The handmade pricing formula
A widely used rule for makers: work out your full cost, including a fair wage for your time, then double it for the wholesale price and double that for the retail price. The retailer's half of the retail price pays for their shop and marketing; when you sell directly, that half pays for your own selling costs, such as platform fees, ads and returns.
Wholesale = cost × 2
Retail = wholesale × 2
Example: a pair of earrings
| Line | Amount |
|---|---|
| Materials | $6.00 |
| Labour (0.5 hours × $18) | $9.00 |
| Overhead | $1.00 |
| Cost | $16.00 |
| Wholesale (× 2) | $32.00 |
| Retail (× 2) | $64.00 |
With a 2.5 wholesale multiplier instead, wholesale becomes $40 and retail $80.
When to change the multipliers
- Only selling direct? You may choose a lower retail multiplier, but check the result in the Etsy fee calculator: fees, postage and ads still have to fit inside the price.
- Prices look too high? Do not cut your wage first. Look at faster ways to make the item, cheaper materials bought in bulk, or a simpler version.
- Compare with the market. The formula gives a floor that pays you properly; what buyers will pay in your niche decides how far above it you can go.
Frequently asked questions
Why include my wage in the cost?
Your time is a real cost. If you leave it out, the 'profit' is really your wage, and you cannot hire help or grow without raising prices later.
Do I have to use 2 × 2?
No. It is a common starting point, not a rule. Change the multipliers to match your market, your channels and your margins.
Does the retail price include Etsy fees?
No. The retail price is what the buyer pays; Etsy's fees come out of it. Run the retail price through the Etsy fee calculator to see your real profit.
Last reviewed: November 2026 · By Muhammad Shujah