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How to Price Handmade Items

Updated on May 4th, 2024
person using calculator on desk

Calculators at the ready – we’re doing math today. 

If this is a terrifying thought, then you’re not alone, but a big part of running an online store is selecting the right costs. Choosing the right prices can make or break a business, and we’re here to make sure you succeed, because without any profit, it’s bye-bye business!

Luckily, setting your pricing strategy is easier than you’d expect. During this process, keep in mind that it doesn’t hurt to calculate your wholesale costs too.

Preparing and clearly displaying this information instills confidence in your customers, leading to more money in your pocket. Every seller has to go through this process, so don’t worry if it feels a bit daunting, you got this.

So, let’s dive in. 

Top Tips to Price Your Product:

Value Your Product

First things first, as a maker selling products online, the starting point for pricing needs to be on what you’ve already spent. We sometimes don’t even realize how much money goes into producing our handmade creations, and money isn’t the only currency you need to value. The time you spend making homemade items, and the time you spend doing administrative tasks to sell them, are all important parts of the process that factor into your pricing.

Think about it, how many hours do you spend taking photographs and writing product descriptions? We’re hedging our bets here that it’s probably a lot.

As a creator, your time is valuable and your prices should reflect that.

Later in this article, we’ll talk in more detail about the different components that go into pricing your product.

In order to make a profit, you need to figure out how much it would take for you to break even, and then use this as a baseline for your costs. Then add an amount for your working hours anything else you add to the cost depends on where your product sits in the market. With this in mind, move on to our next top tip for the next step!

Research Your Product

Next, ask yourself: “How much are people willing to pay for the same product in other stores?” If we were in a fancy business meeting right now, we’d call it market research, but as we’re all friends here, we’ll keep things simple. It involves comparing prices from different online shops in the same category of your own. It’s possible to hire a professional to do this research, or you can simply do it yourself on a smaller scale.

If you carry out the research yourself, make sure that you gather and catalog the information. 

Perhaps you could create a spreadsheet and commit to filling it in every few months, to see how your products sells during the different seasons of the year. Year on year, you’ll look back at the document and be able to spot certain consumer trends, and work out what time of year you get the most sales.

Another way to gather information, is by posting a poll on Facebook, asking people what they would realistically pay for your product. However, bear in mind that this will only provide an estimate, because what people say they’ll pay is often different to what they actually spend. So, it’s best to use this information as a guide, along with any other research you do.

Compare Your Product

After you’ve researched your product and settled on a price, see how it compares to other online stores that sell similar products. Is your cost lower or higher, or the same? Consider adjusting the price of your product so that it sits just below your competitors prices. This will give you an edge when customers are browsing for the best deals. If you’re a new seller, this is especially important whilst you build your reputation and credibility online. 

One day, you might decide to raise your prices due to high demand and increased awareness of your brand, but we still encourage you to compare your product and its pricing to others. It’s easy to be critical of ourselves when we compare, but please don’t forget that your product should be unique and that’s what will make it sell.

Comparison isn’t meant to make us worry about whether our items will stand out against other products, but it’s to help us lean into what makes our product different and ensure we’re not devaluing it in price.

Market Your Product

It’s easy to feel intimated by the term, marketing. Simply put, we’re talking about a plan to promote your product. This should take into account your target audience, methods of communication, and advertising. This ranges from paid Facebook campaigns, to organic posts on your personal Instagram account.

Is your audience on social media, or would they engage better with email? Perhaps they’d respond best to seeing your product advertised in a magazine? Are you selling a luxury product that is more expensive than the competition, or are you cornering the market at a cheaper price?

If your company’s value is to offer the cheapest prices or the highest quality goods, your strategy has to match. The answers to these questions will frame the marketing of your product, and play a large role in the success or failure of your business. 

Test Your Product

The great thing about pricing is that you can tweak costs as you go without much backlash, especially if you’re early on in your business. When the original plan just isn’t quite working for whatever reason, try another approach, like lowering or raising your prices. Look back at your research and see how things might have changed. Is the audience that you thought your product would attract, really the people who are making a purchase?

Get feedback from friends and family, and most importantly, don’t be discouraged if sales seem slow.

The eb and flow of consumer culture means that there will times when you’re rushed off your feet, other periods where business seems steady, and then times when orders seem quiet. Whatever season you’re in, it’s always a good idea to review your prices and test out new and fresh ideas to grab customer’s attention.

Price Breakdown:


A lot of the time, you’re paying either yourself or someone to do your marketing, branding, and copywriting, for you. If you have to pay someone for the SEO in your titles, descriptions, email newsletters, etc, be sure to factor this into your pricing.


You already know that ads cost money. From Facebook and Instagram, to your website and Google ads, set your budget and then incorporate this magic number into your cost.


Everyone loves a good deal. When you find a great sale, it feels like you’ve beat the competition and won something.

I suggest running a constant sale of at least 10% off items from your store. When sales are run, you not only boost your regular listings, but also create value for your customer, so you’ll want to leave room in your price for these promotional discounts.

The Etsy community also love a holiday sale. If you join in and include your shop in the seasonal promotions, then you will be sure to boost your brand during the busy seasons.


When we talk about supplies, this includes what goes in to creating your product line, as well as everything from packaging, shipping envelopes, and any extra freebies you want include. Don’t forget to pop in your business cards, glue, fliers, thank you cards, etc. These small but personal touches make a huge difference, and is why people buy online.


Pay yourself what you’re worth. The time it takes to create your item from start to finish and the length of time you’ll be listing the item in your online shop. (Product photography, SEO, and descriptions). Not sure what to pay yourself?

Set a timer to see how many hours go into your work, do some research into hourly wages in your industry, and then factor that into your pricing.


For many of us, this can take up a lot of our costs. If you want to rank higher on Etsy, then free shipping is a must, and a lot of people are more likely to make a purchase if it includes free shipping.

Calculating your free shipping is pretty simple when you use Etsy to buy your labels, because there is a little calculator within the listing, which tells you the exact cost of your shipping. 

You can also calculate your Etsy shipping costs here. Prices can change for international shipping, but try your hardest to at least offer free shipping within your own country.

Etsy Fees

Once you’ve been on the selling for a while, you’ll become familiar with the $0.20 listing fee. This can automatically renew after the purchase of your listing or could renew after a few months without sales.

Anytime you add something new, it’s a $0.20 listing fee. The transaction fee is a percentage of your sale, and the current percentage is 5% of everything (listing price, shipping, giftwrap, etc).

There are other subscription fees available if you pay for any add-ons. Etsy Plus, is a premium program that offers special features within the site.

Another option is if you use Etsy to run your website. Pattern seamlessly integrates your inventory within your website, but costs a monthly fee to host your website.

Don’t forget to add these fees into your pricing if you use them, and for more information, we have an entire article devoted to how much it costs to sell on Etsy.


If a seller provides free returns, that actually means paying for the shipping label from the customer’s house to the seller. Sometimes, it’s simpler to just let them keep the product and refund the cost. If you offer free shipping, you do not get that price of the label back if a customer returns their item.


Ensure you’re charging the correct taxes for your products. For many of us, especially creative types, detailed admin can be a stressor. We recommend putting these things into the hands of an accountant, and keeping your focus on creating.

Still having trouble Pricing Handmade Items?

If you’re still struggling to figure out how to price your products, it might be time to hire someone. Perhaps you could find a personal assistant or a marketing specialist to help you.

Prices aren’t a ‘set it and forget it’ type of task. It’s crucial to stay up-to-date with pricing trends and higher fees, so whichever way you choose, make sure it’s a way that works for you.

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