Pricing for Time-Consuming Creations

If you know anyone who makes beadwoven creations, or have tried it yourself, you know that it takes FOREVER. Even after years and years of practice and the development of some seriously mad beading skills, most of my pieces still take me several hours from start to finish. Even the simpler pieces take me at least 1 to 2 hours each.

Other time consuming crafters (this post isn’t exclusively for beadweavers) can also relate. When it takes multiple hours to finish a project, following most handmade pricing formulas is daunting. Take this very simple, and often used handmade pricing formula:

(time x $per hour) + 2(cost of materials) = wholesale price

wholesale price x 2 = retail price

The retail price is what you charge in your online shop, at craft fairs, etc. The wholesale price is what you offer boutiques and shops so that they can re-sell your items at full retail price for a profit. It is recommended that, depending on your level of skill, you give yourself at least $20 an hours for your labor.

While this formula works all fine and good for one of my quick projects, for example, a glasses lanyard that takes me 20 minutes to make, it gets tricky when using it for one of my more time consuming projects, such as a cuff bracelet that took me 4 hours. (I’m totally making up my supply costs here, so just bear with me.)

Glasses Lanyard:
(0.333 x 20) + 2(3) = $12.67 <- wholesale price
12.67 x 2 = $25.33 <- retail price

While over $25 feels a bit high for me still, it’s a reasonable price and I could live with it.

Now let’s try it with the bracelet cuff…
(4 x 20) +2(6) = $92 <- wholesale price
92 x 2 = $184 <- retail price

Okay. Let’s take a moment to process this. According to one of the most conservative handmade pricing formulas out there, I should be getting close to two-hundred buckaroos for one of my beaded bracelets. TWO HUNDRED DOLLARS.

I would LOVE to actually sell my pieces for that much, but let’s be honest here. I’m not working with solid gold or silver, I’m not incorporating diamonds or rubies, my items are made up of mostly glass seed beads. Who is REALLY going to pay me that much for a new accessory. I’m simply not targeting the affluent, upper-class fashionista audience that apparently I should be. While my customers are happy to support handmade, and are willing to pay a bit more for a unique piece of jewelry that they won’t be able to find anywhere else, I have a hard time imagining that they would be willing to pay anything more than $80 for a bracelet like this, and even that’s pushing it with most of them.

So what’s a time-consuming crafter to do? How can we continue to create the unique, labor-intensive items we love, be able to actually SELL them, and make enough money off of our sales to consider our model a realistic business venture? Here are a few solutions from yours truly, a time-consuming crafter who does not charge for her time, but still manages to make money selling handmade… (Totally just referenced myself in the third person. Do I get an award for douche-baggery now?)

Figure out ways to speed up the process.
For me personally, this means prepping several projects that utilize the same supplies at once. This can also mean making multiples of the same project, one right after another. You’ll have all of your necessary supplies out and ready, and the repetitiveness of creating the same thing over and over again will result in better timing for each one.

Mix your time-consuming projects with non-time-consuming ones.
Just as in the glasses lanyard example above, I buffer my Etsy shops and craft fair booths with plenty of “filler” pieces that take much less time to make, but ensure I have a full inventory. Some of these simple items take me less than five minutes to create, and I can easily make several at one time. As a result, these projects often make up for any profit-loss that the most time-consuming projects take-up regarding labor spent.

Optimize what you sell.
What else can you sell besides your finished handmade pieces? Can you make and sell patterns of your original designs? Maybe you can sell left-over supplies as destash lots, or get paid to teach a class in your art form. If there are other ways in which you can supplement your income from selling, it never hurts to explore those options.

Keep all of your costs in mind.
When coming up with prices for your items, don’t forget that your costs aren’t all included in your labor and materials. Remember shipping charges, packaging materials, craft booth fees, Etsy and PayPal fees, time spent photographing and writing descriptions for your items, marketing time and costs, and so on. Even if you are like me, and planning on ignoring the results of the basic pricing formulas for handmade, you still need to make sure you are covering all of your bases.

Consider your target market.
If you are targeting geek-item-loving college students, chances are, they don’t have a whole lot of cash to spare and you need to do your best to keep your costs down so you can charge less for your items. However, if you are targeting an older, more well-to-do audience, you may be able to splurge on some high-end supplies and charge a bit more for your creations.

