Pricing your work:
The big question is how to price your work. The way I do it is to have the pattern in hand. Then start a stopwatch, get the wood, keep track of supplies used, apply the pattern, drill, cut, sand, and finish, then stop the stopwatch. Now I have a time that it took to complete this project. And I can figure the materials I have used and their cost. My time is figured at a per minute rate, so we multiply the minutes times the labor cost and add the material cost for a selling price.
Don't forget to figure your fixed expenses into the labor cost. If your heat, electric, rent, insurance, phone and overhead cost you $300 a month , figure 160 hours of work an average ( 4-40 hour weeks ) and dividing that out makes it about $1.88 per hour to pay overhead, so add that to your wage. You may have more or less overhead depending on the setup of your business.
To figure a per minute rate I started by keeping the time and material cost figured out. Then looking at the finished piece, thinking it should sell for ($20). Take that $20, subtract material cost and what is left is your labor cost. Divide the labor cost by the minutes used to do the piece and you have a per minute rate. After figuring selling prices on different pieces, you will find a good average rate to charge. In the beginning I didn't do this and found that some items sold so well that all my time was spent keeping up on them. After figuring the price this way on those items I discovered that those taking all my time weren't paying much. I was working for a lower labor rate on some items and higher on others. And you can bet that customers figured out real fast those that were under priced. Why spend time making items for $8 per hour when items making you $12 per hour sell too, but you don't have the time to make many of the $12 items because the demand for the $8 items keeps you too busy. In time you will learn to use your time to the best cost advantage.
Periodically take an item you made earlier in your pricing and recheck it. You will find that it probably doesn't take you as long to make it now that you are more experienced and have learned faster ways to do things. On those items your per minute labor rate increased because you are now faster. Increase your labor rate on new projects to match that of the other items that you sell. Whenever I sell more than I can cut it's time to raise the price. Raising prices is the best way to control the amount of work you have backed up all the time. Working this way I started at $8 an hour and now because of the increase in speed I make $28 per hour on projects.
MORE SHORT TIPS
Let's look at some other approaches to pricing your work. Some have suggested to go two or three times the cost of the material. On some of the small simple things this may work just fine. But if you get into intarsia, or big clocks , you will soon find that this does not pay very well for the time spent.
There are some that feel that at a craft show $20 is the limit people will spend. So they redesign all their patterns so that they can be cut at a profit for $20. By dropping out some of the interior cuts and burning , painting, or magic marker for the detail, you can cut time. The finished product is also not the same as the original design but it has the same concept and takes less time to make. Less time means less labor, so a cheaper product that is similar to the one in the next booth that was done by the pattern and selling for a lot higher price. Customers look at price before quality in some cases.
Where you sell the items at can make a big difference too. Normally a Flea Market is considered junk that is cheap, not a place to sell a lot of high prices items. People go to the flea market to buy a lot and not spend a lot. On the other hand a craft show is usually higher quality things that sell for a higher price. At a craft show people are willing to pay more for the quality of the work. Then in my area we have a few high end shows. Like the LAW Bazaar, Lawyer & Attorney Wives, that is a high priced items show. Some of the items will sell for a lot higher price there just because of the customers.
Some think the way to set up a good show booth is to specialize in one item, like clocks. If people don't want a clock they don't stop too bother you. If they want a clock you have the biggest selection in the show, so they will come to your booth.
Look at some of the shows and see what is selling. Maybe that is the type of item you should also be selling. Some try to look around at all the items that are there and then sell something nobody else is selling. Well this works sometimes, but maybe that item just doesn't sell there. Others have tried and discontinued because they couldn't sell it either. It is worth a try to bring new items into a show, but do so with caution, you may not sell any, or it may end up to be the newest hottest item ever at the show. You can be sure if it is a big seller, everyone else will be selling the same thing at the next show. Crafters are copiers in some respects.
Then there are the ones who think of this as a hobby, not income, and will sell for whatever price they can just to sell all they make. If they make 100 items this week they price them to sell , because they will make 100 more next week. They take the time to find free wood from dumpsters, or building projects. There friends give them old paint. So when the get done their only cost is the saw blades and electricity. Those are the people that hurt the ones trying to make some extra money by doing craft shows. You look at an item that you know that your cost just for the material would be $4 and here the finished product is selling for $3, because they had very little cost in materials, and their time is all considered hobby just to pass the time away.
Another way to look at it, is if you want to sell items for $5-10 just don't cut anything that you wouldn't cut for that amount. This may mean you have all real simple and plain items, but is is the only way you can sell items in that price range. You will go broke real fast making $20 items to sell for $10 but you will sell a lot.
One big thing that can dictate the price an item brings is where it is sold at. An item that brings $20 at a flea market, may bring $30 at a high end craft show, or $25 in a store. You need to look around at the market you are in and find where the items sell for what you are willing to sell them for. Go to some of the shows, look around. If you walk around and see items for sell at prices way below what you would make them for, that is not the show you will probably sell your items at. On the other hand if everything , to you, is priced high, maybe that is the show for you to take your work to. You may have found the market for your items that will allow you to make the profit you feel you are worth.
Some feel that if they make a dime it's better than waiting for the sale that would have made a dollar. Sell for quantity and make a little on each item. That sounds like it should work in the long run, but how much extra time can you find to make the products. Are you are going to sell a 100 to make $10 or sell 10 to make $10.