Pricing handmade products is so challenging, but this is a critical topic (obviously.)
Today I’m recapping some of my top pricing reminders for handmade business owners because I know the struggle is very real, and I need to hear these things more than once, too!
If you are a long-time listener of The Merriweather Council Podcast, you have probably heard some of these things before – maybe even more than once! I wanted to smash them all together so we can drive this home! Pricing is such a vital topic in ANY business, and I know it is difficult to feel confident about pricing in handmade.
This list is not in any particular order. All of these reminders are all TOP. No one of these reminders is more important than the others.
You cannot price for “affordable”
Number one! Or, the first thing on my list: You cannot price for “affordable.” Affordable is not a number.
When I speak to handmade business owners about pricing, what I often hear is, “I don’t want to make it too expensive” or, “I want my prices to be affordable” (and similar sentiments.) Those sentiments sound nice but are meaningless.
What is affordable? That’s not a number.
What is expensive? We all have different opinions about that! I might think something is expensive, and you might think it’s affordable! So now what?
It’s none of your business what someone will pay for something – high or low.
Affordable is an ambiguity, and you cannot price for an ambiguity. You can, however, price for profit. Profit is a number.
Running a business that sustains itself is not luck or magic; it’s math. *Groan* I know we all hate math, but do the math and figure out your profit price. Selling at your profit price is possible. You might need to tweak to your current brand and shop but, that should not stop you from pricing appropriately, aka for profit. It’s more important to be profitable than to have a lot of sales and make no money; that’s a recipe for burnout.
You can’t just raise your prices
With that, let’s get to my next pricing reminders for handmade business owners: You cannot JUST raise prices. You need to elevate your brand and business infrastructure to support and justify those prices. You can do that, absolutely – you can build a business that supports the prices you want to charge. Some sellers do not have to change a lot, or anything, to raise prices (because they were underpriced so significantly to begin with) but some do! Just consider that sometimes, it’s not as simple as just raising the price, which is okay and normal. You might need to elevate the quality of your photos, website, customer experience, or something else. It is all doable tho!
You need to have the infrastructure to support your prices
The third thing I want to remind you of is that you can sell your product at the price you need to to be profitable and sustainable, you just have to have the infrastructure to support it. If you are annoyed by underpricing in your niche, the solution is to NOT participate in that.
Don’t bring yourself down to meet the result of bad pricing practices, price appropriately. You can’t compete on price. There will always be a cheaper option. Compete on other things. You have to be willing to let go of “competing” on price. The super low prices you see other people setting for items similar to yours is NOT an indicator of what the market can handle, it’s just what other sellers have decided they are okay with settling for.
Likewise, you are not competing against Target, Walmart or Amazon so the fact that someone can buy something similar to your product at any of those places is irrelevant. If you honestly think you are competing against any of those, there is a different discussion we have to have.
pricing helps you attract your ideal customer
This is a great segue to my next pricing reminders for handmade business owners: Pricing helps you attract your ideal customer. If you are having a lot of negative interactions with your customers – that is a sign you need to evaluate your pricing. (Usually means you need to bring your prices up a little bit.)
If you feel UGH rather than YAY when you get sales, more often than not, that is also a sign it’s time to evaluate prices.
Pricing impacts your whole business
As discussed, this list isn’t in any ranked order but I do want to emphasize this pricing reminder: Pricing impacts your whole business. It is the foundation on which you build things long-term. Things will not take off until you understand the value of your time and behave in a way that is respectful of that time, aka price appropriately.
This might be a tough-love alert right here but it needs to be said. Take the discount code off your social media bio. If you wouldn’t introduce yourself as a ‘jewelry maker offering 15% off” then it shouldn’t say that in your social media bio either.
Stop leading with discounts
That is an excellent segue to my next reminder: stop leading with discounts and people will stop expecting them. Discounting and whether you offer them or not is part of your pricing. Consider this: you work hard to reach and engage with your ideal customers, don’t diminish the relationship you have with them by devaluing your product from the first time they meet or interact with you. Save your discounts and sales for special events and long-time, loyal followers.
Sales being slow doesn’t change the value of your work
NEXT! The value of your work doesn’t change just because sales are slow or things are going on globally. We saw this very clearly in 2020. So many of our Council Members reported that 2020 was their best year yet. The value of what we provide as product sellers might change in terms of what people value about it. It doesn’t change as in, poof, gone, no longer valuable.
In 2020, many people sought out products like puzzles because they are a fun indoor activity, and people VALUED having things to do inside, that wouldn’t involve screens more than usual. In 2020, people found a great deal of comfort in little luxuries they could enjoy at home like bath bombs. Bath bombs are always valuable as self-care products and as something to enjoy at home. Still, things like that became even more valuable in a world where you couldn’t go to the spa or get a manicure or whatever normal out-of-the-home type of self-care things people usually do. When the options got slimmed down, like so many other things, we valued the things that remained even more. See how that works? Your product and what you offer and provide in terms of benefits to people doesn’t change. People will always want benefits. No matter what is going on in the world. Don’t assume people don’t want or need you!
Just because you enjoy doing the work doesn’t mean you shouldn’t be paid for it
Finally, just because you enjoy doing the work doesn’t mean you shouldn’t be paid for it. Also known as stop basing your prices on how much you don’t hate making something. It’s still work! You still provide value. There are four things we think you should never ever do when pricing your handmade product. One of them is basing your prices on how much you don’t hate doing something. You must treat this as a business and as a job. Particularly if you want other people to value and respect your work, you need to treat your work as work! It’s just that simple.
There is a market for every product at every price point
One more bonus pricing reminders for handmade business owners right here: there is a market for every product at every price point.
Don’t be afraid to charge what you need to for your business to be sustainable and profitable, regardless of what everyone else is doing.
Thank you so much for joining me today. If this episode was helpful to you, be sure to share it with another maker, it’s likely that if you found value in it, someone else will too! We appreciate all of your shares, particularly when it comes to pricing; the more people in our community who can be more educated and empowered in this area, the better it is for all of us – the whole community benefits from that! So, we appreciate it. And as always, if you are comfortable with PDA and you love The Merriweather Council Podcast, leave us a positive review on Apple! See you on the next episode.