Consider the tangible nature of your product.
Some items can command a higher price simple because of what they are. Others have much lower expectations, due to the very nature of the item. For example, everyone expects a T-shirt to be a basic, low-priced piece of clothing. Even if you were to spend hours and hours hand-embroidering a design onto one, most people would still balk if you commanded anything higher than $30 as the final price. However, those same people would probably expect a wedding dress to be a much higher-priced item, and often come prepared for that when shopping around for one. If the previous hand-embroidery had been completed on a vintage wedding dress, even if it initially cost you the same as the blank T-shirt, you could command ten-times the asking price, and no one would question it.

Whenever you start to get caught up in calculating your labor time, your supply costs, your marketing tactics, etc., it doesn’t hurt to take a step back and consider what your item actually is. A t-shirt. A necklace. A scarf. You can cover a toilet seat with Swarovski crystals, but it’s still just a toilet seat. If you REALLY want to push the limit of what customers expect to pay for your product (like Starbucks did, for example), then you need to preprepared to work on some serious branding efforts to change people’s mind-sets.

How high is your craft-barrier?
Your craft barrier is the design and creation skills you possess and use to make your items. Basically: how many other people can make what you make, or easily learn how to? If the answer is anyone who can shop at Micheal’s, then you won’t be able to charge very much for your items. If you price too high, people will simply get their goods from someone else selling the same thing for less, or they will figure out how simple it would be to make it themselves. If you have a low craft barrier, you won’t be able to make much of a profit in order to compete.

On the other hand, if you have a high craft barrier, you get to command a higher price. The more skills and experience required to master your craft, the more people can expect to pay for it. Before slapping a price on your goodies, keep in mind how many others are already making what you make, and if they are at the same level of skill as you or not. If the number is small, you have good reason to ask for more.

What did I miss? Please share your tips for pricing time-consuming items in the comments below. I love hearing from you!


Tagged: , , , , , , , , ,

42 thoughts on “Pricing for Time-Consuming Creations

  1. Heather October 17, 2012 at 7:26 am Reply

    Great post! Pricing isn’t so cut and dry like many think it is. In my own shop I charge two different labor rates in my prices. My vintage style jewelry that isn’t wire wrapped is priced with a lower labor rate because it doesn’t require a special skill set to create, even though it is still unique. My wire wrapping techniques took many a trial and error and lots of time invested in working with it so it commands a higher labor rate and people expect that. Same for my painted scrabble pendants. They may be $20 while you can buy others at $10 but mine are not paper glued to a wood tile. They are painted with teeney tiny brushes and years and years of painting experience. Since they’re so small, they don’t take long to make and I don’t have to charge more for a more detailed design vs a simpler one.

    • MegansBeadedDesigns October 17, 2012 at 8:10 am Reply

      Excellent example Heather. Of course your unique, HAND-PAINTED pendants should command a higher price than those simply using printed digital images (of which they can print an infinite amount of.) People are paying for the one-of-a-kind nature of your handmade product. Essentially, a work of art they get to wear.

      Thank you for sharing!

  2. Edi October 17, 2012 at 7:26 am Reply

    Great post Megan! I’m much like you and make a mix of labor-intensive items as well as quick, low cost items. I use the quick items to cover my time on my more timely items. My Name Albums take about 4 hours, but I know I could never charge $200 for one. The formula is a nice starting point, but it doesn’t work too well for handmade items.
    I also consider the perceived value (like you mentioned with the wedding dress vs. tshirt). It’s amazing how you can take an item and call it something else and demand more money for it :)

    • MegansBeadedDesigns October 17, 2012 at 8:12 am Reply

      Exactly Edi, Bridal items are especially good at commanding a higher price. I’ve seen an example where a store charged 3 times as much for the same dress, but in white instead of their red, prom dress version. Crazy!

  3. Between The Weeds: LRStudio October 17, 2012 at 7:51 am Reply

    You have shown a new light on the oh so written about pricing issue. Love what Heather said about painting with tiny brushes, those are very expensive by the way, and being a painter I get it. Some work is labor intensive but is it not a part of branding? to get why you charge the price and that is why it is worth the price for this must have piece? One thought is also add into your pricing some exceptional work at the higher well worth the price pieces for clients to compare and maybe you will see you need to speak to those people more.
    By the way Megan your work is true art and exceptional. I honestly can see someone buying your bracelet for $200. I see the value of wearable artwork. Beautiful spectacular amazing.

