Changing from a hobby to business

I recently considered making jewelry to sell. I am having trouble figuring how to price anything! I'm barely learning about crystals and different types of beads. But I am really lost at how to look at this as a business. What can I do?

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Hobby to business? Me too! NEW
by: Anonymous

This is what I do to figure pricing.

First, when I get an order (I shop mainly online as I live in a rural area and the two nearest bead stores are about 30-80 miles away) I count the number of items and divide shipping by that amount. I add that amount to the per piece cost and write it on the invoice. If I go to a bead store then I do the same thing with tax so I always know what each piece costs. Strands of beads are counted individually too so I have a price on everything.

I made a project/inventory page where I make a listing for the project and each bead or piece used, how many were used and use this for cost of the piece. Don't forget to double this for earrings (live and learn thing, lol). Everything is counted, from crimp beads to how much my wire costs per inch. For my work time, I use $15.00 per hour. As mentioned before I live in a rural area and this goes well with the cost of living here. Your area may be higher and you could charge more for your time. I also have a clock in my line of sight to keep track of how much time to make the completed piece. I use a minimum of 15 minutes and charge accordingly based on 15 minute increments. Add up the cost of the piece and my labor and this is my base cost. Sometimes (a lot of the time actually) the cost will be near what my whole sale price is. If I retail the piece I double the piece cost before adding in the labor charge, so the labor isn't doubled (another live and learn lesson). If you can get more for the piece than this price, woo hoo, go for it. More money for more beads, lol. Don't forget to take pictures of the piece. I always attach a photo to this page for reference. I know there is probably software for this, but just starting out, this is how I do it. Hope this helps. Good luck!

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Changing from a hobby to business NEW
by: Anonymous

I live in a rural area and consign in several nearby stores. Over time, I realized that two-thirds of what I sell is for $5 or less. Five to ten dollar items sell best around Xmas, Valentine's Day and Mother's Day.

Therefore, I decided to design with those prices in mind. I try to create the prettiest designs with the cheapest beads I can find.

For example, a necklace and bracelet set costs .50¢ to make with crochet thread. If I charge $4-5 for the necklace and $2-3 for a bracelet, minus consignment, I earn seven times what I invested.

I keep my patterns fairly simple and do not calculate my time. I'm very satisfied with this formula, because this a hobby and not a business.

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Changing from a hobby to business NEW
by: Anonymous

I buy beads on Ebay. I set the format for "low to high" and choose those with free shipping.

I prefer the clear acrylic faceted beads, because they are less expensive and just as beautiful as the glass beads. My limit is .005¢ apiece.

I also like to blend imitation pearls for less than .005¢ apiece and Tibetan silver for .01¢ apiece.

With these limits in mind, I can create with one price in mind. I do not calculate my time.

For a large inventory, I use a variety of simple patterns with a variety of color schemes.

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don't forget the tax man... NEW
by: Sherman Duke Jewelry

I'm doing the same, at some point. For now all sales money goes towards buying more materials. I'm stashing all of the receipts so that they can become a tax write off. I only need to show a profit two out of five years.

As for pricing you need to find out what your customers can/will afford. Creating package deals helps. I can make stuff for about 10% of cost.

I also make jewelry while they wait and watch. I might made a kid's piece for free if mom buys a set of earrings.

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