There are 4 main factors that control the prefect pricing of a craft. They are :
- Practical Factors
- Psychological Factors
- Creative and Glam Factors
- Competitive factors
Practical Pricing Factors
This is the actual costs and the labor involved in making the product. You have to include all costs in the pricing of your craft, one way or the other.
There are certain costs that are offset in every individual piece. These are costs like cost of the raw material, charges by the artisan, if you are paying some one to make the craft.
Then there are short term costs such as the phone bill, electricity bill, a monthly rentals, monthly wages that need to be divided across the number of crafts that you expect to sell in a month. This amount can be determined over time as you get a better idea of your sales figures. But work with a safe estimate to begin with.
There are certain long term costs that you have to include in the pricing of the product. These costs are adjusted over the period of several months or years. These include expense for assets like machinery, real estate, furniture, office equipment, business loans etc.
A good method to get an idea about these costs is to realise how much you have to offset as installments every month to banks or financial institutions that have lent you the money.
Psychological Factors
It is apparent that you cannot let the practical costs of the product be the only deciding factor while determining the correct price for your craft.
Consider the perceived value of your craft and tried to decide how much by a buyer will be ready to pay for it. The psychology of a buyer is affected by the usefulness and the appeal of the craft.
Remember a cardinal rule of selling. A product sells more and for more if it appeals to the emotional side of the buyer. Not the rational, not the practical but an emotion like nostalgia, desire, happiness, pride etc.
With art and craft it is easy to appeal to this side of a person. You just need to plan for it. You can choose your designs, colors, shapes, materials and even the craft itself to represent a certain mood.
This factor is one of the reasons why vintage items are one of the hottest selling craft items online. They represent nostalgia which is a very strong emotion for mostly everyone.
Glamour and Creativity
The glam factor again has a lot to do with the perceived price of a craft. If your craft is associated with a certain image of glamour, grandeur or hype, then you can price your craft much higher.
Glamour can be crated by focussing on anything special about your craft. For example, the high quality supplies you use. Or the nature of the product such as cases for expensive tablets and phones. These sell for a premium price simply because they are meant for a premium device.
Creativity should never be discounted. A painter doesn’t charge according to the cost of paints and canvas. Wherever, there is creativity and originality involved in your work, account for it in the selling price the best you can.
The Competition
The competition has a lot to do with the perceived cost for your craft. You have look carefully at the competition and their prices. Based on whether your product is the same as them or in any way superior, you can think about setting the right price on your craft. The competition also makes the job much easier for you when it comes to determining the right price..
Pricing a craft product is really not as simple as it may seem. Do give it ample time and consideration. If you view all of the factors listed above jointly, you will be able take much of the guess work out of the pricing determination.
A great article to read is : How To Price Your Crafts Right.
