems un-natural. Also how it was broken into the 4 parts at first seemed crazy, but after doing the suggested research, and taking a closer look at how I produce my items as well as time management, I really feel enlightened with more insightful into how to do correct retail pricing. Thank you so much for posting this video.. Peace!

The article was very helpful, but you also have to keep in mind the time it takes to photograph your items, edit them, wait for the right sunlight, if you want outdoor shots, plus the the time it takes to describe, tag as well as price. Also I should be so lucky to sell 2 items per day as per the formula! I am lucky to sell 2 items per week! I think my prices are competitive compared to other shops that sell similar items. I would like it to be more than a hobby, but it isn't happening. It does blow my mind when I see a pair of Swarovski crystal earrings with lamp work beads and sterling findings for $5! And then offers free shipping to boot. I want to contact these people and ask what is up with that?

I've been doing etsy for a couple years but didn't really work at it year round till the last 6-8 months. I agree with above comment. People have no clue the amount of time it takes to photo and to write the description up. No two things I make can use the same desription. Sometimes If I make (say Christmas stocking gift card holders/ornaments) I can take the same basic description and change the colors and the prints. I usually design almost all my items so that has to be included. I find it hardest to figure out how much to charge for shipping.

Hi Danielle, I have a question. I have been putting my packaging costs (bubble wrap,boxes,tissue paper,thank you card) into the shipping cost. Is this ok? It made the most sense to me. Thanks! Nicole

thank you so much for great info..

Hi Danielle, just watched you video, and it really helped, as I need all the help I can get, just opened my shop on Oct. 27, and still have yet to make a sale, I think my pricing is pretty well competitive, and I just don't know what I'm doing wrong. I just learned about being on teams, and I tried to join one lastnite, I forgot which one, anyway got an e-mail back saying I couldn't join that one, never got a reason back why???But really enjoyed your video, at least I got the pricing down pat pretty good thanks to you!!! Now I know about these videos too!!! The more I watch the better. Thanks again, Justine

Is there a comparable formula for vintage sellers? That would be very helpful. Thanks, Amie

Very very helpful and super timely article!! We also realized it was time for a price change. Our items despite being laser cut, cut are still pretty labour intensive to cut, assemble, paint, etc. Also we purchase our materials at retail price which creates quite a bit of cost already. Throw in wholesale and we were making about $10/piece for all that work. Furthurmore i do this with my boyfriend making it a 2 person effort. Still not entirely sure if our current pricing works, but it now allows us to take in wholesale and consignment! Will definitely do a recalculation using the tips above!

Thank you for this !!!!!!!!

This is such a wonderful article. But I have done all of this, recalculated, raised my prices to way above the going rates for my items, and then I don't get sales. I think just raising your prices and then just sitting there waiting for sales to roll in will not work. Perhaps they could add something else to this article about how to actually get sales once you raise yout prices.

This is very interesting. I am just opening my store on Etsy and so really apreciate the information. Having been in sales of various kinds for years, I have noticed that both buyers and sellers have trouble understanding what a fair price is. A fair price is not always the most competative price - which is why so many artisans went out of business when the industrial revolution happened. Mass produced, machine made products will always be cheaper than hand made. So, if your product looks the same as one from a big box store, you won't be able to sell it at a fair price. Period. If you want to get a fair price, you need to stand out.......and you need to be realistic. If you want to sell to average moms, only use materials that will keep your product in the right price range. Just because you love making something, doesn't mean you can sell it for a fair price. The market may just not be there. So, if you want to make a fair profit, and aren't, look at changing your product or production methods. Consider whether the item you are trying to sell is really a good candidate for sales at all. But for pete's sake - Don't take complaints about your prices seriously! People will always complain about prices no matter how low they go. Don't undersell yourself! Would you really go work for someone else for $5 (or less)an hour? If not, then don't do it to yourself either. Find a way to add value to your product and then be brave and charge what it is worth. If you are having trouble with sales, ask a money (or business savy) friend or consultant for advice about your product. Actually, only ask a friend if you can trust them to be brutally honest. Check your marketing strategies. Lowering your price should be your last resort. Thanks for such helpful information.

I want to offer my item at $15 each or 2 for $25. How do I handle this if and when it sells? My item lists $15 as the price. I put 2/$25 in the item description. I would need to adjust the shipping also on the sale. Help please, I am just getting started on Etsy.

I have been wondering about this! Thank you for the article. It was very helpful and informative. You brought up things I didn't even think about or take into consideration.

