The pricing question is the toughest I have come across to date.
Here are some of the comments I have heard:

"You are undervaluing your work."  - numerous and varied sources
"Do NOT apologize for your prices."  - my father

I am starting to think that there is a lot of truth to the idea that you should not WAY underprice your work.  Honestly, if I was looking to buy a DVD-player and saw one for $300, one for $250, and one for $99; I doubt very much I would buy the $99 one, I would probably think it was a cheap model, as opposed to inexpensive.  On the other hand, I might buy the $250 one versus the $300 one for the savings.

The BIG question is: how do I find that happy medium when pricing my own work?

I make and sell jewelry as a hobby.  I do shows for friends, not bead shows.

I base my material pricing on replacement cost.  I do so on the basis that I will restock to my normal level after an item is sold. 

I, too, use an excel spreadsheet to listed all items including crimps, head pins, etc.  Then I add 20% for overhead (sales tax, shipping, gas if purchased locally).  Then I add an hourly rate for how long it took to make.

I do a lot of beadweaving, so a necklace which took 5 hours to make would be much more expensive than a necklace that is on chain with stones on headpins.

I probably do underprice compared to a professional, but our markets are different.  I am selling to friends and acquaintances.  I am not selling to the general public.  If I were to go to a craft show or bead show, I would increase my prices to cover the costs of booth rental, making up cards, collecting and submitting sales tax and all that.  Personally, for a hobbyist it sounds too complicated.

Hope this helps.

The questions regarding pricing have made for interesting reading.  This is something I've been struggling with for some time, and I think I've finally come up with a pretty good method for myself. 

I've assigned myself and hourly wage.  My time and skill should be reflected in the cost of the item.  I've created a really quick sheet just in a Word table - project, start time, end time, total, X hourly rate.  This way, as soon as I sit down to begin a piece, I record the time I start. Once I've finished, I just do the multiplication and work out the hourly rate portion of my cost.

I also use a spreadsheet for all of the components I use in a piece.  I have listed the components I use most often (plus left a few blank spaces for components I don't often use or whatever).  I have columns for the quantity, price per component, and a total column. I use one of these sheets per project.  It makes it SO much easier to figure out the total cost of the supplies.

One other thought, and I got this from the book "Marketing and Selling Your Handmade Jewelry", by Viki Lareau, if you tend to sell quite a bit of work to friends and family, why not establish a friends and family discount?  That way you can still price things fairly in terms of supplies, your time, and your unique designs (I think all of us should take that creative originality into account!), but you can offer a percentage off to family and friends. I've started doing this, and it means I'm actually pricing my work higher (as I should be!  I was really surprised and dismayed at how much I was underpricing my work!), but I don't have to feel like my friends and relatives will be put off by higher prices because of the discount I'd offer them.

Long posting!  But these are a few of the things that I've found have made me more organized, and hopefully they're of use to someone else!

 

I was really struggling with how to keep track of everything and how to break it up so I could add each item to a jewelry piece.

I found a LIFE-SAVER!  Jewelry Design Manager Software.  It is AMAZING (please know that I don't make any money off the sale of their software :)

This program allows you to enter your inventory and prices each item.  From there, you can "design a piece" by selecting all of the things you used for the piece.  It calculates the cost, keeps track of how much you have left, etc.  There are also some other neat features depending on the level of the software you buy.

It was a bit of leg work up front, but once I had my inventory in there, it was PERFECT.

Good Luck

Trina

 Does nobody charge for artistic creativity? 

I for one spend hours (luckily its still only a hobby with me ) just looking at a particular set of beads, then trying out this combination and that till I come up with what I think is the perfect colour combination, bead size, design etc..  A remark made by my daughter - 18 yrs, it doesn't have to be the perfect design, a very good one will do !!!

Pricing is always a difficult issue, I know I struggle with it all the time. After juggling through different formulas, I use something like this: time+ materialsX2 + overhead (5%). That's to give me a basic price (it's my absolute minimum). I usually multiply it by 1.5 or 2 to get the sale price. those 2 prices give me maneuvarability for the selling price depending on who I sell to and where I'm selling. I'll usually multiply something cheaper by 2 and something more expensive by 1.5, because I feel sometimes the more expensive items become a little too pricey if I multiply it by 2 but I can compensate a little with a larger profit margin on small items.

