Pricing a product is a sensitive issue, especially when it involves artwork or a craft, such as handmade cards. You need to consider not only the time and costs involved in making the cards, but also the price the market will bear. Standard formulas can help you determine a price for your handmade cards that is fair to you as the artist and appropriate for the retailer and consumer.
- Skill level:
Keep track of all expenses. Even if you are working from home producing your cards, account for advertising, materials, utilities, gas, phone, Internet and the building space that you use.
Determine the amount of time you spend producing cards, and set an hourly rate to pay yourself. Never settle for less than minimum wage.
Calculate the labour cost per piece. Divide the total minutes it takes you to complete one card by 60, and multiply the result by the hourly pay rate you have set.
Calculate the cost of materials and overhead (Internet, travel, space, etc.) for each card by dividing the total cost of all of these things for a set time period by the number of cards that will be produced in this time. This will give you a cost per piece that it takes to produce each card.
Add the numbers from steps three and four together. This is the total cost for each card just to produce it. This will be your wholesale price, which is the price you offer to retailers to purchase your cards. Retailers will mark up your wholesale price by 50 per cent in order to make a profit on your cards. If you are selling your items personally, mark up your wholesale price to the standard retail price that you have determined.
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