Check out this article about costs/pricing from Beth over at Etsy:
Figuring out how to price your items can feel like the most challenging part of selling. Don’t worry, it’s normal to feel a little overwhelmed. Fancy business schools devote full semesters to this subject. And the one thing they teach? There is no magic pricing formula. Fortunately, pricing is more art than science, and Etsy is full of great artists.
If you are running your Etsy shop as a business and not just as a hobby, the first thing to do is to cover your costs. Direct costs include:
- materials used to make the item
- PayPal fees
- Etsy fees
Even include that yarn that you dug out of the closet where it’d been stashed for years or those buttons your next door neighbor gave you; these are materials you could be using for something else, like design fees, the internet in your home office or rent utilities.
Indirect costs may include machinery: for instance, a large loom, or payment for access to a darkroom or a metal shop. These costs should be factored in as well.
Next, consider your time. Think about the time it takes to create the item and list it. On the creation side, don’t forget the time to design the item as well as the time to physically make it. Include time that might otherwise be considered “down time,” like working on the item while at your table at a craft fair, knitting on the bus on the way to work, or spinning during your favorite television show. In addition, remember it also takes time to take a great photo, to list your item, as well as to carefully pack and ship the item.