Even if you’re not going to sell wholesale, account for it It’s the norm and expectation with seasoned retailers and brick and mortar shops. Most pricing formulas would advise on a 2 times markup from wholesale to retail pricing, but I’m suggesting you use at least a 2.2 times markup because this will appear more attractive to your wholesale prospects. You can set your markup to more than 2 times if you want, as long as your market can bear the higher prices! Profit is the money you spend on growing and investing in your business, such as with: But don’t confuse this with money you pay yourself with! Your markup is where your profit fits in the picture. The beads and findings for the earrings cost $0.85. Your time spent to make these earrings cost $5 ($20 divide by 4). Say it takes 15 minutes for you to make a pair of earrings and your hourly wage is $20. Item Cost x Markup (between 2.0 – 2.5 or more) = Wholesale Priceīonus: Click here to download my FREE and easy plug-and-play pricing calculator to figure out what to price your items under a minute without any math! Pricing is serious stuff, and deserves your attention if you want to build a sustainable business for the long haul.įortunately, there’s an easy way to figure out all of this math (and it’s not terribly hard either!) You might get a sale every now and then and make big bucks, but the thought of when you’ll get your next sale scares you because your handmade items are not priced accessibly in your market. Yes, you do need to have more money to make more of it. You’ll forever be in that cycle of creating, selling, creating, selling, but never breaking out of it to create more and sell more because you don’t have enough money for more. Not to mention the perception you allow your customers to have about your products and brand: cheap, poor quality, low value, bargain buy, unmemorable. You risk running a loss because you don’t have enough money to pay for your marketing. You won’t make enough money to stay in business. Here’s what I mean: When your prices are too low… It’s also what makes or breaks your business. Pricing handmade has been a discussion among artisans for the longest time.
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