When it comes to pricing handcrafted crochet items, there are several schools of thought as well as a really cool app that can help you out when it comes to pricing. In this post I’ll discuss 3 of the most common manual pricing methods, talk about the Crafts Calculator, and at the very end of this post I’ll also explain how I price my crochet gift items.
One of the hardest things any crafter has to do is determine how much they will charge for a handcrafted item that they make and intend to sell; I’m no different!
Let me start by saying that making handcrafted crochet items IS a business and like any business the person making the items has legitimate business expenses. For example, here are just a a few of the expenses that I incur, even if I don’t sell anything:
- Monthly web hosting fees to keep this site up and running
- An Annual Report Fee to the State of Vermont
- Subscriptions to Crochet magazines
- The retail price of the materials that I purchase that make up the final item
- Cost of individual patterns
- Boxes and packing materials
- PayPal fees when I do sell an item
And then of course, there is my time. The time I spend actually making the item, researching/finding patterns, ordering yarn, as well as the time that I spend creating a website.
Making any handcrafted item is a manufacturing process – you have a plan, design or pattern, you purchase raw materials – the yarn, and then you manufacture (create or make) the item. Unlike commercial manufacturer’s who have costly machines that effectively mimic the look of a handmade item; as a crocheter my machines or tools if you will, consist solely of a a hook and my own two hands!
Here are three different schools of thought on pricing handcrafted items:
Time + Materials = Cost
Cost times 2 = Wholesale price
Wholesale price times 2 = Retail price
Method 2 is more complicated and involves setting a dollar value based on each yard of yarn used in the project in addition to the actual cost of the yarn itself. Here’s an example:
Simple project = time is based on $.10 per yard of material used.
Complex project = time is based on $.20 per yard of material used.
So, for example – you’ve completed a scarf. The cost of the yarn was $23.00 PLUS total yards used (380 yds. @ $.10) 38.00 = $61.00 sales price
Cost of materials times 3 (materials, time, profit) = sales price
There’s an App that can help you determine your pricing:
There is also a very handy little app, called the Crafts Calculator – available for both Android and iPad/iPhone. With the Crafts calculator you enter the cost of your materials, the number of hours that you spend making the finished item, choose your skill level and select a profit margin and it does all the math and suggests a sale price. It will also calculate fees if you sell your items via Etsy or Handmake Me.
How I price my handcrafted crochet items:
Let’s just say that at this point, I really don’t have a firm handle for pricing my final items and for right now I’m just sort of winging it. Let’s take a look at the Road Trip Scarf as an example, and I’ll look at each of the pricing methods as well as the suggested price using the Crafts Calculator:
Here’s the details:
- each skein of yarn retails for $6.99
- each skein contains 279 yards
- I used 1 1/2 skeins ($10.485/ 418.5 yards)
- Time to make = 10 hours
- Method 1 – I didn’t even bother using this method because I haven’t been able to put a dollar value per hour on my time
- Method 2 – $10.48 + (418.5 x $.10) 41.85 = $52.33
- Method 3 – $31.455
- The Crafts Calculator provided a sale price of $66.00
So now I have 3 different prices; a high, a low, and a middle of the road. Here is how I calculated my sale price of $49.00:
- $66.00 (high price) MINUS $32.00 (low price round up) = $34.00
- $34.00 divided by 2 = $17.00
- $32.00 PLUS $17.00 = $49.00
Now let’s convert that to an hourly value for my time:
- $49.00 PLUS $10.00 (shipping) = $59.00 MINUS $15.48 (cost of materials) MINUS $2.01 (PayPal fees) = $41.41 DIVIDED by 10 = $4.14 per hour.
Needless to say at $4.14 per hour I’ll never get rich LOL, but I certainly will enjoy myself!