BASIC How to price your handmade!

Courtesy of  Mis Fid, ACG member  (written on Wednesday, 08 June 2011 at 10:38)
MANY THANKS, FID!

From my observation of Malaysian crafter selling their handmade items out there,  I see that sometimes some of them or maybe nearly all set their price way too low for handmade. Here, I would like to share some of my knowledge in how to price your handmade. I'm not a pro in the biz field but I read quite a lot from the net & biz books on pricing handmade/craft.

So here's what I can summarize from the info that I know.

• The basic formula for pricing (for any biz out there) is: 

MATERIAL COST (including glue, label, packaging, electricity, water etc ) + LABOUR COST (time needed to complete) = BASE PRICE 

Of course for biz, you won't want to sell your item in base price / minimum price(mana nk dpt untung kan?)

• So for RETAIL PRICE (end price for customer) you should at least price it at x2 or x3 times of your BASE price. 

• For WHOLESALE PRICE normally u'll need a min order quantity &pricing should not be lower that half of the RETAIL PRICE (that's the min ok guys!). Discount should be given around maybe 15-25%depending on the order size/quantity.

• But there is also some other stuff to consider, sometimes u need to check out the market price for your item & adjust the pricing appropriately.

• For certain type of craft such as crochet, knitting & jewellery making which need skill & more labour time, the price would be concentrating on the LABOUR COST more!

• For small biz like us crafter, especially CUSTOM MADE ORDER orMADE-TO ORDER items, it is advisable to get deposit or advance fees first at least 1/2 of the item(s) price.Maybe you should also consider theextra charges especially for CUSTOM MADE ORDER (example, when need  to create a new design according to customer demand etc)

Just my advise, after you figure out your pricing, stick with it. Don't just simply lower your handmade price just because ppl bargain especially when it's lower than your material cost! It will be only a big lost to u except you are just willingly give your labour cost for free to every customer you have.

Oh don't be afraid to change the pricing if u need to do so. There will be always a fluctuation in pricing of materials you buy (eg. rise of fuel price cause yarn price to go up).

Please guys, try to set ur handmade price appropriately as u are the only one who know how difficult to make them. I always believe that the ppl who appreciated handmade (good quality & unique) are the ppl who willing to pay for the price of the handmade no matter how expensive it is. Hope that these info will help you all in your craft biz!

p/s: Do comment if there is any mistake in my notes or any extra info, do feel free to add! As I've mentioned, I'm not that pro in the biz field. Sharing is caring! :) 

Majulah Kraf Malaysia! Support Malaysian Handmade!  ;) 

Mis Fid 
FB Page: MisFydKrafts
Blog:        misfydkrafts.blogspot.com


NOTE* Feel free to share with your friends but do let me know ya or at least credit to me (link to my notes). I took some time just to write this up for all :).
You can go to my notes--->https://www.facebook.com/note.php?note_id=10150198530561927 for sharing :)