How to Price your Handmade Jewelry? Use the Jewelry Pricing Calculator
When I first started selling my handmade jewelry I just didn’t have a clue about how much I should charge for it. I felt bad for charging too much but I couldn’t just give it away for free. So during my first months of selling my handmade jewelry I just doubled the price of my materials and added a few dollars. I was winging it. Then one day I found a jewelry pricing calculator (also called jewelry pricing formula) on line and, all of the sudden, everything made sense! Then I found a different one, so I played with both until I got the one I was comfortable with. This is what I recommend:
When you price your jewelry you should take into account these variables:
- Overhead expenses
Choosing your Supplies
Always try to get your supplies from wholesale or at bulk discounts. I learned the hard way (don’t we all?) and now I only visit my local bead store to check if they have some awesome gemstones. They do tend to get some amazing and unique ones, so I don’t mind paying a bit more for those. But for the rest of my supplies like wire and more regular stones I get them either through Fire Mountain Gems or at my local wholesale bead store Cherry Tree Beads. Sometimes a regular bead shop will have an artist discount or something similar, so check with them.
Choosing your Labor Costs
Now it is time to determine how much your time is worth to you. If you want to be successful at selling your jewelry you need to pay yourself a salary. I give myself $25 per hour. This amount is totally up to you and it will change as you get more experience or develop new skills. Do not sell yourself short. Being an artist doesn’t mean we can’t have a decent wage.
Calculate your Overhead Costs
Overhead is also going to be different from one artist to another. There are so many different things related to your jewelry business that we can’t forget to add them here. For example, do you pay rent on your studio? Do you need to add travel costs? You also need to add here things like office supplies, materials (lamps, tools), taxes. The overhead costs are normally added as a 10% in your jewelry formula. This 10% will be the funds used to cover all that, so if you think your expenses can’t be covered try to increase the percentage.
Jewelry Formula Calculator
Now that all the variables are clear it is time to use the formula:
Price of piece= (materials cost including packaging x 4) + your hourly rate
then add the overhead (10%) to the total
NOTE: Some people multiplies the materials costs (including packaging) by 2 or by 3, not by 4. Use what makes sense in your circumstances.
Let’s see how this works on an example:
You made a piece in 30 minutes. The materials cost you $7. Your packaging costs $1. Your hourly rate is $25.
1) calculate your materials + packaging and multiply the result by 4
$7 + $1 (packaging)= $8
8 x 4 = $32
2) Your hourly rate for half an hour
If your hourly rate is $25 and this piece took you only half an hour, then your rate for this piece is $12.5
3) Add the materials to your labor rate
Materials ($32) + labor rate $12.5 = $44.5
4) Calculate your overhead for this piece
Overhead would be 10% of $44.5 = $4.5 ($4.4 rounded up to 4.5)
5) Add the materials and labor rate to your overhead
Total per piece = $44.5 + $4.5 = $49
What if my Piece is Unique?
Yes, what if you made a piece with a unique stone that you won’t be able to find anywhere else? Then it is time to rethink your pricing. Adjust it to reflect the uniqueness of your piece.
If you are considering selling wholesale, you have to take into account that this price will be about 50% of your base price. So for the piece above, you would sell this for $24.5. While it may seem too cheap, selling wholesale is just another world. Once you delivered your order to the shop, your job is done, you don’t have to deal with customer, or to sit at a booth for days (include here traveling to and other booth expenses). Selling wholesale is a smart business decision, not only it will save you time, but it will give you some marketing power. Your pieces and your brand will get some priceless exposure!
I hope this article and the jewelry pricing calculator helped you decide how much you should charge for your handmade jewelry!