    • MegansBeadedDesigns October 17, 2012 at 8:15 am Reply

      Thank you so much for your comment and kind compliments, LR. I appreciate it!

      Like you said, price can have a lot to do with branding. It is absolutely possible to charge more for something that people usually expect to pay less for, you just have to be ready on the back end to convince them as to why they should.

      Having a higher price can be good for your overall brand image, as long as your marketing tactics, photography, etc. all match up with that image.

  4. Between The Weeds: LRStudio October 17, 2012 at 7:53 am Reply

    Reblogged this on The Painted Cottage Home and commented:
    Think about pricing your work well here is a formula that might help.

  5. The Craft Frog October 17, 2012 at 9:32 am Reply

    This is a great post! This is what fiber artists deal with too- if it takes me half an hour to finish one apple, well… No one is going to pay $40 for one apple. Would you mind if I linked this to my pricing post?

  6. twistedpixelstudio October 17, 2012 at 9:45 am Reply

    I also struggle with this. My photos sometimes take hours and hours of time. I have some that have gone through my process of “twisting” over a hundred times. Using the accepted price cost method would price my photos out of this world, especially considering the sizes offered. I am better at pricing my assemblage/mixed media. Those I can price accordingly and do so. Thanks for a great post about how to go about it all.

    • MegansBeadedDesigns October 17, 2012 at 9:55 am Reply

      Thanks for your comment twisted. At least, by the nature of your product, you can sell multiples of the same photo (feel free to correct me if I’m wrong.) Which means you don’t necessarily need to net your entire cost by selling one, but you can accrue it over time, after several copies have been sold.

      This is how I determine the price of my beading patterns. While one may take me a few hours to make, when I price them I keep in mind the ideal of several of the same pattern being sold, so I can price on the lower-end.

  7. madamesaslow October 17, 2012 at 9:55 am Reply

    I usually explain it to people in terms of hand knit socks. I can’t sell those. I can make them, but it takes HOURS and HOURS and no one would pay that much for them. They’re just socks.
    Some people can’t charge enough to make money on what they sell. They want to move from the hobby world to the business world, but they are going to have to make some changes if they want to make money.

    • MegansBeadedDesigns October 17, 2012 at 9:59 am Reply

      That’s a perfect example Adriann. It’s interesting to consider that a pair of socks would have a hard time demanding the same price as a pair of gloves, even if they take the same amount of time. Some items are simply hard-wired into our minds as “low-cost” and it’s difficult to try to change their perception.

  8. Beth McCormack October 17, 2012 at 10:56 am Reply

    Wow! Such a helpful post. THank you!

  9. Cindy Breninger, Deerwood Creek Gifts October 17, 2012 at 11:00 am Reply

    Great post – very informative. I work with logs and concrete. It is not very hard, but a lot of people don’t have the tools or want to do it. I raised my prices once and my sales went up! I price mine to what I would pay for something similar.

    • MegansBeadedDesigns October 17, 2012 at 11:19 am Reply

      That’s great Cindy! If you have demand (sales) and they continue with your price increases, then you have made the right decision! Good luck with your future sales!

  10. I’ve Got the Flu! | The Craft Frog October 17, 2012 at 11:45 am Reply

    […] post on ideas around pricing time-intensive things and how to make it work. You can see it here. Share this:TwitterFacebookLike this:LikeBe the first to like this. This entry was posted in […]

  11. Selling Handmade: Pricing | The Craft Frog October 17, 2012 at 11:50 am Reply

    […] Megan has some excellent suggestions on how to price around time-intensive items, read them here! Share this:TwitterFacebookLike this:LikeOne blogger likes this. This entry was posted in Selling […]

  12. Queso Monkeys October 17, 2012 at 1:47 pm Reply

    The only other thing I would say is that people may have to accept that there are certain labor-intensive crafts that they’ll probably never be able to earn a living making. Well-made quilts, for example, will probably only ever be a hobby, and a labor of love for most people, because the labor involved far exceeds what anyone would ever actually pay for. If you spend 30 hours piecing together a beautiful quilt, you’re probably not going to find a buyer to pay a $1200+ retail price for that, and you’ll be lucky to even get a $600+ wholesale price. You’ll make back your materials (plus some extra for more materials), and you’ll do it for the love of doing it.

