How to Fairly Price Crocheted/Knitted Items

This is a long post that will break down how to fairly price your crocheted/knitted items for selling online, selling at a craft fairs, and selling at consignment shops! I even touch base on shipping.

I started this post in May of 2016… This year I am trying to get to my older drafts, so I can “finish more” as I mentioned in my New Year’s Resolutions post.

Whether you are selling online, at a craft fair/farmer’s market, or consignment shop, I have got you covered!

NOTE: This is a very long post! But I wanted to make sure I covered as much as I could, so grab a cup of coffee or tea, and enjoy!

I am part of several crocheting groups on Facebook, and one thing that just really gets to me is when I see someone post a picture of a finished project, and then ask how much they should charge – WHICH HAPPENS ALL THE TIME. I won’t tell you this is the golden way of pricing your work, but this is how I price mine and what I believe is fair to you, other makers and to your buyers.

I use this process for every item I put up for sale (including jewelry), and then I know that I am getting paid for my time and material cost. Nothing should come out of your pocket when selling items, other than the set up costs. You do have to buy the yarn a head of time and spend the time working the project to list it, but make sure you make up for it in the selling price.

I try to explain this process to all those I come across asking for help on pricing their finished items (on a much smaller scale), and I can’t tell you many times I have received replies of “That’s ridiculous! No one will pay that.” My thoughts, if you don’t think people will pay what it is worth, maybe you should reserve those for fun times, gifting and donating, and work on different projects to sell. Your time and hard work is worth getting paid for.

Depending on where you are selling, the math equation will change slightly, but all the same concept:
time + cost of materials (even if they are from the stash) + associated fees = selling price + shipping (if applicable)

I want to talk about each one a little more in depth, how to handle pricing custom projects, shipping, how to handle pricing a lot of different inventory and why you shouldn’t underprice your work, but first I want to talk about some other ways you may have read or heard about to price your work, AND WHOLESALING.

A. 3x the cost of your materials. Why this doesn’t work – if it costs you $40 in yarn to make a blanket, but takes 20 hours to crochet that blanket. $40 * 3 = $120, or $200 for your time + $40 in materials = $240. That is a difference of $120 in the red!

B. Double the cost plus $1 or * 2.2%. This is very common and useful for calculating physical items you may have purchased elsewhere, like a yarn winder, or crochet hooks if you are reselling them, but not if the item you are selling requires your time.

C. Are you interested in selling your items to another store, say Anthropologie or Modcloth (or similar)? Follow the rest of this post regarding time and materials. Whatever figure you have then, will be the cost you will sell to a wholesaler. If you sell these items to the public, you should double this cost, as this is what those who wholesale purchase from you will do.

Your Time:

Your time is sooooooo important! That is why you mustn’t underestimate it. Don’t just look back and say “well, I guess it took me about 20 minutes to do” because if it really took you 45 minutes, then you are hurting yourself and not giving yourself credit for the time invested.

I use the timer on my phone to time myself all the time when working a project. It may seem tideous, but most of the projects are repetitive so if you time yourself on a couple of rounds, then you can just multiply it throughout. It is important during this period that you don’t stop the clock because you dropped a stitch, or for the few seconds you spend pulling at the yarn so you can keep going and that you don’t speed through it. Crochet like you normally would so you get an accurate time.

I round everything up to the nearest quarter of a minute when working individual rounds, and everything up to the nearest quarter of an hour on a whole project so things don’t get complicated. For example, if it took 4 minutes and 36 seconds, I would say it took me 4.75 minutes (or 4 minutes and 45 seconds) to complete the round. If a whole project took me 12 minutes to complete, I would say it took me 15 minutes. Rounding up to the quarter makes it much easier to do the math later, since there are four quarters in an hour.

It’s also important not to forget the time you spend tying your slip stitch, turning you work, threading your needle and weaving in your ends.

I keep a notebook of my projects where I included my own notes, and my times so I can reference them later, especially if working a similar project.

Real Life Time Example:

I’ll give you an example with true times using my Slanted Shell Baby Beanie in the Newborn Size:

7 minutes (to crochet the crown, which is Rounds 1 – 4) + (2.25 minutes per round of clusters * 8 rounds) + (2 minutes per round of SC * 2 rounds) + (1.25 minutes per weave * 2 weaves) = 7 minutes + 18 minutes + 4 minutes + 2.5 minutes = 31.5 minutes -> 45 minutes

In this example, you can see how I broke everything down and it was very simple to do. I time myself working the crown, one round of clusters, one round of single crochets and working one weaving of the ends, then I just multiple those numbers times how many times they occur. In the end, the newborn sized hat took me 31.5 minutes to complete, and I round that up to the nearest quarter of an hour which is 45 minutes.

