Pricing an art or craft show product is more of a science than an art. You can’t just set a price that you think is okay and expect to sell a lot of your product for a profit.
First of all you need to know what it costs you to produce your product. You want to include the costs of the goods used to create your product plus a little more to buy extra supplies.
Second you need to include your wages. What price per hour would you like to make? How many hours did it take to create your product?
Third you need to add in the price of your other expenses. Don’t forget to include things like the cost of your studio, electricity, advertising, cost of travel, cost of shows, in this figure. Then spread these costs out over the price of all your products.
NOTE: You will recover a small portion of these miscellaneous costs each time one of your products sell. For example your miscellaneous costs add up to $2000 a year and you sell approximately 1000 products a year that means that you need to add $2 to the price of each product to recover those costs.
In order to make a profit you must build one into your price. At this point adding 1or 2 dollars to your price probably won't hurt sales but...not doing it can hurt your business.
Last and definitely not least you need to know what price the market will support. What this means is that your price can’t be higher than the amount the people who buy your product are willing to pay for it. IF you sell a product that is similar to a retail product you can go to the stores and see what price products like yours are selling for.
Then you need to decide if you can make your product for that price.
Here is a formula to help!
A. Cost of goods used x 1.5 = cost to replace supplies used + costs of new supplies
B. $dollars per hour I would like x #number of hours it took me to create product = my wages
C. Miscellaneous expenses for the year divided by approximate number of products I can sell a year = cost of miscellaneous expenses per product
D. Whatever Profit you would like to receive.
E. Add A + B + C + D=Total wholesale cost of product. This is the price you would receive if you were selling to someone who would resell your item to someone else at a significant markup.
It is not necessarily the price you should charge a retail customer, that price will usually be almost twice your current figure.
F. E x 2=Approximate Total retail price
Compare the answer you got in F to retail prices in the area to know if your price is inline with market expectations.
It may take some adjustment to find the price point that sells the most product at the best profit. Read Are You Pricing Your Original Art Too Low? to know why pricing your crafts too low isn't a good idea.
Here is a link to a simple example of how this works http://www.whatthecraft.com/arts/pricing.htm
Art and Craft Show Expert Shasta McLaughlin provides articles, hints and tips, checklists and more for artists and crafters that sell handcrafted products who want to save time looking for shows, packing for fairs, and get more sales at festivals. Now she is revealing how to collect your customers contact information, follow up with them and make more money while working less. Visit http://www.extravaganzacrafts.com to get her newsletter, The Extravaganza Craft News, that will help you avoid mistakes, save time and money when preparing your craft show booth.