    But, that doesn’t mean crafting as a profession can’t work for that person. It just means that they’ll need to use their skills to do something else that can provide a living wage. For example, the quilter with a facility for sewing can make handbags and gadget cases at a proper hourly rate to pay the bills, and work on their quilts as an extracurricular activity (where getting paid something for them is just a really great bonus).

    Of course, the funny thing is, this usually ends up resulting in me making my most expensive and impressive stuff as gifts and give-aways, because I love making them, but can’t really justify making them to sell!

    • MegansBeadedDesigns October 17, 2012 at 2:08 pm Reply

      An excellent point pants. If you love doing something that is hard to turn a profit on, optimize other things you can make with your skill (such a gadget cases) that WILL allow you a profit.

      Sometimes, this big, expensive piece never sells, but you make it because you love it. However, keep in mind that these pieces also make for great price-comparison models.

      Think about online store that often place similar products next to each other, one priced MUCH higher than the other. The site doesn’t expect to sell the higher-priced item, it’s really there to make the lower one look like a better deal.

      Following this example, it may be smart to hang onto one quilt – per your example- to display in one’s online store and at craft booths not for the intention of actually selling it, but for the purposes of making everything else look like a steal.

      • Queso Monkeys October 17, 2012 at 2:22 pm Reply

        Not only does it make everything else look like a steal, it also lets people see that your skill level is quite high, which makes them feel as if they’re buying items from a skilled artisan rather than a home crafter. WE know that those aren’t mutually exclusive categories, but a lot of shoppers don’t perceive it that way, and they place more of a premium on buying art than they do on buying something they perceive as equivalent to “old church lady crafts.” Not that there’s anything wrong with old church ladies or knit toilet paper cozies, of course! But it’s a different market, and putting your highly-skilled, expensive stuff out there helps you compete in that higher priced market.

  13. Sarah (Saturday Sequins) October 17, 2012 at 2:01 pm Reply

    This is one of the best posts on pricing I’ve ever read, Megan! I’m going to link to it the next time I do one of my Rainy Day Links posts — it’s the perfect partner to another post a friend did on pricing.

    The only thing I’d add is that in addition to selling patterns, tutorials and small e-books might also be a way to go. Especially if you have some skills and techniques other people don’t, or better ways of approaching old techniques. Cyndi Lavin of Beading Arts has some great, inexpensive e-books on bead embroidery, and she’s taken the medium to some awesome and unexpected places. :)

    • MegansBeadedDesigns October 17, 2012 at 2:10 pm Reply

      Thank you so much Sarah! And yes, tutorials and e-books provide yet another avenue us time-consuming crafters can collect an additional income.

  14. PencilJen October 17, 2012 at 2:02 pm Reply

    The way I see it, if you have a few spectacular items that people love, but can’t afford, offering them a taste of your work at a lower price point is really smart.
    The beautiful expensive stuff to draw them in, and the lower price points to send them away with something to remind them of your big work.

    • MegansBeadedDesigns October 17, 2012 at 2:11 pm Reply

      I agree with this 100% Jen! Having items at multiple price points not only makes you more accessible to customers at differing income levels, but it also provides you with comparison-pricing. If you have elaborate, high-priced items next you your regular, mid-level priced items, they look like bargain deals in comparison!

  15. Angela October 17, 2012 at 10:16 pm Reply

    Very interesting blog Megan. I agree with PencilJen. Adding lower price items with high priced items could help your sales. It attracts customers attention. Some will buy the lower priced item and some the higher priced item once it’s not over $100.00. Sometimes they try to bargain if they purchase more than one item. This happens when selling jewelry in person at shows.

    • MegansBeadedDesigns October 18, 2012 at 8:17 am Reply

      Ah, yes. I get those bargainers too. Especially in my local area, people’s price points are very low.

      Sometimes it helps to do the bargaining for them… like have “Buy 3 get 1 Free” deals. People tend to haggle with you less if they already feel like they are getting a steal.

  16. wishingwellstudio October 18, 2012 at 8:02 am Reply

    This was such a clear comprehensible article.Where Do you get the time and focus to write full blogs and make the Family Jewels too?