*If you are doing a custom piece for someone, before quoting them a price, work up a small sample and time yourself like this! Then use your time to estimate the rest (plus your materials), and quote this price. Do not buy materials or start the actual project until it’s paid for! When I do custom work, I NEVER charge more than I quote even if it takes me a longer to do because I think it’s unfair to them. I just adjust my price for next time, but this is completely up to you.

Rate Per Hour:

Now that you know how long it took you to work up that hat, it’s time to decide how much you want to get paid. I suppose this is something to consider beforehand, but now is when I’d calculate it. When I started out, I “paid myself” $8.00 an hour because I wanted to make my crocheted pieces affordable and be competitive, but the more I worked projects, the more wear I saw that I put on my hands, arms, back, neck, etc and so I decided that it was worth more than just minimum wage.

I now pay myself $10-$12 an hour. Honestly, it’s up to you what you want to make per hour, but under no circumstances should you be making less than the minimum wage in your area. You and your time are worth more!

Using the newborn beanie example, here’s the math figuring in my hourly rate: 45 minutes = 0.75 of an hour * $10 an hour = $7.50

Cost of Materials:

Another thing to consider, materials. How much yarn did you use to complete your project? Did you use any buttons? Or fabric for a lining?

Regardless of whether you are using up materials from your stash or went out and bought them specifically for the project, you need to figure in the cost.

I use Hobby Lobby’s I Love This Yarn for many of my projects for a few reasons, but one of those being that it is very economical. With one 7 ounce skein, you can make practically a million newborn sized hats. Hehe. Well, you can make a bunch for sure. The way I like to think when I am trying to figure out how much yarn I used is in halves and thirds for larger projects. For example, an adult sized beanie would use about 2/3 of a skein. For baby hats it’s harder to gauge because they don’t use much yarn at all. In these cases, I figure in $1.00. I never go any lower than that, and if I use multiple colors in the hat, I figure in $1.00 per yarn color because each skein costs money.

I will say, I do have a small scale that I use to determine how much yarn each project uses based on weight, but I don’t use it for pricing my items, I mostly use it when I am designing patterns or sharing crochet pattern reviews for my blog. Mine came from Amazon, and I think I paid around $13. Totally affordable if you want to go this round, but I think the estimating I do is less work, and still pretty accurate.

Using the same math from above and my yarn cost, here’s the new math:
$7.50 (labor) + $1.00 (yarn) = $8.50

Associated Fees/Sales:

What are associated fees? Are you using Etsy or eBay? Both of these platforms take a small percentage of your sale, plus Etsy charges $0.20 to list each item. Consignment shops also take a percentage, usually 30-50%.

Do you want to run sales in your shop? Like 10% or 20% off? You need to build this into your price so that when you run your sale, you will still make the base amount needed.

Do you want to donate to an organization or fundraiser of some sort? You also need to build this into your price.

Real Life Examples Using the Same Newborn Hat:

A. Selling on Etsy: $8.50 + $0.20 (listing fee) + 5% (fee Etsy takes from sale) = $9.14

B. Selling on eBay: $8.50 + 9% (fee eBay takes from sale) = $9.27

C. Selling a Craft Fair Where You Paid $20 For Spot: $8.50 + $1.00 (or reasonable amount of money to equal what you paid for spot, say you think you will sell 20 items, then $1 is good) + $0.25 (for Shopping Bag if you purchase them) = $9.75

D. Selling at a Consignment Shop That Takes 20% of Sale: $8.50 + 20% = $10.20

You can always add more to these, say $0.50 to items that cost under $10, $1 to items that cost $10-$20, etc. This straight profit guarantees you always have a little something extra. Don’t get greedy though, make it reasonable.

Secret to Pricing a Lot of Different Inventory:

Okay, so there is a little secret to pricing your items if you are selling at a craft fair/farmer’s market/flea market/consignment shop if you have a lot of different inventory, and that is to bulk price similarly.

