Find out about pricing crafts. Selling homemade crafts can be a rewarding home business opportunity. You can achieve good profit margins when you create your own crafts and sell them. If you are creative and enterprising and able to produce your homemade craft without large expenses there is virtually no limit to the handcrafted products you can sell successfully.
What do I need to know about pricing crafts?
Selling crafts comes down to a simple philosophy – the price of the finished product has to cover all the expenses that went into making it plus leave you with a healthy profit. Obviously you want to make a profit but you also want to make your price attractive to buyers. No matter how wonderful your crafts are setting the wrong price may leave you with piles of unsold stock. Your pricing objective is to make a product at a price low enough to appeal to buyers and high enough to cover all your costs, including your labor, and make a decent profit.
Most craftspeople err on the side of under pricing their work. This is because they undervalue their own labor and expertise. In fact a unique handmade item is a real value item and should be priced accordingly. Check what similar handmade goods are selling for and price your product competitively. Under pricing may mean a quicker sale but it results in low profits and a perception that your product is “cheap” and of inferior value. No crafts business is sustainable under these conditions
Another common pitfall is over spending on supplies before really establishing your market. Watch your costs very closely and be disciplined about only buying the supplies you really need. It is easy to be seduced into buying all sorts of attractive materials that are not necessary, especially when you first start a home craft business.
Closely monitor your overhead expenses such as utilities, internet fees, travel expenses, marketing and packaging costs. Always include a percentage of these costs into the price of your finished product in order to remain profitable.
Will I make money from home crafts?
Before you start making your crafts note down all the expenses, add the profit you expect to make and ask yourself – will the price still be attractive for the buyers? The best way to find the answer to this question is to research the prices for similar products. Visit online markets such as eBay and online handmade craft stores or go to local craft stores and retail outlets to find out what these products are actually selling for. You need to have some idea of your target market and how much they are ready to spend on the items you want to make. This research will tell you whether the type of crafts you plan to sell will make you money.
Do I need to keep proper records?
If you plan to turn your craft making hobby into a successful home business you will need to understand the basics of bookkeeping and maintain proper records. Proper records and bookkeeping are important for sustaining and expanding your home crafts business. It will tell you exactly how profitable your business is and provide you with the information you need to make business decisions such as buying additional equipment or starting a new product line.
The purpose of keeping records is to help you properly manage your crafts business and to enable you to pay any taxes etc that are required. As long as it achieves this your bookkeeping should be very simple. There are a number of affordable accounting software packages for small businesses or you could purchase bookkeeping forms from your local stationery store and do it manually.
What will make my craft sell?
Give your craft a unique or special twist on a mass produced commodity to make it original and desirable. Buyers search for products that are slightly different from those readily available in retail stores. Also make sure you produce a quality product. Consumers expect value for money. You control the quality of your handmade product so ensure your workmanship is up to scratch.
Properly pricing crafts so that they sell well is key to success. You can enjoy all the benefits of a thriving handmade crafts business if you commit time and effort to the financial management aspect of your business as well as the creative production of your beautiful crafts. Find out more about a successful home crafts business at Work at Home Crafts
Julia Derby has many years experience working in small business development and has successfully started and developed a number of home businesses. Her free website http://www.my-home-business-ideas.com provides good ideas and practical advice for people who want to start a home based business.