Imagine this: a beautiful jewelry studio, a soldering station, an anvil on a nice old worn wooden stump, a handmade jewelry bench, and on top of all this lie piles of finished pieces. Behind the bench sits a jeweler who has yet to sell a single one of her creations. What�s holding this talented artisan back? From my years of listening to your stories, putting a price on your work is one of the most intimidating first steps to selling, and delays many from opening their shop. I�m here to share my favorite pricing formula with you, and to break it down so you have the confidence to get out there and sell!
Know the Formula
Here�s my favorite formula:
Materials + Labor + Expenses + Profit = Wholesale x 2 = Retail
I picked this up from the amazing Megan Auman. What I love about this formula is that your profit is properly accounted for!
Now let�s go through every part of this formula and break it down.
Make sure to cover all your material fees. Often forgotten: the little things like the cost of thread, and the bigger things like the cost of packaging. If you�re going to �guesstimate,� err on the higher side!
If someone wanted to hire you and they offered you $7 an hour, what would you think of that deal? Be a good boss to yourself and do a bit of research. How much does a seamstress make in San Francisco? Find out! (Also remember, you�re probably more than a seamstress � you are the designer, the marketing department, the accountant, the janitor, and the administrative assistant, too.)
Bubble wrap, that ebook purchased at 3 a.m., studio rent, bus passes required to make it to the studio every day, a new scale for your shipping station. How the heck can you fit all these things into the price of a single item?
Here�s a way to do that:
Jot down every expense you can think of � for example, include your Etsy fees, office supplies, rent or utilities.
Next, come up with the number of items you�d like to sell a month. Divide that number into the total expenses.
Tip: Start doing two things to help you come up with an even more exact price:
Track your expenses carefully so you can come back to this as you learn more about selling! I suggest trying out Outright � a free online accounting tool.
Start figuring out the big investments. How many items can you get out of that sewing machine? How long will that postage printer last before it needs to be replaced?
Read more here:
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