The profit margin is important if you are trying run a business, it gives you something to buy in bigger quantities and better quality. It helps cover the fees of pricier shows, traveling...

At my first high end show this year, a gallery owner interested in selling my jewelry (the one of a kind pieces costing around 500$ each) told me to never, never lower my prices, and if anything that I could charge more. And  yes, my 30$ earrings sold very well, but so did the more expensive pieces. So don't be afraid to sell your jewelry what it's worth. It also helps to see what other people sell similar items. I started working on strung jewelry (I usually do weaving) because I have no time to work (new baby), and I use only really good quality materials and I made a pearl, crystal and silver necklace that I was going to price at 180 $ (but feeling maybe I was overdoing it a bit). I was walking somewhere and saw in a jewelry store (the type where you have to ring to go in) a necklace in the same style as mine, same quality of material (but not such a nice finish though !). I went in to see their asking price : 500$ !

I have been using http://www.artaffairsoftware.com/ to keep track of my inventory and pricing and I like it. I chose it over the other one mentioned in this thread simply because there was a 30 day free trial. I like to see how it works before I buy. As far as I can tell it does exactly the same things as the other one.  

As for the artistic creativity, well I figure it's part of my profit margin

I am green with envy regarding your pricing cabability.  I live in a small rural town (under 3,000) in the very depressed state of Kanas.  A two-bedroom 1960 home would not sell for more than $90,000 here (which is on the high end), whereas my sister in law purchased a similar home in Los Angeles for over $500,000.  Rent here on a nice apartment is considered high if it's over $500 a month, but a similar apartment cost my brother in law $1,200 in Colorado. 

A handful of people here appreciate hand crafted jewelry and are willing to pay the price.  At this point I'm pushing it to double my cost of beads/findings and adding sales tax, and then rounding to the next $5 mark.  Even at that I hear lots of remarks about being able to get jewelry cheaper at xyz (mass produced cheap stuff). 

Someday soon I hope to be able to sell on the internet, but until then, I'm pretty much stuck if I want to sell anything.  I've started searching for high-end stores in the larger cities and we will see how that goes.  Alice

I'm from the Philippines and started making and selling jewelry with my daughter about 2 months ago. To date, we have sold more than 40 pieces, some online and a lot to friends and relatives. To determine selling price, we compute the cost of materials and divide this by 20%. So if the cost of materials is Pesos 20, we sell the item at P100 (this formula has a x5 mark-up). Out of the total sale price, we allot 50% to design and labor, and 30% to profit. We're making one-of-a-kind, never duplicated designs and buyers seem willing to pay the price for this. They actually think the price is even low. I designed a pricing template in Excel and organized my beads and other materials into groups and assigned codes, which are all encoded in Excel so we keep track of our inventory costs. We also invested in beading containers and drawers, where we posted the codes and the cost in each drawer so we just list down the cost and the number of pieces of each material in a notebook before encoding this in the costing template. I organized the beads according to color groups. It's easier and more practical especially when designing pieces and matching color combinations.

I wrote a blog post about pricing jewelry if anyone has read this far and still wants more ideas ........... or maybe just the same ideas in a different order.

http://askszarka.blogspot.com/2008/06/pricing-jewelry.html

If my writing style didn't bore you to absolute tears click on the ask szarka banner on the top and you can read a whole slew of articles that have been posted about the trade.

Szarka

Black Cat is Correct:

Never forget that by X3 you are able to then cover all those little costs to you that ADD UP!

Do not I REPEAT DO NOT, under price yourself, one of a sellers most abused self-destructing and undermining things to do.  WHY?

because you are undervaluing yourself, your work and your talent! Not everyone is willing to take the time and materials to do it themselves... I have in the past had many 'friends' ask me to show them HOW TO do something.  I am polite and tell them ok, but they must get the materials to do so. We go shopping and they SEE how much they need whether it is sewing or beading... from tools, to materials to the beads themselves.  They will usually try one project, then ask me to DO the rest for them... we work out a deal and (sometimes free for friends) or they give me the materials and I make them something as a thank you.  I know the cost - they do not.

When dealing with 'potential customers' who want to 'know how' to do something I am polite and in a similar way explain how to do it.  I find I get more customers & friends this way.  Sometimes I find a new beading buddy!  Which is just as good!!!