- Costs - Every artisan encounters different costs. Some may buy supplies at a local craft store while others buy supplies wholesale. Some artisans are able to make some of the supplies from raw materials and some are lucky enough to get what they need for free.
- Fees - This is an area many newcomers to Etsy seem to struggle with. You pay 20 cents each time you list an item and 3.5% of the final sale price on each item sold (not including shipping). When a buyer pays you using PayPal, PayPal will deduct 30 cents plus 2.9% of what was paid. These amounts need to be factored into your price. If you decide to renew listings on Etsy so they show up sooner in searches, you will be paying a new 20 cent fee each time. Even though you may see this as a marketing expense, you still need to account for it.
- Time - How much is your time worth? If it takes me two hours to make a tatted butterfly, block it, and fasten it to a pin back, do I charge what I would make at my regular day job? Probably not. This part is linked to the next item...
- Quality/Expertise - I don't charge as much for my graphic design work as a lot of others do. My work is at a hobby level and doesn't compare to that done by designers with degrees. What I offer is enough for those who need something simple and affordable, so I price it as such. Beadwork, sewing, jewelry making, knitting....whatever it is that you do, your expertise should be a factor in the price. People expect to pay more for designer clothing, but less for those from an unknown brand.
- Customers - Who are you trying to sell to? When you decide to market to housewives, boutique shoppers, bargain hunters, the affluent, or those with eclectic tastes, you are choosing a price range. Working backwards, you can adjust the materials you use and the time you spend so they fit in that price range. Deciding whether to use 14K gold or gold colored settings for the jewelry you make is an example of this.
Friday, August 27, 2010
The Art of Pricing" that explores this subject on a variety of levels. Here are the things I try to consider when establishing prices: