How to Price What You Make
Add materials, your labour at a rate you would accept and overhead, multiply by two for a first price, then check what that price leaves after fees, postage and discounts. In the worked example the ×2 price leaves about 22% of what the customer paid, not 50%.
Almost every underpriced handmade product is underpriced the same way. Not by guessing badly — by leaving one line out of the arithmetic, always the same line, and then wondering why a busy month produced no money.
The line is your time.
The method below works for any craft. For crochet, candles, jewelry and soap, Craft Business works it through from each craft's own costs.
The rule of thumb, which is not the interesting part
(Materials + Labour + Overhead) × 2 = your price
You can find that in a hundred places. It is a sane starting point rather than an answer — there is a section below on what it quietly assumes — and reading it changes nothing anyway, because the difficulty was never the multiplication. It is that three of those four terms are hard to look at honestly.
Here is what each one actually contains.
Before the detail: the pricing checks are free by email, one short email each, with a one-page summary to print.
Materials means everything the customer takes away
The vinyl, obviously. Also the transfer tape, the blank, the thread, the glue, the backing card, the cello bag, the sticker that seals it, the box, and the label.
And then waste. Every cut leaves offcuts and every batch has a failure. Fifteen per cent is a reasonable placeholder until you have measured your own, and measuring it is a weekend of writing down what you binned.
Cost per item, not per roll. This is the arithmetic in reverse and it is why a 30cm offcut feels free when it is not: divide what the roll cost by how many finished items the roll actually yields, spacing included. Three millimetres between shapes across a full mat is more material than it sounds.
Labour means all of it, at a real rate
Not "the twenty minutes it took to press". All of it:
- designing the file, or adapting the one you bought
- machine time you cannot walk away from
- weeding, which everybody forgets and which is the longest part (for decals it is most of the price, which is why pricing them by the square foot undercharges small ones)
- pressing, assembly, quality-checking the ones that failed
- photographing, listing, writing the description
- answering three messages about postage
- packing, and the trip to the post office
Then multiply by an hourly rate you would accept from an employer. Not a "getting started" rate. If you would not take £8 an hour from a stranger, do not take it from yourself — a business that only works while you are underpaid is not a business yet, it is a subsidy you are paying.
This is the line people leave out, and leaving it out does not make you cheaper. It makes you unpaid.
Overhead means the costs that exist whether or not you sell
Machine, blades, mats, the software subscription, the font licence, the listing fees, the payment fees, the domain, the packaging you buy in bulk.
Add the monthly total, divide by the number of items you actually sell in a month. Not the number you hope to. If you sell thirty things and your fixed costs are £90, that is £3 on every item before you have touched a material.
Most people discover here that they are running at a loss on their cheapest product line and subsidising it with the expensive one.
Why multiply by two
The multiplier is the part that sounds like greed and is not. It covers:
- the order that arrives damaged and gets remade at your cost
- the customer who wants three changes
- the twenty enquiries that never buy
- the listing that sat unsold for a year and eventually sold at a discount
- tax
- and, eventually, profit — the thing that is left after you have been paid for your time, which is a different thing from your wage
At ×1 there is no allowance above the costs you included. At ×2 there is an allowance, but no guarantee it covers your fees, discounts, remakes or other costs. Check those separately before treating the remainder as profit.
What ×2 assumes, and where it stops being true
Doubling your cost is a markup. It leaves half the retail price above cost — and every fee, every postage cost you absorb and every discount comes out of that half, not out of the other one. That is the gap between what the rule of thumb looks like it gives you and what actually lands.
A worked example, and the numbers in it are assumptions rather than anybody's real fee schedule:
- Cost per item: materials £2.50, labour £2.50, overhead £1.00 → £6.00
- ×2 → list at £12.00
- Assume a 10% discount → customer pays £10.80
- Assume a selling fee of 6.5% of that discounted payment, plus a 20p listing fee → £0.902, rounded to £0.90
- Assume postage costs you £1.50 and the customer pays no extra shipping
- Remainder: £10.80 − £6.00 − £0.90 − £1.50 = £2.40
That is about 22.2% of the £10.80 the customer paid, not 50%. The £6 cost here excludes the selling fees and postage shown separately, so neither is counted twice. These are invented example fees, not any platform's current schedule. Tax and further costs are excluded from this illustration; the £2.40 is not take-home profit. Your provider's fee base and rounding may differ.
So use ×2 to get a first price, then check what that price leaves once your own fees, postage and discounts come off it. The rule of thumb does not do that second step, and the second step is where prices are actually wrong.
Wholesale is not "the price minus a bit"
If a shop asks for wholesale, the convention is half your retail price, and the arithmetic only works if your retail price was right to begin with.
Which is the real reason to get this correct even if you only sell direct: a retail price built on unpaid labour cannot be halved. If somebody offers you a wholesale order and the maths collapses, the wholesale order is not the problem.
To check an offer before you answer it, the free consignment and wholesale calculator takes one batch of one product and shows what a shop's terms would leave you.
The craft-fair adjustment
A stall has costs a listing does not: the pitch fee, the fuel, the day itself. Add the pitch fee divided by the number of items you realistically sell that day, and count the whole day as labour, not just the making.
The honest version of a craft fair is often that it pays for itself and buys you a mailing list. That is a legitimate reason to do one. "It made money" is usually not the reason, and the sheet will tell you which you had.
When the number frightens you
It usually will, the first time. Three responses, in order of how often they are right:
- Check the labour line. If the number is absurd, it is almost always because the item takes far longer than you believed. That is worth knowing: the answer may be to change the product, not the price.
- Change what you make, not what you charge. Some products cannot carry a fair price. Discovering that is the sheet doing its job.
- Charge it anyway. People underestimate how much of their competition is also underpriced and quietly exiting. Being the one who is still trading in two years is worth more than being the cheapest this month.
What you should not do is drop your rate. That is the one adjustment that feels like a business decision and is not.
The thing this does not cover
Whether you are allowed to sell it at all. Pricing a mug you cannot legally put that font on is an expensive way to be organised — four questions settle almost every real case, and they are worth asking before the order, not after.
Common questions
Why multiply by two?
The multiplier covers remakes, changes, enquiries that never buy, slow listings, tax and eventually profit; at ×2 there is an allowance, but no guarantee it covers your fees, discounts or remakes.
How much should wholesale be?
The convention is half your retail price, and that only works if the retail price was right to begin with.
What if the price frightens me?
Check the labour line first, then consider changing what you make, then charge it anyway. Do not drop your rate.
The Maker's Pricing Workbook does the second step, which is the one the ×2 skips. It runs the other way round: batch costs with labour and overhead rows, divided by the units you can actually sell, then fees, shipping and discounts taken off, against a target margin on receipts you set yourself — with a status line that says when the price you chose misses it. Margin and markup are different arithmetic and the guide spends a page on the difference. It will not tell you what to charge. $9.99. For the stall itself, the Market Day Record Kit records stock, payments and the closing cash count, so you can see which of the two craft fairs you had. $3.99.
Selling through shops? The Wholesale & Consignment Kit includes the workbook and the Market Day Record Kit, and adds fourteen pages for consignment: what each shop actually leaves you after commission and fees, the terms to agree in writing, and a monthly check of the shop's report against your own count.