Pricing your handmade products sucks…
That’s just the truth. It makes the impulse to do some of these things very real! It is true that pricing is hard, and it inevitably involves math which, for me, makes it even worse.
There are lots of best practices for pricing your handmade products, I’ll point you in the direction of our top pricing resources in this post! For now though, let’s make sure you know what NOT to do.
Before we get started, I want to remind you that underpricing is bad for everyone, not just you!
Here are the 4 things you definitely do not want to do when pricing your handmade products for sale on Etsy, Shopify or anywhere else.
1. Think that just because you enjoy doing the work doesn’t mean you shouldn’t be paid for it.
AKA: stop basing your prices on how much you don’t hate doing something.
Okay, I know you sometimes sit on the couch while you work. But knocking a couple bucks off because “well i was watching Netflix, it was enjoyable” is NOT the way to do this. Pricing is a signal and if you don’t treat your work like a job no one else will either. Use your prices to signal to your ideal customers.
Pricing your handmade products is not based on how much you suffered. It is not based on how “hard” the work was. Don’t feel guilty for charging for work you enjoy or that comes easily to you. It’s still work.
2. Ask random groups of people what they’d be willing to pay.
If I see this one more time in my life, it’ll be too soon. Makers, do not go to these giant, free Facebook groups and ask a completely random group of people what they would be willing to pay for your item. It’s nearly impossible to give them full and proper context (also, I’ve never seen anyone attempt that) and it’s just plainly irrelevant what people say in response. You need not know what someone else is willing to pay – it’s none of your business. High or low, it’s none of your business what someone is willing to pay for ANYTHING. Likewise, if you ask a random group of people, the feedback you’re going to get can be nothing other than random… it’s not going to help you and you’ll end up feeling more confused. It’s a big mess. Avoid it.
3. Think that price is THE determining factor in a buying decision (or even a huge one a lot of the time.)
It is super likely that if you are reading this post, the items you sell are gifts, luxuries, for fun or otherwise non-essential items. You are selling something that is going to hold sentimental value, or that is going to be a gift, or that someone is buying as a treat to themselves. This isn’t the plastic baggy aisle at Target. Of course, people might price compare or shop within a certain price range, but if what you are selling is unique enough, different enough or engaging enough or YOUR OWN enough – people are less likely to price compare. On top of that, price is not usually THE deciding factor in buying items like yours. In almost any instance that I am shopping for a gift or a luxury item (particularly for a wedding or baby), I am weighing other factors more heavily than price. You might also need to hear this: you cannot compete on price. There will ALWAYS be a cheaper option. So don’t compete on price, compete on everything else.
4. Forget to factor in the work you did before and after making the product.
All the work you do to bring a product to the market and to deliver it to the customer is work you need to account for. Photos, listings, shipping, packaging time, overhead costs… all of it. All the things you do to make sales also need to be factored in: promotional time and costs, for example. Don’t JUST factor in your time and materials to make the product.
Don’t forget: you can charge a premium for personalization, customization, and other things that usually do not appear in the pricing formulas you get on Google.
In summary, all the work you do is work.
If you feel like your prices might need to be re-evaluated but this time you’d like to do it with a bit more guidance, I am inviting you to check out a free workshop that Janet from Paper and Spark and I created – 3 signs you need to change your prices asap. You can watch it on-demand right here.