Pricing your products on Etsy can feel like one of the hardest parts of running your shop.

You want to attract buyers but you also need to make a real, sustainable profit.

Here’s the thing:

If you don’t price properly, you’ll work harder for less money and burn out fast.

The good news?

With a simple strategy, you can price confidently, cover all your costs, and still stay competitive.

Let’s break it down clearly (no complicated maths, no guesswork).

Why Proper Pricing Matters on Etsy

Pricing isn’t just about covering materials.

It’s about:

            •           Paying yourself fairly for your time and skills

            •           Building profit for future growth

            •           Protecting your shop’s reputation (undervalued products often seem “cheap” rather than “good value”)

You can’t run a strong, sustainable business if you’re barely scraping by.

Pricing for profit = respecting your work AND setting up long-term success.

The Basic Etsy Pricing Formula

A simple, beginner friendly formula you can use:

Materials + Time + Overheads + Profit Margin = Retail Price

Let’s break it down properly:

            •           Materials:

How much you spent on physical supplies (e.g., wood, paint, paper, thread).

            •           Time:

Pay yourself an hourly wage (yes, even if it’s just you!)

Example: If a product takes 2 hours to make and you pay yourself £15/hour, that’s £30 for labour.

            •           Overheads:

Business expenses like Etsy fees, packaging, marketing tools, and postage supplies.

            •           Profit Margin:

Add extra to build real profit, usually 10–30% depending on your niche and competitiveness.

Quick Example

            •           Materials: £5

            •           Time (1 hour @ £15/hour): £15

            •           Overheads (estimated per product): £2

            •           Desired profit margin: 20%

Add together:

£5 + £15 + £2 = £22

Then add 20%: £22 x 1.2 = £26.40 retail price

You could round up to £26.99 or £27 to suit your shop style.

Other Costs to Factor In

            •           Etsy Fees: Etsy takes a listing fee, a transaction fee, and a payment processing fee. Always check their current rates.

            •           Postage: If you offer free shipping, make sure you build this into your pricing.

            •           Packaging: Boxes, tissue paper, stickers, it adds up!

Always price products so all costs are covered, and you’re left with profit at the end.

Helpful Resource:

            •           https://rebeccaeggleton.com/blog/b/how-to-price-your-products-for-profit

How to Stay Competitive Without Undercutting Yourself

1. Know Your Market (But Don’t Copy)

Look at what other successful shops in your niche are charging, but remember:

            •           You don’t know their costs

            •           You don’t know if they’re actually profitable

            •           Your brand, quality, and customer experience might be different

Use competitor research for context, not to set your price blindly.

2. Sell Value, Not Just Products

Buyers aren’t just paying for the item, they’re paying for:

            •           Handmade quality

            •           Unique design

            •           Personalised options

            •           Sustainable materials

            •           Fast and friendly service

If you communicate your value clearly, people are willing to pay more.

Helpful Resource:

            •           https://rebeccaeggleton.com/blog/b/brand-identity

3. Lower Prices Don’t Always Mean More Sales

Often, raising your prices (with better branding and better customer experience) attracts more serious, high-quality buyers.

You want buyers who respect handmade work, not bargain hunters.

Quick Etsy Pricing Checklist

Before you publish any new listing, ask:

            •           Have I included ALL materials, time, and overhead costs?

            •           Have I added a healthy profit margin?

            •           Have I factored in Etsy fees and shipping (if offering free delivery)?

            •           Have I positioned my product as high-quality and valuable?

            •           Am I confident that this price reflects the true worth of my work?

Final Thoughts

Smart pricing isn’t greedy, it’s respecting your time, skills, and future goals.

You deserve to earn a real income from your talent.

And your future customers are happy to pay for value when they see it clearly.

Want a full checklist to help build your Etsy shop the smart, sustainable way?

Grab my free Etsy Launch Checklist

https://link.smartgrowthsystem.com/widget/form/hx3KsJCukszI7crb5E4o

 It’s packed with actionable steps for pricing, branding, and growing strong from day one!

You’ve got this and now you have the tools to price with confidence!