How to Price Your Etsy Products Profitably
The number one reason new Etsy shops go out of business is underpricing. Between the 20-cent listing fees, the 6.5% transaction fees, and shipping costs, handmade sellers often realize they are working for minimum wage. Use the ToolBizz Free Etsy Pricing Calculator to mathematically guarantee your shop is generating actual profit.
Paying Yourself for Your Labor
When making handmade crafts, jewelry, or digital downloads, you must factor your hourly time directly into the Cost of Goods Sold (COGS). Never work for free to keep prices low. If it takes 2 hours to knit a scarf, input 2.0 in the Labor Hours field and multiply it by a respectable hourly wage using our Salary to Hourly Converter.
Wholesale vs. Retail Etsy Pricing
If you plan to eventually sell your Etsy goods wholesale to local boutiques, you need massive margins. A typical wholesale buyer wants a 50% discount. Therefore, your retail Etsy target margin should often be 60-70%. If you ever need to calculate a temporary sale price, use our Discount Calculator to ensure you aren't losing money on the promotion.
Frequently Asked Questions (FAQ)
Yes. Because Etsy takes roughly 9.5% + $0.25 (plus listing fees), you should conservatively add 10-12% to your materials cost before calculating your final profit margin.
Stop using messy notebooks. When you buy yarn, beads, or shipping mailers, immediately log the cost into our Business Expense Tracker so you have accurate numbers come tax season.