This seems the be the big struggle for new handmade sellers all around the board -how to accurately price your items so you’re getting what you deserve. My best advice is to not fall into the “what would I pay for this” trap. But rather realize that just because you wouldn’t pay $10 for it, it doesn’t mean someone else wouldn’t pay the $25 it is actually worth.

Here are five tips and starting points to get you on the right track of pricing your items the RIGHT way!

1. Take Materials Into Account

This one should be obvious. For me, I have to think about how much wool I used (core vs. dyed), any embellishments, and the glass black eyes. Think about every step of making the product.

2. What About the Materials You Missed?

Did you sew the item? Did you take into account the sewing machine, the needles, etc? What about your camera to take the product photography? This takes some thinking about and you can use several guides to calculate your overhead to take those supplies into account that you take for granted. This Simple Biz Planning worksheet is a great place to start! For me, I have to remember to think about my felting needles and all the different types of mats I may have used.

3. Finishing Costs?

Are you paying for a website? Or selling on Etsy? You might have already included it in your “overhead costs” but don’t forget about any fees from Etsy, Amazon Handmade, Paypal, etc. Are you packing it up to mail or attending a fair? Either way, you have costs! For packing, think about the box, wrapping supplies, postage printing, and insurance. For a fair, you not only have the initial fee to take into consideration but also any decor you might be using (tent, table, shelves, etc).

4. Time Yourself!

This is the one most people skip or estimate on. I like to use a timer to see exactly how long it takes me to felt an animal. My projects tend to take anywhere from 45 minutes to 4 hours or longer. Multiply the number you get by your desired hourly wage.

5. Markup?

You have the base price of your items. Now think about markup! The prior four steps were all about how much work you personally put into the piece. Do you want to sell at cost? Or at a margin?