Sunday, January 25, 2009

The Cost of Handmade

(Please take one moment to think of a dollar amount you would pay for the pencil case pictured above. Ok, you may now continue reading!)

I have had this blog title in my head for months. Handmade is really catching on. I can't remember people valuing handmade more than now. I think the whole Local movement has helped tremendously and I have to say I have browsed the Local Etsy feature more than once to see what people are creating in my neck of the woods.

I have a question for you. If you are currently creating handmade items, what was the reason you started? My reason is simple. I am cheap and I like the challenge of learning new skills. But I really dislike to label myself and my handmade items as cheap. Maybe I should use the term "frugal" or"thrifty".

Take this pencil case for example. The linen had a previous life as a garment. The cotton print was free to me. The zipper, well, I found this one locally for $.10. Not much in the way of material investment right? But how long did it take me to make? How much is my time worth? And if I had to recreate this and had to buy new linen and cotton can I charge a different price per handmade pouch? Should I figure all my material expenses at new material costs?

I timed how long this took me from start to finish. I started this pouch at 12:45 pm on a Saturday afternoon. I cut all the fabric. I pieced the front and back exterior panels. All seams were top-stitched. I even changed the color of the thread once to add a bit of contrast stitching on the linen. I took the extra time to add fabric bits to the ends of the zipper so the pouch had near 90 degree corners. There are a few lost minutes in there when I tried to find my little crochet needle that I use to turn corners, but when it was all said and done the clock on the wall said 1:35pm. Ladies and gentlemen that is 50 minutes. ((pause)) Is that too long? Is it fast?

I was reviewing the time investment with my husband and I expressed frustration is how slow I was. If sewing pouches was my full time job, how could I ever make a living? (Not that I am looking to make sewing a full time job or anything. I just wanted to clarify that.) He responded that making a zipper pouch in under an hour should be a very satisfied crafty project. Hmmm. Maybe so.

Fast or slow, I just used 50 minutes of my life to sew this little pencil case. How much is that worth to you? Should I figure out my hourly wage for my salary job since I have B.S. degree? I proposed this question to the hubby and he said I couldn't use my degree salary as a basis to determine the value of my time since I didn't use my degree education to make this purse. Hurumph! Does anyone have any comments on this statement? I sure did, but I eventually decided to use minimum wage for purposes of this Handmade Experiement. (Even though the local gas station is hiring at over $10/hr.)

Minimum wage for PA as of July 2009 is proposed to be $7.25/hr. 50 min equates to $6.01.

The cost of the raw thrifted materials is a very modest $.45. My time is apparently worth $6.01 at minimum wage. Total cost is $6.46.

Now consider if I had to pay "new" prices for the materials.
Comprable zippers cost $1.69 at JoAnns.
Cotton fabric (designer) is usually around $8.95 (includes shipping).
Linen costs vary greatly but a 40% coupon at JoAnns will get your 100% linen for around $10/yd.

You'll have to excuse me for not showing my work, but if I have used new materials my cost would be around $2.74. (Keep in mind that I did not interface this case since the linen was already interfaced from the garment construction and the cotton was a deco weight fabric.)

And then the business books say to add on markup, which is your profit. I've seen books that say you should raise your prices 50-100% per item. But it all depends on how much profit you need.

So how much would you pay for the zipper pouch above? I would love to hear your thoughts on this topic. Do you have any advise to share when it comes to pricing your handmade items?


  1. It is quite a conundrum. I think you can only charge as much as people are willing to pay, but I have no idea how much that would be.
    I do remember Kathy (pinkchalkstudio) doing a series of posts on pricing handmade items once though.

  2. See, the problem I find with handmade is that because of the time spent making it, items are usually way more expensive. I do some handmade things, I buy some handmade things. But, its super hard for me to buy something handmade, and support the fellow indie artist, when its clear that they have jacked up the price just because its "handmade". I mean yes, by all means, a profit is deserved, but sometimes people seem to take advantage. I personally wouldnt pay over $10 for the pencil case, even though its really cute, but someone else might be willing to pay double that! I guess it kind of just depends on the person and what kind of means they have.

  3. The question for me usually comes down to quality. I will gladly pay more money for something that is high quality than something that is lower quality but maybe less expensive. I've been at the point where cheap things are appealing, but at this point in my life I'm tired of being surrounded by breakable, cheaply made stuff. For a bag like that, although it's not something I would buy just because I don't really have a need for it, I would concievably pay $20.

  4. I think about this issue all the time. I mostly make quits so I'm straight up not gonna make a profit (when you consider time) unless I charge a price I personally couldn't afford...

    I would easily spend $15 on a pencil case, and if I were in love with it (and not feeling broke) $20... I wouldn't be surprised to see it priced at $20 by the way. That's living in Los Angeles where things are probably a bit more pricey than other parts of the country...

  5. I've been having the same issues myself. It's really hard for me to find the right price- one that people will be willing to pay (myself included) and one that covers materials and my time well enough that I don't feel as if I'm cheating myself. I think that was a really bad, confusing run on sentence. Sorry.

