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Pricing as a Maker + **A Free Pricing Tool**

A lot goes into pricing. It is one of the most important details in whether a product is successful or not. Price functions as a conversation with the customer. Once they decide they like an item, they check the price, then decide if they want to move forward with a purchase. Too high and the customer might walk away, too low and the effort creating that product might not be sustainable.


Price is a particularly vulnerable decision for makers running a side hustle. A lot of makers start out as hobbyists, so when it comes to selling their products, they aren’t sure what their product is worth.


To help makers address that challenge I have made a simple tool which will help establish a starting place. It is linked at the bottom of this post, so if you want to skip right there, feel free. If you want a little more detail, continue reading.


Here is what goes into it:


Materials

Materials should include physical items or expenses that go into creating a product. Don’t be shy accounting for your costs–this has a huge impact on what you end up taking home after a sale.


Time

When you love the work you do, it can be easy to forget that your time is a critical and limited resource. Time should reflect the active working time required to create your products.


Hourly Rate:

If you do not have an idea of what your hourly rate should be, consider what you would expect to be paid per hour at another job.


Quantity:

If you make your product in batches, this feature allows you to establish the sale price by item. If you make one at a time, that is fine too!


Margin Percent:

The margin % will determine how much of your sale price you take home as your profit. If you are not sure where to start, try 30% and see if the recommended sale price seems reasonable.


Sale Price:

The main attraction. The price will reflect a combination of the cost of materials and what you will earn from profit.


Profit Calculator:

This tells you what you can expect to take home in a dollar value. It summarizes by item and by batch.


The final step is tweaking inputs. Use steps 5 & 7 (hourly rate & margin %) to adjust up or down. Playing around with the inputs is a great way to find a sale price you are confident in.


The below link will create your personal copy of the tool.


Feel free to reach out to Becca@AuroraSmallBusiness.com for any questions, feedback or support.


Happy Pricing!


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