Selling handmade items online is a great way to satisfy your creative side while running your own business, and there’s no better time to start than right now. What started out as a relatively small niche in the ecommerce world, handmade products has become a full-grown industry in the past several years. If you’re interested in starting your own online business selling handmade items, here’s everything you need to know.
Pros and Cons of Selling Handmade Items Online
As with any new endeavor, there are advantages and disadvantages to starting a handmade crafts business online. Let’s take a look at the pros and cons.
Pros of Selling Handmade Items Online
- Your business will involve selling products you’re passionate about.
- You can work from home, on your own schedule.
- You can quickly change your product line when you want to.
- You can establish a loyal and repeat customer base.
- There are various sites and marketplaces where you can sell handmade products online.
Cons of Selling Handmade Items Online
- Finding the perfect niche within the handmade crafts market can be challenging.
- Depending on your items, production, sourcing materials, order fulfillment can be time-consuming, making scalability difficult.
- Handmade products have to be of consistent and exceptional quality to sell successfully.
- It may become boring or tiresome to keep making the same products over and over again.
Sourcing Materials for Handmade Items
You might start out by finding materials to make handmade items at craft stores or websites, flea markets, estate sales, and other retail stores. However, your best, most economical option is to find wholesale suppliers online and to buy materials in bulk. There are hundreds of suppliers to choose from, here are some to consider:
We’ve outlined some great tips for sourcing products to make handmade items here.
How to Price Handmade Items
Pricing handmade items can be tricky. Pricing too low means you won’t make enough profit to stay in business. Pricing too high means customers won’t buy your products, and you can’t stay in business.
So, how do you find the perfect price?
Obviously, the first thing to determine is how much you’ve spent on the materials to make the item. Then, you need to decide what your time is worth. This may be the hardest decision to make as you’re determining pricing, but you do deserve to be paid for your time. Consider what you would pay an employee to make your products as a starting point.
Once you have the cost of materials and your hourly wage, you can use the following calculations to determine price:
Supplies + Your Time = Item Cost
Item Cost x Markup (between 2.0 – 2.5 is recommended) = Wholesale Price
Wholesale Price x Markup = Retail Price
Here’s an example:
The materials used to create a necklace cost $1.50, your hourly wage is $15, and it takes you 20 minutes to make one item. That means that your labor costs for one necklace is $5.00.
$1.50 + $5.00 = $6.50 This is the total cost of the item.
$6.50 x 2.25 = $14.63 This is the wholesale price.
$14.63 x 2.25 = $32.93 This is the retail price.
Even if you don’t plan to sell your items wholesale, it’s worth it to calculate the price because things may change in the future. If you’re selling your products at a retail price that’s close to the wholesale price calculation, you won’t have much room to provide discounts for wholesale orders.
Where to Sell Handmade Items Online
Here are some of the most popular places to sell your handmade items online:
This online marketplace is ideal for artists who want to sell their unique artwork, including sculptures and paintings. All you have to do is register as an artist and list up to 20 masterpieces for free or choose from other available plans to list more items. The free account comes with 35% sales commission with reduced rates for the paid plans.
Aftcra is an online marketplace for American crafters. You can sell handmade items including baby products, clothing, home décor and paper goods, as long as it is made in the US. They do not accept vintage items or any resellers. There are no fees to list items, but there are transaction fees (7% when items sell) and there is a minimum required price of $10 on the items you list for sale.
Artfire is a great marketplace to sell vintage items, craft supplies, and handmade products. There is a small monthly charge to have a shop on Artfire, as well as listing fees for the smallest paid plan. Once you upgrade to the middle tier, the listing fees are removed.
Cratejoy is an awesome way to get your crafts to people worldwide and generate recurring revenue. It’s a subscription box business for sellers. You can create your own box with your handmade products. Of course, if you sell craft materials, you can create a box with instructions on how subscribers can use the materials you’ve included to create DIY projects. It costs $39 a month to use their service with added transaction fees for two packages. You can either use their service to create subscription boxes for your own website or you can list your products on cratejoy.com.
Etsy is one of the most well known handmade marketplaces. It’s simple to set up, you can reach a large audience, and it’s continuously improving the seller and buyer experiences. Inexpensive listing ($.20 USD per unit) and transaction (5% of the displayed price plus shipping) fees allow you to list and sell hundreds of handmade products without breaking the bank. If you choose to work with this software be sure to follow these do’s and don’ts of listing products on Etsy.
Handmade at Amazon has been in existence for a few years now and is gaining momentum in the handmade goods arena. While the Handmade sub-site isn’t as well-known as Amazon.com, it does offer you access to millions of shoppers. There is a 15% commission fee for the items you sell, but the name Amazon means that you already have credibility with your audience. Learn more about Amazon Handmade.
If you’re marketing and selling eco-friendly handmade products, Hyena Cart is an ideal site for you to sell on. You can opt for an individual store or partner with other sellers to get more exposure. There’s a $10 setup fee with an ongoing $5 per month cost with no listing or commission fees.
This marketplace is the place to sell your handmade jewelry, accessories, and knitted items. You can list as many items as you want for $5 per month, without additional commission and listing fees. Setup is super easy too with their bulk product import feature for sellers already on eBay or Etsy.
Zibbet is an online marketplace where sellers can list craft supplies, fine art, vintage items, photography products, and other handmade items. The fee starts at $5 per month, with no additional listing or commission fees and comes with your own website and custom domain, along with access to their marketplace.
SpoonFlower is a website that is perfect for designers that don’t create physical products. Shoppers can choose your design and have it placed on fabric, throw pillows, wallpaper, and other items. Then, SpoonFlower produces the actual product. To start, designers receive 10% of sales, along with the potential to increase your commission when you become a power seller.
There are now more options than ever for artisans to showcase and sell their work online. With some research into sourcing materials and the different marketplaces available for selling handmade products, you can find the platform that works best for your business logistically and financially.
If you are looking for inventory management software that will help you track costs and quantities from raw materials to the finished product, ecomdash has a solution for you. Our inventory management software can track the raw materials along with your finished product. You can create work orders to stay organized and ensure your product quantities and details are accurate across all your sales platforms. Give it a try for free today!
Editor’s Note: This blog post was originally published February 2019 and was updated in March 2020 to reflect more accurate and relevant information.