You deserve to be paid for your work. It’s easy to look at something you made and think “I guess I would be willing to pay _____” and end up undercharging for your work. Worth It can help you do the math and give you some guidelines so that you are charging a price that makes you enough money to keep doing what you love and make a living doing it.
Here are a few key things to consider when pricing a product:
The cost of materials should be included in the price of the item. Do you use three and a half skeins of yarn? Six cups of flour? Two yards of fabric? Ten strings of beads? A pound of clay? Worth It lets you enter information for “ingredients” and “recipes” so that you can add up the cost of your ingredients easily.
You should figure out how much you want to be paid per hour, and how much time it takes to make each item. This doesn’t have to be exact, but you should be making a livable wage, and you need to figure out what that means. Worth It can help you do that math.
You need to cover operating expenses. This could be the costs of a website, Etsy or Square fees, storage space, studio space, booth space at events where you sell product, or anything else that you need to pay for to do business. Tracking these expenses, which are more difficult to trace to a single item for sale, is a possible future feature I might be developing for Worth It, but for now, make sure to consider that for my next point.
Your business needs to make a profit. Even if you are selling the results of your hobby to cover its costs, you need to be making a profit that is separate from the hourly wage mentioned above, and more than covers your expenses. Why? Because business is not predictable. You will have unexpected expenses and fluctuating profits, and it’s better to have money available to back your choices than to race to catch up. Because you and your business are worth investing in. Maybe that means taking classes to get better at your craft, classes to get better at business admin, paying someone else to do the business admin so that you have more time to focus on your craft, or even being able to take time off without putting your business out of business. For so many reasons, your business needs to make a profit. You might be thinking that you just want to do what you love without having to spend all your time thinking about how to make money. Think about it this way: Humans need water to survive. They bring it in, cycle it around in their bodies, and send it back out. There are humans in some parts of the world who spend hours every single day walking to the closest place to get water, and then walking back with as much as they can carry. There are humans in some other parts of the world who can turn on a tap in their own home any time of day or night and have water that is safe to drink. Who do you think spends more time thinking about water, and about how water relates to their survival? Businesses bring money in, cycle it around and send it back out, and they need it to survive. If you want to spend less time worrying about money, make sure that your business is profitable, and furthermore that it is profitable without you having to work fourteen hours a day, six days a week, with no vacations. Worth It takes the costs of your wages and materials and your desired profit and does the math to turn that into a price.
The first release of Worth It will stick to basics, but I have so many ideas for the future. If you have any ideas for features you would like to see, please let me know. Here are the most exciting ones:
* Break-even analysis for annual and monthly expenses, such as subscriptions or rent
* Integrating Etsy and/or Square sales to update in Worth It’s inventory automatically
* Tracking sales over time to show trends
* Notifications for low inventory
* Set a timer when creating to get more accurate on how long it takes you to create your product
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