  17. TinyTes October 18, 2012 at 8:17 am Reply

    This is a great post, thank you for it! Some great insight from the comments here as well. I love your ideas of easier to make filler products, also, selling patterns, tutorials & such is a great idea too! After the holidays I will be adding some new lines to my shop, and you’ve given me lots of ideas to work on, thanks! :)

  18. Lisa October 20, 2012 at 11:37 am Reply

    Thank you so much! I do bead weaving too and I mix it up with stringing so that I have a balance. Sometimes I’m worried that I am competing with myself, meaning people will forgo the expensive items BECAUSE I have lower priced items. It looks like from this article and conversation that is an unfounded worry.

  19. martabrysha October 20, 2012 at 3:16 pm Reply

    I wish I had some “quick” artworks to sell. My embroidered artworks take anywhere from 150 hours to 400 hours to complete. Until attitudes towards my preferred medium change and I build up a reputation I have no hope of charging anything like an hourly rate.

    It is clear that you are exceptionally skilled as a bead weaver and I think you have a sound business head on your shoulders. I wish you every success.

    • MegansBeadedDesigns October 20, 2012 at 3:27 pm Reply

      Thank you marta! You work is spectacular, it’s great to get a compliment from you!

  20. Marsha October 24, 2012 at 10:27 am Reply

    I think part of the problem with sellling hand-crafted work is the ridiculously low-priced similar items imported from other places where people make pennies per hour for their labor. Of course, buyers who want that mass-produced, many-of-a-kind stuff can shop at Target and own it. But when we underprice our one-of-a-kind work, we become part of the problem. Either it’s worth what is cost to make, photograph, describe, package, ship, and provide a percentage to the selling venue, or not. And if not, then it’s a hobby, not a way to make money. You would have to love random stranger buyers a great deal, to give them gifts of your time and materials, I think. I know it’s possible to be paid for what you do. You just have to find the right market and buyer, assuming your design and technical skills are up to the task. But for most people, the reality is, selling hand-made work is not way to make a living. For some, selling pays for the hobby. That seems a reasonable outcome to me. Good post.

  21. Alan Tolfrey October 24, 2012 at 5:10 pm Reply

    Your insights and those of all other hard working Crafters ( or should I say Grafters?) are both honest, inspirational and accurate. Can I add some views from me and my business over in Great Britain?
    They’re principally just the same, except for the currency!
    Oh and perhaps, to get the bad feeling out of the way early on, that we also have those “crafters” who’s work isn’t 100% original by any means, turning up at all levels of so called “Craft Fairs” with people who sit behind their tables, doing very little to interract with visitors – even seen people reading newspapers!
    I’m told I make something that people have never seen done before _ happens a lot – and not “bragging” as I know there will be others somewhere.
    I make models of people’s houses, shops, bars, hotels – whatever – on a pure commission basis. I also transform individual group and house photographs into 3D pictures. So every order I do is bespoke and made to order.
    I’ve done this as a business for nearly 3 years now – about 40 years as more of a hobby.
    So there’s a difference to a certain extent, in that I set a price with the customer before I start work – or would like to. But invariably, any “project” I start changes as it progresses. So any estimate is very likely to run out of steam as people add this and change that and “could you just” and “that would be nice if you could” – oh and the favourite “we’re going to add a porch on the front of the house, can you show that too?
    So how do I handle it?
    I now quote prices “from”. And agree with the client that the scope of – as I call it – the project – can and will change as we work through it. so I try and involve clients from the start.
    Is it working? yes it is – well more times than it fails!
    But I’m always open to ideas! And I hope you don’t mind me adding my experiences here too?

  22. bluedotjewelry October 24, 2012 at 6:27 pm Reply

    Hi Megan,

    I don’t have much new to add to the thoughtful voices here in the comments, but I want to thank you for outlining so clearly an issue that just hadn’t quite made sense to me. I don’t think pricing is a science, and the tidy formula, suggested by Etsy and elsewhere, just doesn’t seem to work across the board. I’m still trying to work this out myself, but I feel like approaching the challenge with realistic perspective is the most likely path to success — and with the least amount of stress. I applaud you for tackling this issue!


  23. Sue Martin (@WelcombeGlass) October 26, 2012 at 1:34 am Reply

    Thanks very much for your great blog on pricing . Sue

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: