How to price handmade products so you actually profit
A guide to pricing that accounts for materials, time, fees, and a fair margin.
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Underpricing is one of the most common mistakes new handmade sellers make — often because pricing gets based on materials alone, without accounting for time, fees, or a fair margin.
This guide walks through a straightforward pricing method that accounts for the real costs of running a handmade business, in AUD, with Australian platform fees in mind.
There's no single correct formula, but starting from real costs rather than a guess makes a meaningful difference to whether the business is sustainable.
How to price a handmade product
Calculate material cost per item
Add up the exact cost of materials used for a single item, including packaging.
Estimate your time cost
Track how long an item takes to make and multiply by a reasonable hourly rate for your time.
Add platform and payment fees
Factor in listing, transaction, subscription, and payment fees charged by the services you sell through.
Include a margin for overheads and profit
Add a margin covering tools, studio costs, and an actual profit — not just break-even.
Compare against the market
Check comparable handmade products to make sure your price is credible without underselling your work.
Revisit pricing regularly
Update pricing as material costs, fees, or your skill and demand change over time.
Frequently asked questions
Should I price based on what competitors charge?
It's useful context, but start from your own real costs first — competitor pricing alone can lead to underpricing if their costs differ from yours.
How do I account for GST in my pricing?
If you're registered for GST, your listed price in AUD should be GST-inclusive, with GST factored into your margin calculation.
Is it okay to charge more for one-of-a-kind pieces?
Yes — unique or highly time-intensive pieces generally warrant a higher price than repeatable, quick-to-make items.
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