    Anyway, you should be proud of yourself on the 50 minutes. I'm not sure how long it takes me to make one (I rarely complete anything in one sitting), but I think you could kick my butt.

  6. I have the same dilemma! I want to price my items low enough that they will sell but then I think of the TIME I spent and I think, is it really worth it? Am I making or losing money in the long run? Good question -- sorry I don't have a good answer! :)

  7. $12-15. That's how much I would pay if I wanted the item. And most things you make I *do* want, by the way. But I don't need most things I want and I'm like you. Cheap. So I make what I want for myself. This is the problem.

    I'm not my customer and people like me aren't either.

    But...for someone who doesn't like to sew and wants a nice gift, a special treat, or something made with quality materials and heart, your time is worth $10.

    That's what I've decided for myself. If I can't make at least 10$ an hour, I should probably stick to sewing for myself and for gifts and let others sew for a living. I don't always have the guts to price my items this way, yet. But I'm getting there.

    Thank you for raising this question and for us to think about and discuss. And thank you also for constantly inspiring me with your beautiful work.

  8. I feel your pain. I sell knitted items on Etsy, and often refer to myself as a one woman sweat shop. Yarn (good yarn) is super expensive, and knitting is quite time consuming. But how can I sell a newborn baby sweater for more than $30? I barely spend that on my own clothing. Lately I've been backing off of adding to my shop for this very reason. I think the only way around it is to work in bulk...but then things start to feel mass produced and not handmade. of luck to you! (Oh, and I'd be willing to spend about $15 on the pencil case.)

  9. First off, the pouch is lovely. Simple with great attention to detail.
    I'm not going to be much of a help when it comes to pricing handmade items, as I'm totally at a loss for a proper method myself. I factor in supplies sand time, but there are other element that can't be itemized: the care, attention, and creativity that are bound to the finished object.
    It's probably not the right way to go, but I find myself basing price mostly on what I think customers will pay, not on all that goes into my handmade pieces.

  10. I'll start right off by saying that sadly I have nothing additional to contribute to the discussion I share the dilemma with you, the quilter & the knitter (except with crochet, I HATE unnatural fibers) If you price things true to materials & time spent...well I wouldn't buy my own stuff. BUT Let me say this is super cute. I love the things you create

  11. Don't forget the value of your creativitiy and the time spent to learn this skill. After all, the uniqueness (and cuteness!) of the pouch is what makes it valuable! Pricing is such a hard issue--I always feel like I'm ripping myself off and the other person feels like I'm ripping them off when I sell something I've made. I'm glad you brought this up!

  12. Well said, kayla! That's the problem... Do I rip myself off so that the customer buys, or do I price fairly and turn off the customer?

  13. hi there! well, i got a B.F.A. in fine arts, my concentration was in functional ceramics and we discussed this very topic all the time. The final conclusion we all agreed upon is that an artist or crafts person should never base their prices on hours/time into the piece. It will only break your heart to see how little money your time is worth. It SHOULD be worth more, but in our world today sadly usually it`s not. but i love the cute pencil case and i would pay like between 18-25$ for it!

  14. I don't have answers unfortunately but I love that you brought it up. I struggle with the same idea. I sell purse patterns. The reason I don't sell the purses themselves is that I couldn't make any money.

  15. Oh yes...this is such a good question! I think that we all struggle with this one.

    So often you see those formulas about paying for materials, paying for your time, and then doubling it--well, sadly, that only seems to work for art or jewelry--I don't think that would be feasible for sewn/knit/crochet items. People just won't pay that much for it.

    What I generally do is price things at what I think the market will bear, and decide if it's worth my time or not at that price. Some things are, some not. See, aren't I helpful! lol

    I do try and not be too cheap..we really do need to train the consumer that handmade quality is not cheap.

    BTW, I would pay around $12-15 for a beautiful handmade pouch like yours.

    Smiles, Karen

  16. Ugh. These are all thoughts I've had many times. It's so hard! You have to also think about gas and time it takes to get to the post office, stand in line, and pay for shipping. The heavier the item, the worse it can become of course . . .
    I have wanted to purchase items from Etsy/Ebay (anywhere really) and often decided not to, because of the shipping addition. Even if the asking S?H price is completely reasonable, it makes the overall price so much sometimes.
    I think at a point of just starting out, it makes sense that some sellers make anywhere from 30%-50% tops. As you are more known, become a better and more experienced crafter and get more sales, it's okay to ask for more sometimes. Someone is willing to purchase. Ask for less: Get more sales. Ask for more: Get less sales. Sometimes in the end, you make the same amount.
    I always want to be fair! But, I also need to think hard about how much each thing really costs and then factor that time in. From the very start of purchasing things to make it, to standing in line and shipping it away.
    If it starts to be more of a stress than something enjoyable, I say raise your prices and let it go if you rarely sell. Otherwise, enjoy yourself and make a bit.
    I'd imagine corporations generally price their things evenly to the customer. Like, I can make two pieces, one costing say $4.35 and the other $6.25 for me to make (guessing here somewhat) and generally ask a similar amount. So sometimes it's a little profit and other times it's a lot more. Evens out in the mix? Hmm..
    I could go on for hours.. Something for us to talk about. :)

  17. I guess. That's what I do... I look at my stuff and think "What would I pay?" and then I realize that I'm frugal and wouldn't pay for it because I'd make it instead. This is a crazy good topic.

