Pricing Goods

The purpose of this article is to illustrate how I decide how to price my goods and services. This transparency helps consumers understand the value of products, and will hopefully help other business owners consider how to price their goods fairly.

The Importance of Fair Pricing

….

Overhead Expenses

Farming Expenses: land, seeds, water, materials, equipment, etc

Insurance: health, business, crop insurance if accessible (for botanical farmers, crop insurance doesn’t exist)

Taxes - farmers and small business owners must pay both employee and employer tax, which doubles the amount of taxes they need to pay compared to those who are only employees. I set aside 40% of my sales to cover taxes for the year - in reality it’s a few percentage points lower than that.

Formula

Let’s look at how much I make per bottle of perfume. Without any discounts, they are sold for $27 each plus $4.06 shipping, for a total of $31.06.

Cost of Materials and Shipping Supplies: $5.40

Etsy Listing Fee - $0.20

Etsy Transaction Fee - 6.5% - $2.02

Payment Processing Fee - 3% - $0.93

Payment Transaction Fee - $0.25

Shipping Fees - $4.06

Money Set Aside for Taxes - $7.28

Total: $10.92 - but this does not include a portion of overhead expenses, insurance, other essentials, or labor

This section is under construction - estimated completion date is 01/21/2023. Thank you!