Pricing Your Handmade Products can be challenging and overwhelming. Too high and your product doesn't sell. Too low and you don't make any money. We’re going to break it down to help you figure out the best pricing for your products and market.

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Developing Your Product Line

• - Research, experiment, learn what is profitable and do it well!
• - Products sell based on presentation & value
• - Draw inspiration from other industries
• - Be different - do what your competition doesn’t do!
• - Have products in different price levels - $5, $10, $20, etc.
• - Don’t try to be the cheapest - you are selling handmade products

Pricing Strategies

• #1 Rule - Charge as much as you possibly can without losing sales
• Minimum Retail Price = cost x 3
• Minimum Wholesale Price = cost x 2

Calculating Your Costs

• - Direct Cost = cost for products used in production (ingredients, packaging, etc)
• - Indirect Cost = rent, electricity, heat, equipment
• - What is your time worth? (hourly rate)
• - Profit = Selling price less direct costs

Planning Production for Profits

• Let’s use a candle for example
• Candle A Cost is $4.62 to make
• - Retail Price = $13.99 (cost x 3) - $4.62 (cost) = $9.37 profit
• - Wholesale Price = $9.25 (cost x 2) - $4.62 = 4.63 profit

When Standard Pricing Models Don’t Work

• - Products that have low direct costs for materials (votives, tealights, tapers, etc.)
• - Products that have very high direct costs for materials (super large candles, speciality vessels, etc.)
• Learn to work backwards & forwards on pricing
• - Backwards - Desired Selling Price less direct cost = profit
• - Forward - Direct Costs x (markup x2, x3, etc) = profit

Bottom line there is no right or wrong answer with pricing as long as you are covering your costs and paying yourself! If you are in a luxury market, the sky may be the limit! If you are in a more low income market, make sure to cover your costs and your time then get them hooked on your products so they become a loyal customer! Having different price points in any market is beneficial and could create a customer that may have been priced out otherwise.