If you're a handmade business owner looking to expand into wholesale, pricing your products correctly is crucial to maintaining profitability. Wholesale pricing isn’t just about cutting your retail price in half—it requires a strategy that ensures you cover costs, make a profit, and create room for sustainable business growth. In this guide, we’ll break down how to price for wholesale without losing profit and introduce you to Handmade to Entrepreneur, my program that helps you master wholesale pricing and build a thriving handmade business.
Understanding Wholesale Pricing
Wholesale pricing means selling your products in bulk at a lower price to retailers, who then resell them at a higher retail price. Unlike direct-to-consumer sales, wholesale requires careful calculation to ensure you remain profitable even when offering discounts for volume purchases.
Key Steps to Price for Wholesale Profitably
- Calculate Your Cost of Goods Sold (COGS)
Before setting any prices, you need to know your exact cost per unit. Your COGS includes:- Materials (e.g., beads, fabric, wax, packaging)
- Labor (the time it takes to make each piece)
- Overhead (rent, utilities, website fees, marketing, etc.)
- Example: If your raw materials cost $5, labor is $3, and overhead per piece is $2, your total cost per unit = $10.
- Use the Wholesale Pricing Formula
The general wholesale pricing rule is:Wholesale Price = COGS x 2 (or more)Using our example:- Wholesale price = $10 x 2 = $20
- This ensures you cover costs and make a profit when selling wholesale.
- Determine Your Retail Price
Retailers will mark up your wholesale price to set their retail price, typically 2x wholesale (or more).- Retail Price = Wholesale Price x 2 (or more)
- In our example: $20 x 2 = $40 retail price
- This means retailers can profit while ensuring your pricing structure remains competitive.
- Account for Profit Margins
Your pricing should allow room for:- Discounts for bulk orders
- Shipping costs
- Potential price increases for materials and labor
- Profit beyond just covering expenses
- If your margins feel too tight, adjust your pricing or seek ways to lower production costs.
Why You Shouldn’t Undervalue Your Work
One of the biggest mistakes handmade sellers make is pricing too low. If you don’t price for profit, you:
✅ Won’t be able to afford bulk production
✅ Will struggle to scale your business
✅ Could get stuck in a cycle of working hard but not making real money
✅ Won’t be able to afford bulk production
✅ Will struggle to scale your business
✅ Could get stuck in a cycle of working hard but not making real money
Learn Wholesale Pricing & More in Handmade to Entrepreneur
If you’re ready to confidently price your handmade products for wholesale and expand your business, my program Handmade to Entrepreneur covers everything you need to know! We dive deep into:
- Wholesale pricing strategies
- Finding and reaching retail buyers
- Scaling your handmade business beyond Etsy
- And so much more!
Want to master wholesale pricing and grow your business? Join Handmade to Entrepreneur today here!
By pricing strategically, you can take advantage of wholesale opportunities without losing profit and set yourself up for long-term success. Are you ready to expand your handmade business? Let’s do this together!
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