If anyone on here could take a look at my shop and give me a critique I could do the same for you. I have been selling a few of my silhouette ornaments but not sure if I'm undervaluing my work as it takes quite a bit of time to get the materials, make the silhouettes, convo with customers, list items, etc... I really want to do well on here just want to make sure I'm not wasting my time. This article did help though, just makes me feel like I need to raise my prices a bit on certain items.

Such a wonderful article, I've bookmarked it! P.S. Danielle, I miss you!!!!

Thanks for a great video! the first one I've watched since opening my shop a few days ago and I'm still struggling with pricing! Back to the drawing board (or Excel spreadsheet to be precise!) thanks again, great dynamic by the way & love your energy!

Great tips! Thanks!

This is a very encouraging video! I realized that I'd been underpricing most of my items, so I started raising the prices little by little and am still making sales. It's great to know that I'm on the right track!

Great advice! I struggle with pricing since I invest a lot of money on quality materials, but hate to charge much for my designs. This video really encourages me not to be afraid to charge for time and packaging as well. Thanks!

this was extremely helpful to me. I've kept my prices a tad lower assuming that would help bring in customers, but that's not proving true!! I believe I do quality work and I put so much time and effort into everything I make! We should be rightly paid for our work. Thank you!!

I constantly come back to this post. It's good information! I'am currently revamping my whole store with new products and I want to make things right. I think having goals is essential and I am starting 2013 fresh! :) Thanks again Etsy for those useful technical posts.

Thank you so much. Now, I understand how others get their pricing. This is something I have been struggling with for some time now. I will work on fixing it right away. After the formula I saw that my prices were pretty much on target, more or less, but I hadn't add anything for my trouble or retail price. I am trying hard to do the right thing here and after I fix my pricing, it should help everyone.

I studied all these pricing articles, followed the formulas, and still had to lower my prices, because I don't think the market will support it. I tried to have confidence, my designs are complex and are made of the highest quality. I tried to follow all the shop suggestions. This all sounds great but I still haven't made a sale. Now I feel like I should just lower prices to match everyone elses although I won't make any money. Or should I just close up shop? Am very confused.

Great advice =)

Thank you for this informative article. I have just opened my shop with a couple of handmade baby sets and will try to add one or two items daily. I found the business side of selling difficult but I'm sure with time and fine articles like this one I'll soon be selling. Thanks again!

Pricing is sooooo tricky. I've moved prices up to get closer to what these pricing guides tell you and I'm still not making sales. Maybe other considerations, such as number of stock, factor in whether or not sales are made and this should be discussed?? Not sure, but there is definitely a lot of trial and error in the beginning here.

Thanks for the tips. Most helpful. Will be using these ideas and tips in the future. My shop is new and articles like this are really helping me out.

Not only is the article very helpful, but all the comments from other sellers. I need to do a bit more research re: how I price my things. I probably don't price them according to the work I put into them, but I think as a newby my pricing is fair. We shall see I guess. Thanks to every one for sharing feedback and to you for all the tips.

Checking sallary ? You know what ?A tailor in my country makes hardly 2,5 € a hour ,and he has to pay 20% tax from that ...

Loved it! Thank you I hope it's okay my price goes way up all at once. I have had contests to give away my designs as a marketing technique but since I haven't really sold anything it's okay that I up to par my price immediately in my category. Thanks again. I also gained some insight how my story and really unique services give my items more value. I always thought it wasn't as important but now I do and I can enjoy what I do even more!

Just wanted to say thank you for the tips! It really helps to have the advice. Pricing is tricky and I really do not want to sell my self short or over price. The formula really helps to put things into a clearer perspective.

Thank you for your tips. This is really helpful.

If I followed this formula, I'd be selling a pair of my pot holders for over $50, which no one will pay! I understand the concept, but the reality for me is that I can't follow this and expect to make a sale at all.

This is really helpful, because I think some of my pricing looks erratic (or it just is). It's very difficult for me to price pieces. I'm going to try your advice and see how it goes, especially since I am new to selling (not buying) on etsy. Thanks so much for the article.

I've seen this formula used many times and in an ideal world it would be great. But I make doll clothes and there is tons of competition. People seem to be giving their stuff away and making tons of sales. I haven't sold anything and it's frustrating. Ideas? Emma's Doll Shoppe

I agree with the people above me here - I think the price theory here is great , in theory, but when customers can purchase cheaper products that are "similar" they vote with their wallets.

One little ditty I heard which I think will be helpful for those who worry that their work is priced to high. There was a little sign on the wall of a hardware store which simply said (When the customer complains that the price is too high) That your competitor is in the best position to know what their work is worth. That kind of sums it up for me.

