How to Price your Handmade Items, on Sale Online?
Deciding the right price for products on sale, could be difficult, and is often considered an hard rock on the path to online sales. Whether choosing widely-known products’ prices seems easier, it’s equally true that making a decision on handmade product, often made by our hands, it’s much more complicated.
To start, remember that prices are not steady or something already established. Materials’ cost, experience, market’s demand and competitors are all causes that influence the price, and when they change the price changes with them.
On internet, you’ll find many different formulas, that help you calculate the right price for each item. The one I found easiest and ready to use is this one:
Probably now many of you have started, roughly and quickly, comparing the possible results of the formula, to the actual prices of their shop. Results could be very different from the prices you’re applying right now, both in one side or another but, as I already told you, remember that many elements affect the price, considering also brand popularity, experience, times in business, etc. You probably have already heard somebody saying “paying for the brand instead of paying for the single product”!
At this point, I suggest you a bit of self-business-analysis to better understand at which step, in the path to professionalism, you are: are you already there? Do you think of yourself as an hobbyist? Maybe you’re just trying to get a little extra, together with paying for the expenses. Wherever you are, we can give you a couple of suggestions, to help you being objective about your business, as much as you can:
– show your products to somebody who is not familiar with your business, or even better, someone far from your typical buyer persona: an outsider! Then ask them how much they would be willing to spend for something similar.
– look at your shop as you never saw it before. Pretend you’re not the person who created everything, and put yourself in a customer’s shoes. Do you like what you see? How much would you be willing to pay for it? Do you consider what you see a work made by a professionist or something made by an hobbyist?
Together with a simple calculation you have to consider lots of aspects so, before you change every single price of your shop, with the magica formula aforementioned, you should ask yourself:
– how much is the market willing to pay
– how is your product/shop is perceived in the market (cheap, professional, average, luxury, etc.).
– which prices are your competitors applaying (on products with similar style, quality, market targeting, etc.)
– if the product has been already sold or demanded
– prices too low – Look back at your shop in a stranger’s shoes: would you buy an item on sale for a way too low price? Probably not: so why are you trying to sell a 2 euro/dollars bracelet? Just mix five of them in a single package, and offer it for 10 euro/dollars.
- shipping expenses – Remember that everybody hates shipping expenses: even more, if their costs is higher than the item’s price itself! Keep shipping expenses very low and cut them off on small prices’ items.
– analize what has worked, repeat it, and change whatever has not brought good results: here some data might be useful
– listen to your customers, feedbacks are one of the most powerful tool you have in the difficult field of customer satisfaction: use them collecting both opinions and criticisms
- find materials at a lower cost, yet keeping the same quality, it’s a great way to reduce final price: do some research