How Sell Embroidery for a Profit

Ok, it's signed and dated. Now are you ready to sell embroidery? Making a piece for profit is different from making gifts for family and friends.

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

Note: This is just a rough suggestion to get you started. To really learn how to determine the perfect price, click for instructions on how to download a free e-book with a 10-day course!

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, especially in a hand craft business. 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 online or offline. You are worth it!

For more information about how to set craft prices, please see How to Start a Home-Based Craft Business by Kenn Oberrecht.

Are you ready to turn your hobby into a legitimate home crafting 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.

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I use this service myself and I know how well it works, so that's why I recommend it to you. It actually works! If you sign up for SBI! through the links given on this page, you can start your own business today, and I'll receive a small commission that helps to support this embroidery website.

Thank you in advance, and if you need help getting your new SBI! website started, just ask. I look forward to chatting with you in the SBI! Forums.