How Sell Embroidery for a Profit

Do not undersell your time! Giving gifts as a gesture of the heart is one thing, but selling embroidery too low undermines the respect for handmade work. If you are doing machine embroidery, you still need to consider your time and the cost of materials and equipment.

Here's a formula to help you calculate what the price should be:

Materials + Labor + Overhead + Profit = Price

Materials
Add up the total cost of materials: fabric, thread, beads, charms... everything in the finished embroidery. Will the piece be framed? Include the expense for the framing materials. This is where it pays to be registered as a legitimate business. A business ID number allows you to purchase materials at a wholesale price with no tax.

Labor
As I said, it's important to factor in your time. I hope you love to embroider, and it is time well spent, but don't you want to be paid at least minimum wage? To calculate the labor expense, multiply your hourly wage by how many hours the embroidery takes you. Include the finishing and framing time.

Overhead
This covers your operating expenses. In other words, it's the cost of equipment and running your business. As a legitimate business, you will have expenses besides the cost of materials. To calculate an overhead of 33.3%, take the greater of labor or materials and multiply it by .333 for your answer.

Profit
So far, we've only covered the actual manufacturing costs. Now it's time to make some money! Most manufacturers earn at least a 100% profit at this step. So multiply the total manufacturing cost (materials + labor + overhead) by 1. If you want a 125% profit, multiply by 1.25. Place that value into the above formula as profit.

Price
The manufacturing cost (materials + labor + overhead) plus profit gives you the wholesale price. Typical manufactures then sell to retailers at this wholesale price and retailers then add on their profit, which can range from 5% to 200%! As an individual crafter, you don't have to worry about that. I'm just telling you so you'll feel comfortable adding more of a profit to your price when you sell embroidery. You are worth it!

Are you ready to turn your hobby into a legitimate business and make it pay for itself? It's not a journey for the faint of heart!

When you're ready and legally registered, you can sell embroidery at local markets, online, or do both, as I do. Learn from my experiences:

Services to Sell Embroidery Online that I've Tried

check out the stories

of some other SBI owners

eBay
I had an eBay Store for 1 year from 2006-2007. Stores are better than auctions because they give you a permanent address and allow your listing to run for 30 days for a smaller fee. The more inventory you have, the more cost effective it is. My store brought in great traffic at first, but then eBay changed their policies and took stores out of search. Then they raised their fees. And then they changed the way that buyers leave feedback so that the seller can be blamed for the postal service time, which I'd already run into as a problem. I don't like the direction eBay is going. The auction craze is over, and they are chasing away the loyal store owners as they try to drive them back to auctions, which have higher fees and are more profitable for the company. If you want to try eBay, do your homework first and take advantage of their free online classes. Sign up for the Auction Bytes newsletter if you sell embroidery online to keep up with industry trends and news.

Etsy
Ok, I haven't sold on Etsy, but I've browsed around and I've heard from people who have bought and sold on there. On Etsy, you can sell embroidery or any handcraft. If you have something unique and interesting, you'll do better since many of the fellow selling artists are the buyers. Listings are for 6 months, so if you have something that just won't sell otherwise, try it there. I decided not to use Etsy because I can get my inventory to move faster elsewhere.

Go Daddy
Do not add Go Daddy until you

have an SBI website

and have completed the SBI training on how to sell embroidery. This is the top company for purchasing extra domain names. They have many other services, including the Quick Shopping Cart. It's hard to find a nice shopping cart and website at a decent price. Most cost a couple of hundred dollars a year! The Quick Shopping cart is nice because the basic level, 20 item store, costs less than $10 a month. The downside is that you have to build your own traffic, but that's easy with SBI.