Pricing

[Former_Member]

Hi Guys! I just joined this team! Very excited for all the info I will learn!

I am concerned with pricing. I have a huge fair coming up so this is of paramount interest to me right now. I read this article: https://blog.etsy.com/en/2012/a-simple-formula-for-pricing-your-work/. In it they describe the pricing formula like this:

Materials + Labor + Expenses + Profit = Wholesale x 2 = Retail

This concerns me! Yes I would love to sell items at that price, however, I do not know if I can sell them at that price! I sell mostly crochet items (at this fair). They take quite a long time to create! Looking around Etsy, I try to be competitive with my pricing and that just throws this formula to the wind!

If I followed this formula for my Hamburger Coaster Set, I would have to charge at least $30! And that is with Profit margin low. I know I know, I need to make money to make this a business and not a hobby, but I need sales first!

If I followed the formula for a Doggie Sweater I would have to charge at least $78 with NO PROFIT MARGIN. Other people are selling them for $30! That is why I have settled on $25. I try to think of most of those parts of the formula except TIME. That is the big factor for me.

Please I would love suggestions, insights, experience, critiques! After my fair I will be adding a lot more items and continuing to work more on my online shop.

I appreciate you! Thanks!
xoxo
Robin

[michellemach]

Your hamburger coaster set is adorable!

It's good to see what others on Etsy are charging for similar items, but I wouldn't use that as your only comparison. You'd want to also look in boutiques, galleries, or other shops that sell similar items. Think about how you're different--do you make your own designs? Use special materials? Have super cute packaging? Those can be selling points that will make customers want to buy your items instead of someone else's. Price is not necessarily the deciding factor for everyone.

[ObjectApparel]

Sometimes having the cheapest prices doesn't lead to more sales. I associate cheap prices with lesser quality. So if everyone is selling them for $30 do it for 50 or 60 and do it better! People will assume the quality is better especially if you have nice pictures!!

[Former_Member]

Pricing fairly in crochet items is difficult. Crochet has a low perceived value and lot of competition, so making a viable business out of it can be hard, specially if you price according to what others price at. One thing that makes it hard when the majority of your competition is selling as a hobby and so do not need to earn a living of their work, making their prices artificially low.

I used to try and sell my iron work and silver work at local fairs and historical markets. However neither was a suitable place for my work, as people except to pay a maximum of £10 on a purchase and my prices then averaged £40. Part of the problem was being set up next to hobby makers selling their work for little more than their material costs. So even my most economically priced items looked extraordinarily pricey, even though I was hardly making ends meet.

With fairs, the type of fair will affect the perceived value of the things sold there. This is why you would not sell a Matisse painting at a garage sale. I looked into selling at some of the more high end fairs, but the entry costs where so high it meant I simply could not produce enough to make it worth my while.


I wrote a rather long post on pricing a couple of days back. Here is the link :-)
https://www.etsy.com/teams/5002/etsy-success/discuss/16564554/page/1?

[RomaMiaTradingCo]

The formula i use for pricing is: Materials+Labor x 20% profit x Any fees (paypal and Etsy). My prices are pretty spot on for what other people charge .

I knit, so I understand where you are coming from. But I started selling a lot more when I actually raised my prices to what they should be.