Worth It
Price like you're Worth It
You deserve to be paid
It’s easy to look at something you made and think “I guess I would be willing to pay _____” or “I think people would be willing to pay ______” and end up undercharging for your work. We humans tend to be our own worst critics, and we forget that others will see the value of our work differently than we do. If putting a price on something you’ve made feels overwhelming, you’ve come to the right place. Worth It can help you do the math and give you some guidelines so that you are charging a price that lets you actually make enough money to keep doing what you love and make a living doing it.
Your business needs to make a profit. Why? Because business is not predictable. You will have unexpected expenses and fluctuating profits, and it’s better to have money available to back choices that you feel good about than to make decisions out of desperation or necessity. Because you and your business are worth investing in. Maybe that means taking classes to get better at your craft, classes to get better at business admin, paying someone else to do the business admin so that you have more time to focus on your craft, or even being able to take time off without putting your business out of business. For so many reasons, your business needs to make a profit. You might be thinking that you just want to do what you love without having to spend all your time thinking about how to make money. Think about it this way: Humans need water to survive. They bring it in, cycle it around in their bodies, and send it back out. There are humans in some parts of the world who spend hours every single day walking to the closest place to get water, and then walking back with as much as they can carry. There are humans in some other parts of the world who can turn on a tap in their own home any time of day or night and have water that is safe to drink. Who do you think spends more time thinking about water, and about how water relates to their survival? Businesses bring money in, cycle it around and send it back out, and they need it to survive. If you want to spend less time worrying about money, make sure that your business is profitable, and furthermore that it is profitable without you having to work fourteen hours a day, six days a week, with no vacations. Worth It takes the costs of your wages and materials and your desired profit and does the math to turn that into a price.
What does it take to make it?
The cost of materials should be included in the price of the product. Do you use three and a half skeins of yarn? Six cups of flour? Two yards of fabric? Ten strings of beads? A pound of clay? Worth It lets you enter information for “ingredients” and “recipes” so that you can add up the cost of your ingredients easily. It’s important to count any waste here. If you can’t use the offcuts of a piece of fabric, count the whole original yardage as used in the recipe.
The cost of materials is fairly tangible, but you will also have less tangible costs, including your time, and expenses that are not tied to the creation or sale of a single item, and you need to cover those operating expenses. This could be the costs of a website, Etsy or Square fees, storage space, studio space, booth space at events where you sell product, taxes, or anything else that you need to pay for to do business. This is one reason Worth It has a separate input for profit, so keep these costs in mind when you choose your profit.
Put it together and what have you got?
When you create a product “recipe”, you put together your ingredient costs with your time costs. You should figure out how much you want to be paid per hour, and how much time it takes to make each item. This doesn’t have to be exact, but you should be making a livable wage, and you need to figure out what that means. Worth It can help you do that math.
Once you have your ingredients and time costs, this is where you calculate that oh so important profit. You can either input a dollar amount, or you can set your profit as a percentage. Either way Worth It will calculate the other side of that equation for you. When you save the recipe, the price will show up under the recipe name on the main screen. The price might shock you. That’s okay. The price isn’t shown on the recipe page for that very reason. Being shocked by the price is a good indicator that you were undervaluing your work, even if you didn’t consciously have a price in mind yet. If you need to edit the profit or any of the other inputs at this point you can, but remember that you need to make a profit. You are worth it.
Taking inventory and planning the bigger picture…
Figuring out your price is the core of Worth It, but there are a few other places where we can help you do the math as well. Both the “ingredients” and the “recipes” allow you to track inventory, so that you can stay on top of ordering ingredients, and focus on producing the products with decreasing inventories.
The Calculate Ingredients Needed button helps allows you to easily compare the ingredients you have in stock to what you would need to make any number of that product.
More adventures to come…
The first release of Worth It will stick to the basics (with just a few fun things like having a dark mode, which you can change in the Settings), but I have so many ideas for the future. And if you have any ideas for features you would like to see, please let me know. Here are the most exciting ones:
* Break-even analysis for annual and monthly expenses, such as subscriptions or rent
* Integrating Etsy and/or Square sales to update in Worth It’s inventory automatically
* Tracking sales over time to show trends
* Notifications for low inventory
* Set a timer when creating to get more accurate on how long it takes you to create your product
