We took a little look around and I found myself standing face to face with these...
Yeah, that's the right price on that little sucker... $10 USD. There were three or four different designs and all were rather shabby -- cheap materials, you could see the stuffing through the stitches, etc. I couldn't see one of these things lasting more than six months for even the most gentle recipient.
So, the rant. I'm still a little singed from an Etsy blog post last week that suggested we use the following formula for pricing our work:
Cost Price (Labor + Materials Cost) x 2 = Your Wholesale Price
Wholesale Price x 2 = Retail Price
Let's do the math from Etsy with one of my Fuzzy Whazzits.
- Labor: 1.5 hours @ $7.25/hr = $10.875 ($7.25/hr is US minimum wage)
- Materials: $1.25 (roughly)
( 10.875 + 1.25 ) x 2 = $24.25
$24.25!? And that's WHOLESALE! Yeah. Right. Like I could EVER get $24 for a Fuzzy Whazzit.
I'm lucky if I can get $7.00 each for the little guys. I tried raising the price to $9.00 at one point -- even added in fun stuff like a little care manual and stickers -- and people balked. I sold almost none of them.
So now I see these key chains at Macy's (retail) and they're $10. My stuff is surely better made than those key chains, so I will be interested to see how many are left in the bin at the end of the holiday season.
In the mean time, I just don't know what to think about my pricing. My biggest show of the year is in less than one week. Etsy tells me to charge more than anyone in their right mind is willing to pay. Macy's is charging more than I thought reasonable for way less quality, and I'm busting my fingers for, well... let's do the reverse math...
( X + 1.25 ) x 2 = $7.00
X = $2.25 = Labor