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Under Valuing Your Handmade Item Is Not Only Bad For You But The Entire Handmade Market

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Friday, July 22, 2011

Under Valuing Your Handmade Item Is Not Only Bad For You But The Entire Handmade Market

My last post was about pricing handmade goods and how to be careful not to overprice or under price as either direction always has a bad outcome.

Having said my peace, I want to talk a little about how I've noticed that a lot of goods in the handmade marketplace are under priced. I make purses and purse patterns and when I puruse the handmade marketplaces on the internet, inevitably I find many, way too many, beautiful handmade purses that took hours and hours to make priced at $20.  Now you can't tell me that after purchasing fabric, notions and interfacing that the person selling that item at $20 is making any money. In fact, they are probably losing money, believe me, I know the price of the materials needed to make a purse.

This type of pricing will kill the handmade marketplace for three reasons:
  1. When an artist spends a lot of time to make an item and under values the time spent making the item, they may sell a lot of items but will soon find that they do not have enough time to fill the need. They end up losing business due to long delivery times. Eventually, they will go out of business because of their long delivery time reputation, go out of business because they are losing money, or grow sick from over work.
  2. Those who price appropriately find it hard to compete with the low prices and go out of business.
  3. Lasty, and not to be overlooked, I suspect that some of the low priced items are not handmade by individuals but produced in factories in far-away lands, this will cause skepticism in the authenticity of the handmade marketplace. Business will be lost by all.
Bottom line, learning to price for the market and letting the marketplace help with your pricing is not only good for your business but good for everyone. When it's right, sales will be made and the entire handmade market will thrive.

How do you think under pricing affects the handmade marketplace as a whole?

Until later ~

Reba

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