  18. This is the whole reason why I have started and stopped two different times to have my own Etsy shop. I figured I would be breaking even, if I was lucky. I still havn't given up the idea, I think it comes down to what you are selling. I love this little pouch but would not pay over $10 for it, but before Christmas this year I bought myself a $75 dollar purse on Etsy. I think you need a few items in the under $20 range but those cannot be your bread and butter. You make a good point also in that being thrifty when buying materials is a huge benefit to your price point. Its difficult to buy all "new" materials add in time and sell something at a profit. Besides I think that is a lot of the appeal and charm of handmade, many materials are re-purposed, "vintage", or recycled and yes I would totally charge the same as if they were new as long as the quality was there.

  19. This is a really thought provoking blog post.

    I would pay $10-$15 for the pouch.

    It can be tough to price handmade items.

    I find that in my own shop, I have a mix of things that I just enjoy making, that are time consuming and maybe I'm not making a huge profit on, and then there are items that I can sew quickly and make a better profit on, while keeping the price reasonable.

    I've found that making more than one of the same item at a time is one trick that saves time. Your sewing machine is already threaded with the correct color, you can cut fabric all in one go...etc.

    You have to make your items unique in some way, in order to charge more than the average seller. Whether it's your talent for mixing fabrics or colors or adding your own artistic touch.

  20. I don't think that you should "charge" minimum wage for your creative time, unless you feel that artists should only be paid minimum wage. I don't.

    I think that artists deserve a fair price for their time and talents. I do think that those prices should not reflect a degree program UNLESS that degree program helped them somehow in their product design, construction or in the management of their crafty business.

    You also have to add in the time it takes to photograph your item, the time it takes to list your item, listing fees, design time (how did you know THAT is what you wanted to make? that time is part of the creative process).

    For a pencil holder like that - made from designer cotton & linen, I would pay between $15-$25 depending on if the designer was well known or not and if I had proof that their work was quality (not saying yours isn't.... just that it would come into play when determining the price for an item I would buy). If the artist weren't well known or reputable (not a lot of etsy feedback, etc), I would probably pay more on the lower end until I knew them. If I had purchased from them once and seen the level of quality was good, I would be willing to pay more in the future.

    (also - if it did not have linen, I would pay between $10-15, because as a crafter I know the cost difference. Not everyone would know that, I think).

    As a crafter you have a responsibility to yourself and to your customers to provide a fair price that honors your time and talents, but that still makes your work accessible.

    Hang in there -you do beautiful work. :)


  21. Handmade items aren't always of good quality, and to critique your own handiwork, well, is hard. I believe the best bet is to mark it at about the same price as others that you find comparible minus about $5 so it'll sell.
    I am so glad to see women and men delving into their creative sides, however, that means more competition!
    I would realistically pay about 12-15 $$ for your very cute pencil case...where's your tag? Whenever I see a handmade tag I'll pay a little more (not the made in China one).
    -nice to meet you-
    Anne Marie

  22. There is never a way to recoup your time when doing handmade and even figuring minimum wage (which is 8.75 here in CA) doesn't quite cut it. Soemone once told me to ask what I needed to earn but that somehow doesn't work. I think the best way I've found is to check what other folks are asking for similar goods and to go somewhere in the middle there. Your work is of such high quality that you could ask top dollar.

  23. I think that solid, good handmade is better than bought. It counters sweatshop policies of most major companies. You make something 'made in the USA', as I make something 'made in Europe' and that should tell any person living in these countries, what your time is worth (or mine), for one.
    This whole 'handmade' movement is nice, but it'll only work if it pays. Or else we can swap, that's lovely, too, if you ask me.
    But if we sell and buy, and if we apply real market laws, your pouch would probably cost around 20 Dollars (you need to think about it, make it, photograph it, sell it, ship it). If your customers want to continue buying great items you made, they need to pay the real price of handmade. It means that no poor chinese woman is producing one hundred identical pouches each day.
    So there you go. I'm probably militant, but I do think that we're not used to pay the 'real' price for anything. In Europe, even flour or milk are a lot cheaper than their real cost because of government subventions.

  24. ps: I meant 'bought' in big shops like Walmart or The Gap, or whatever else trademark.

  25. your pouch is lovely! (and it gives me a great idea of what to use my fabric for now-thank you!) 50 minutes is quick for construction least i think so.

    it's interesting to read the discussion about pricing items. (it makes me glad that i don't have a shop to maintain and thus avoiding this dilemma.) if i weren't a quilter, i know there is no way i would be able to spend the money on quilts handmade by others. i guess in the back of my mind i always knew that, so that gave me the drive to learn to do it myself.


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