Price Any Handmade Item Correctly

The correct handmade pricing formula has four parts: materials (everything that goes into the item), labor (your time × your hourly rate), overhead (packaging, tools, electricity, platform subscription fees amortized per item), and profit margin (the amount above cost that stays in the business for growth, restocking, and reinvestment).

The most commonly skipped part is labor — and it's the biggest one. A crocheted blanket that takes 20 hours to make at $15/hr has $300 in labor alone, before a gram of yarn is purchased. Pricing from materials only produces a loss on every sale. The calculator forces labor to be visible so you can make an informed decision about your pricing.

Overhead is real but invisible. A roll of kraft paper for wrapping, a box of tissue, a set of price tags, the fraction of your crochet hook cost that wears out on this item — add them up and they typically come to $1–5 per item. Small, but real.

Etsy: 6.5% transaction fee + 3% Etsy Payments processing + $0.20 listing fee per item sale. Total roughly 9.5–10% on each sale. Etsy also charges a $10/month subscription for Etsy Plus (optional) and advertising fees if you run Etsy Ads. The calculator covers the per-sale fees automatically.

Amazon Handmade: 15% referral fee with no separate payment processing charge and no listing fee. Simpler math, higher rate. On a $50 item, Etsy takes about $4.95, Amazon Handmade takes $7.50. Amazon's larger buyer base may justify the higher fee for some makers.

Direct / craft fair: No per-item platform fee, but consider booth rent (often $50–300/day) divided by the number of items you expect to sell. A $200 booth with 40 items sold = $5 per item in overhead. The calculator lets you add this to the overhead field manually.