How to Price Crafts for Profit

Learning how to price crafts is essential if you're going to run a profitable business and maximize profit.

Pricing can be tricky, and many new craft business owners miss out on potential earnings because they make the mistake of setting their prices too low.

There's no single correct method for pricing crafts. Different methods will make sense in different situations. It can be smart to consider more than one pricing option and find the one that works best for you.

How to Price Crafts for Profit

How to Price Handmade Crafts

There are three common strategies that work for pricing many types of handmade products: competitive pricing, cost-plus pricing, and value-based pricing. Here's how to price crafts using each method plus advantages and disadvantages of each pricing strategy.

Craft Pricing Formula

Using this formula to price your handmade items will ensure you're covering your expenses, adding in profit, and charging enough to sell your products to wholesale or retail customers.

Even if you choose to use a different pricing method, it's smart to run your numbers through this formula to learn the minimum you need to charge to break even and discover opportunities to increase profits.

Craft Price Calculator

This free online calculator is based on the craft pricing formula described above. It's a handy tool you can use to quickly calculate the break-even point, wholesale, and retail prices for your handmade items. You can also use the calculator to experiment to see how changes in profits and different types of expenses impact pricing and profitability.

Business Expenses & Craft Pricing

To know whether you've set your prices to make a profit, you need to know all of the costs involved in running your business. That information can be tricky to know when your business is new. It's easy to overlook items. This list of common costs involved in selling handmade items will help you assess your own business expenses.

Make More Profitable Crafts by Maximizing Perceived Value

Perceived value is the value shoppers assign to your product, which is closely tied to the amount they are willing to spend to buy it. There are plenty of ways to ways to increase your product's perceived value, so you can charge higher prices and optimize potential earnings.

Here's a list of small and large changes you can make to your products to increase your their perceived value and make the most of your potential earnings.

Factors That Influence Pricing Homemade Crafts

Perceived value is also influenced by factors that are completely separate from your actual product. Here are more ways to increase perceived value, this time, by making strategic choices about factors outside of your product's design.