Having a handmade shop, my favorite comment of all time is: "You know your products are over priced" - this was some little old lady telling me I was overpricing (at the time $18.00 for a kindle case) my items... which it turns out, I was under-pricing them by at least $5.00 so no.
I also love hearing - "why would I spend so much on this bag, when I can get one kind of similar at Walmart?" - well, why don't you just stick it where the sun don't shine?! Sorry, but seriously - our world is having this amazing return to handmade products and I think that's great, but people need to remember that behind every handmade shop is a shop owner often times struggling to get by because of this "big box store" mentality.
So to explain a few things, I have put together this little blog post to answer a few questions... and with any luck, I will continue to post similar topics about small business adventures including: packaging, social media and getting out there in the real world.
I love the "Pricing Worksheet" in Craft Inc. by Meg Mateo Ilasco.
Using the standard mark-ups provided by Craft, Inc - the Whitney Bag should retail for.... $300+ which is just a tad bit silly. But have no fear, there's a way to work with that...
"...pricing is a balancing act between what an item actually costs and what your market would be willing to pay for it..." (Craft, Inc. pg. 84)
So here's how I calculate my prices so that they are "reasonable"... since I run a 1 person operation, there's no outsourcing I make every product 100% from start to finish from the raw materials. This means I can cut out the labor costs that you would calculate for paid labor, charge myself a base "fee" and still make all the profit for myself (kinda backwards paying myself for the labor)...
*Note that each material price is calculated by the sq. inch.
Okay yes, that's super... but what exactly do these numbers mean? What goes into making a handmade product?
This is a disassembled (or rather, not yet assembled) Whitney Bag.
- Outside of the bag:
- Bottom: 3 separate leather pieces
- 2 pieces of cotton
- Top: 2 pieces of leather
- 2 Straps: 2 leather pieces, 2 cord pieces, 8 rivets, 4 rivet attachment leather pieces
- 1 cross body strap: 1 leather piece, 3 pieces of hardware, 1 canvas piece, 2 rivet attachment leather pieces, 5 rivets, 2 d-ring attachments, 2 d-rings
- Inside of the bag:
- 3 separate cotton pieces (sides and bottom)
- 2 pieces of canvas for top, 2 invisible magnet snaps
- 2 pockets
- 3 pieces of bias tape
- 1 clip
Each piece is measured (I use a set template that I trace right onto the leather for the odd shaped pieces and set measurements for the rest), traced and cut out.
I usually spend an entire day cutting out a mass amount of the raw materials so they are ready to go on assembly day.
The pieces are then sewn, finished and assembled to their respective needs:
Ie: all of the bag linings are assembled, the straps are sewn, the rivet holes are punched, the outsides are assembled...
So that come assembly day I can put the larger pieces together in significantly less time than if I made each bag from start to finish.
And that my friends, is how a handmade product is born and priced.