How To Price Your Products Without Fear
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Hey there, crafty friends! Today we’re diving into a topic that can sometimes make even the most seasoned artisans break into a sweat: how to price your products. But fear not, because I’m here to guide you through the process with confidence and ease.
Why Pricing Matters
Before we get into the nitty-gritty, let’s take a moment to understand why pricing is such a crucial aspect of your handmade business.
Your prices determine your profitability, impact your brand’s perception, and can make or break your sales. So, let’s get started on how to price your products without fear.
How to Price Your Products: The Basics
Understand Your Costs
First things first, you need to know exactly what it costs to make your products.
This includes materials, labor, overhead, and any other expenses related to your craft.
Be thorough in your calculations, and don’t forget to account for your time and effort.
Be sure to read The Real Costs of Selling Handmade Items Online to ensure you have everything covered.
Research Your Market
Take a look at what similar products are selling for in your niche. This will give you a benchmark to work from.
Keep in mind that prices can vary widely, so consider the quality of your materials, your unique selling points, and your target audience.
Come up with a range of average prices, and label them based on why you feel they are priced that way. For example, you may see some handmade wreaths listed at $175 and others listed at $32.
Take a look at the materials, and think about the time it took to make them.
If you look at the first page of Etsy’s wreath listings, you might come up with a range of $155 to $1.50 (not lying!). Add up all the prices on that first page (do not include the products that are ads, just the organic results).
You should have about 48 listings. In this example, you may come up with an average price of $44.
So now you have an idea of pricing, why certain products are priced they way they are, and what the average price is for the products you’re selling.
Set Profit Goals
Determine how much profit you want to make from each sale. This will depend on your business goals, but it’s essential to have a clear idea of what you’re working towards. Your pricing should support these goals.
One way to do this is to decide how much you want to make per hour. Divide that by the time it takes you to make one of your items. If you can make 3 in an hour, and you want to make $20 per hour, that means the amount you would add to your pricing is $6 – $7.
Building Confidence in Your Pricing
Value Your Skills
Remember, your handmade items are a labor of love, but they also represent your skills and expertise.
Please don’t undervalue the time and effort you’ve invested in perfecting your craft.
Customers appreciate quality and are often willing to pay for it. Charge what you are worth! If someone says your pricing is too much for them, then they are not your customer, that’s all.
Embrace Transparency
Honesty goes a long way in business. Be transparent about your pricing, and explain to your customers why your products are priced the way they are.
If you use premium materials or have a unique, time-consuming process, let them know.
Transparency builds trust.
Test Your Prices
Don’t be afraid to experiment with your pricing. You can start by offering different price points for similar items and see which ones sell best.
Over time, you’ll get a sense of what your customers are willing to pay.
Addressing the Fear Factor
Overcome Impostor Syndrome
It’s common for creative entrepreneurs to doubt their worth. Remember that you’re not an impostor; you’re a skilled artisan. Believe in yourself and your creations.
Underpricing is the biggest issue I see with new craft business owners. One way to ensure your confidence when pricing is to use an online calculator to show you what your pricing could be. You will probably be shocked at the price suggestion!
It’s also important to look at the market, and perceived value. But you are in this to make money. Make sure your pricing gives you a profit at the end of the day.
Fear of Rejection
You might worry that higher prices will scare away potential customers. While some might be price-sensitive, others equate higher prices with quality.
Focus on your target audience, and remember that you can’t please everyone. If you receive negative feedback on your pricing, you can just remind the complainer that your products may not be within their budget, and that’s ok.
Monitor Your Progress
Keep track of your sales and how they correlate with your pricing strategy. This data-driven approach can help alleviate your pricing fears as you see what works and what doesn’t.
How to Price Your Products Without Fear
Pricing your handmade products doesn’t have to be a daunting task. By understanding your costs, researching your market, and setting profit goals, you can lay a solid foundation for pricing success.
Remember to value your skills, embrace transparency, and test your prices to find the sweet spot.
As you work on your pricing strategy, don’t let fear hold you back. Overcome impostor syndrome, don’t fear rejection, and continually monitor your progress. You’ve got this!
If you’re embarking on a new journey into building your craft business, I’ve got a map for you! My free guide, Online Selling Must-Haves for Makers, will give you everything you need to know to successfully launch your handmade business online. Download the free guide here.
Thank you for this guide! I will be doing some markets after surgery. Expanding my offerings – they were well received before the stroke heading into Fall! I won’t be doing as many markets this holiday season due to the stroke. But the ones I am vending at will be awesome because of this guide!