What does that mean? Let’s say you have already calculated your time and materials and fees, and gotten a cost for 5 different adult sized hats you will be carrying in a variety of colors. Just throwing numbers out there, let’s say the come out to $21 (A), $22.75 (B), $18 (C), $23.50 (D), and $26.25 (E). Now, you could always put these prices on the tag, and call it a day, but you could also bulk price them to make it easier.

Hat’s A, B and D, you could price at a flat $25.00, hat C, you could price at a flat $20, and hat E, you could price at a flat $30. Always higher than your price, never lower, AND close to the original price, not like $10 over. This makes it easier for making up tags and/or entering the information into a computer system (sometimes done with consignment shops) plus they are easy for the customer to see and understand.

Shipping:

This is just a quick little overview for how I choose my shipping costs based on my experiences. You can weigh your item in the packaging you will ship in, then go to USPS.com, plug in the size and weight of your package, and the zip code it is going to, and it will pop up several pricing options. I find this to be a lot of work, and I am pretty good at eyeballing it, so I don’t do this anymore.

I ship from Florida in the US. Prices are from my experience, and current to the time of this post.

I find a lot of small items will ship in a manila envelope for $3.95 ($15 internationally). Items like a hat (or two), a skein of yarn, a pair of fingerless gloves, a clutch…

If it fits in a manila envelope but is a tad bit heavier than the smaller items I mentioned, it usually ships for $4.95 ($16.95 internationally). Usually this is for like an adult size slouch hat, a scarf, two skeins of yarn…

If it heavy, or can’t be bent, or doesn’t fit a manila envelope, my next go-to is a flat rate priority shipping package, which come with $50 insurance.

Flat rate envelopes fit items that would fit in a manila envelope, or things that can’t be bent, like a book, and ship for $7.25 ($24.95 Internationally – has weight restriction).

If it doesn’t fit into the flat rate envelope, I go to the rectangle medium sized flat rate box (there is a smaller, more square one). Usually, I don’t have to go larger than this. I am able to fit lots of items in this size box, and even blankets, after they are strategically folded. Shipping is $14.25 ($34.95? Internationally – has weight restriction).

Priority packaging comes with $50 insurance in case your package is lost. If the cost of your item is more than $50, pay to add more! I have yet to have a package not reach it’s destination, but it’s all about the piece of mind, and i’s really inexpensive to add.

Three Reasons Why You Shouldn’t Underprice Your Work:

1.) Getting burnt out; 2.) Overworking. Both which make you enjoy it less (or quit), and allow for sacrifice in the quality of your work. 3.) You also make it unfair to other makers who are trying to make a living selling finished products.

Real-Life Example Of Underpricing:

I had a customer contact me last year just before the holidays asking for a price on four 60″ x 70″ afghans of a ripple pattern. I sent her a photo showing a baby blanket I had made, and asked if that was what she was looking for. When she replied yes, I got so excited at the thought. I sat down and estimated how long they’d take me to make based on the time it took me to make the baby blanket, and estimated how much yarn I’d use also based on the baby blanket. I explained to her that they would take me about 18 hours each to complete, and that the total price would be $214.50 per blanket plus shipping for a total of $875.50. Realizing how high this number was, I also quoted her on some lapghan sized afghans. She was outraged and replied by “I was paying $65 per blanket with someone else but she shorted one of my blankets and refused to fix it. Won’t be contacting you again”. I responded back with a slightly lower rate figuring in $9.00, apologized for her experience and explained to her that I use my crocheting as a part time job, and can’t make anything less than $9.00 an hour for my time. I explained that it takes a lot of time, effort and hard labor on my body figuring in 18 hours per blanket plus the simple fact that it would cost $45 in materials alone per blanket. If you do the math, the profit is only $20 per blanket. After explaining this to her, she apologized and better understood and we ended on a positive note. I didn’t get the sale, but for $20, I couldn’t have made it work.

After our conversation ended, I did a search for ripple afghans on Etsy to see if anyone was having luck selling them, how often they sold and what they were selling them for. I do this often actually, and take time to read the different reviews because research is important to your business. I ended up finding the shop that this customer ordered from and was sad to see that this shop had received so many negative comments based on what I can only imagine being a result of getting burnt out, and being underpaid.

Moral of this long story and post, fairly price your work and never forget that you and your time are valuable. It also makes it fairer for other shop owners out there trying to earn a living.

Wow! If You’ve Made It This Far, Thank You!! And I Hope You Find This Info Helpful!!

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