"...Here’s why I’m going to beg you to double your wholesale price and sell your work at a true retail price..." Those are your words as a representative of Etsy yet Etsy constantly features items on FB that are priced well below value and highlights them as a great deal!

You saved my life! Thanks :)

Hmmmm...Lots to think about! I think I need to do some calculating!

Thanks, someone thinks instead of us for our benefit :)

Thanks soooo much for the pricing info it is very helpful!

I started construction business in 1972. I was charging $5 ph and 20% mark up. One day three other contractractors cornered me and taught me what this article is about. I raised my prices to $10 per hour - marked my materials up to 50% profit and I had to work less time and made more money. I was in business for 47 years. Thanks to my competition I had developed my pricing. I was not only hurting me with low pricing I was effecting them as I was under charging their customers that called me. My capture rate fell from 95% of calls to 65% of calls and I doubled my income and got better customers.

I have a tendency to get bogged down in details, then just give up and throw a price on there... It's easy to account for things like the jar you had to put something (like a beauty product) in, but how do you account for things like essential oils which may make 50 products? And even then it's hard to tell how long different last...

Great article! Pricing is always a little tricky, especially when prices for things are so different in different parts of the world, like studio space!

here I thought just materials + desired hourly/time+.5=price

I had been concerned that my pricing was too much. This article puts me dead on! I feel much more comfortable now but other shops have the same products at a consistently lower price. I had to match what my soap sells for at the local shop. I would loose my standings with them if they had to compete with my web site. As mush as I love selling close to home I need the outreach to broaden my customer base. I think others are not considering the time checking for orders, the time spent packaging or the liability involved with these extra steps. Maybe I am just using more of the pricey ingredients then they. At least I know know that I haven't over priced my inventory. Thank you so much for taking the time to put this together. It is very kind of you. :) Jamie

Thank you for taking the time to help us with pricing (one of the hardest parts of running a successful business). Keeping a balance between offering quality goods as a reasonable price, and making a profit is always a struggle. What great advice Danielle! Thank you.

it's very useful info, thank you :)

So... Do I read the formula correctly, and "Materials + Labor + Expenses + Profit" is your retail price? And also twice your wholesale price, so wholesale would be half? Or do you mean "Materials + Labor + Expenses + Profit" is wholesale, and you get retail by multiplying that? I still don't really get the formula because I wouldn't add in profit - it's a side job, I don't want to quit my 'day job' (college) and if I want a new sewing machine I'll use my 'labor' price for that, I think... Because I also use it privately. Or maybe divide the cost over a couple of month's of sales. What do you use profit for?

Now I watched the video and I understand what the formula means, but I think it's written wrong. Right now it says that all those costs add up to twice the wholesale price, which it doesn't, it's just the wholesale price and you double that for retail. It should be two different formulas. But then, using this formula, my prices would be ridiculous! I even think prices would be high if I factor in a profit (I want to make a 15 euros hourly wage, maybe that is too much?), but then you DOUBLE it? And the girl in the right in the video talks about doubling material cost, then factoring in wages and then doubling it again at the end! Would you buy a shirt if it cost 137 euros and was pretty basic? (materials 8 euros, 3-4 hours to make it... not even factoring in profit yet!) (I was thinking of selling that shirt for about 60 euros, and maybe not selling it at all because it's too expensive... too much work to make!)

Thank you, this is a very good article. because it is useful for me and my online store. Greetings success.

I've read over this about twenty times, and I don't understand it at all. I'm keep getting that I should be charging $20 for a 2 oz bottle of lotion. I feel like there's some sort of crucial information missing here - a more detailed example would have been better, rather than saying "I'll let you come up with what you're going to put down for profit, and I'm not going to show you any suggestions." I mean, is this profit for an entire year, or what? And I can make like 10 lotions a day, but I can make 20 bath salts. Would I be using this formula for each and every item? Either I'm too thick to understand, or this doesn't really apply to me. Either way, it's giving me a headache.

Will be using these ideas and tips in the future. My shop is new and articles like this are really helping me out.

Thank you so much for the pricing info, it is very helpful!

Thank you so much , this pricing Info is very help full, as a newcomer you question everything. This is so very nice of you. Thank you again!

This was SOOOOOOOOOO helpful to me - pricing is something I have always struggled with as I feel bad if I price things "too high." I love that this helped me break down the actual cost of things that brought things back to being logical rather than an emotional decision on what to price.

This is really helpful. I used to just eyeball it, and one day I sat and started re thinking about my pricing, still I seemed to be missing the "expense" part. This is one thing that many maybe overlook. Especially if you live in the outskirt where going out buying supplies is a lot of expenses. Thanks for the simple guide!!