Pricing handmade jewelry seems to one topic that jewelry artists never agree on. There are lots of different viewpoints and philosophies. This article will discuss some of the things to think about as you consider how to price your jewelry, and some of the common pricing models that jewelry designers use.
Keep in mind that you do much more than make jewelry as a business owner. In order to cover costs and overhead it is essential to charge more than your hourly rate + material costs, or keep your hourly rate on the high side (i.e. $18/ hour is much more realistic than $10/ hour) if you want your business to be profitable.
One mistake that new jewelry designers often make is to price their work too low.
Here are a few pricing tips:
-Don’t compete with imports on pricing! Your quality is better, and you can never compete with those that make $2 a day. Instead, position yourself as the high quality artisan that you are, and command reasonable prices.
-As a newcomer, you can start lower if you would like, and move your pricing up as you become more well-known.
-Lower pricing also can work against you because it cheapens the perceived value of your work. People tend to think that you get what you pay for, so if you charge too low, people tend to think you make garbage.
I have another reason for not charging too low. This is kind of my personal soapbox:
If you charge too low, you are not only cheapening the perceived value of your own work, you are also cheapening the work of others because the public learns to think that some artisans who charge what they are worth, are charging too much.
Those artisans that charge what they are worth then have to work so much harder to convince customers that their work is worth the cost.
That said, as a jewelry designer, you need to consider 2 types of pricing: wholesale and retail.
Wholesale and Retail Pricing Models
Common wholesale pricing models used by jewelry designers:
-3 x the material cost
-3.5 x the material cost
-$18/hour-labor plus 1x materials plus 50% (or whatever you want your hourly wage to be)
-Eyeballing i.e. guessing at what it should be worth (not recommended, but common)
-$35/hour-labor plus 1x materials
-$26/hour-labor plus 1x materials plus 50%
-$20/hr.labor + mat. + 5%overhead + 20%profit
Common retail pricing models used by jewelry designers:
-1.4 x wholesale
-1.5 x wholesale
-1.6 x wholesale
-1.7 x wholesale
-1.8 x wholesale
-1.9 x wholesale
-2.0 x wholesale
-The ever common but not recommended “eyeballing” method
Feel free to use any of the wholesale or retail pricing formulas to price your own work.