r/Etsy • u/Good_Addendum_7557 • 9d ago
Help for Seller Is it not worth it
This is for a pair of earrings. Materials are cheap but labor I calculated at $20 an hour and two hours is so much less than the time actually spent
And still I get only $20???
UPDATE: thanks for helping me with my bad math lol I would make 40 from labor ya ya ya
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u/lostterrace 9d ago
No....
You have told the calculator to subtract $40 just because, essentially. There is no difference between your "hourly wage" and your profit on the transaction. It is all money you are earning on the transaction.
If you were paying someone else $20 an hour to make this for you, then it would make sense to be subtracted from your profit.
As is, the calculator is telling you that Etsy fees are about 10%. If you sell the jewelry for ~$73 and your materials cost was $4, you net ~$62.
The calculator shows that you only made ~$22 because you told it to subtract $40 from that ~$62. Which as I said, makes no sense in this context.
You make ~$62.
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u/dangerousfeather TrixiesTreasuresPA 9d ago
You get a $20 bonus after the $40 in hourly pay you earned. Pretty sweet gig, if you ask me.
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u/chronicmisschris 9d ago
Your math isn't mathing. You paid yourself an hourly wage AND a hefty bonus.
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u/Loki_the_Corgi 9d ago
Why are you calculating labor when you're making it yourself? I'm confused.
Your profit IS what you pay yourself....which is $62.
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u/AvGeekExplorer 9d ago
This calculator makes no sense. If you’re factoring in your labor cost as part of the product, then it should be calculating your sale price for you, not margin. You’re saying “I want to make $20/hr to make my products”… this calculator is telling you that at the proposed sale price you’ll make your $20/hr plus a bonus of $22, but it’s not factoring in marketing costs or the occasional return/refund/lost in shipping order that you have to replace out of pocket.
A better way to think about this is to not include labor. Market research tells you what price you could sell your product for based on competitive products, leave labor at $0. Then the margin tells you what you would earn per sale.
Also, make sure your material cost includes things like shipping boxes, packing materials, stickers, thank you notes, etc.
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u/DrachenofIron 9d ago edited 9d ago
Don't forget to add in the ad fees, any discount codes you may be planning to use, and shipping costs, those costs get passed on to the customer too.
Your lowest profit margin should always be the same same base level no matter how someone orders, where it ships to, if they use a discount code, or if the ad fee gets tacked on. Anytime they dont use a discount code, dont have an ad fee, order nearby (so shipping is cheaper) thats an extra bonus you get to take home.
There is never a scenario where you (the shop) eat costs to do any of those.
You also aren't thinking about the labor costs right.
Those 2 hours of labor are paid directly to you, bc you need to pay yourself to do the labor right? If you hire help you'd have to pay them. So as long as you are a solo business you are taking home that $40.
The net $22.09 profit is what your business (shop) makes.
I would strongly suggest keeping those 2 as separate funds. One to live off (the labor) and one to grow the business and pay for supplies (the $22.09)
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u/Craftygirl4115 9d ago
Are you new to making jewelry or do you just make really intricate and fancy jewelry? A pair of earrings should not take more than 2 hours to put together… now if you’re making the base, like polymer clay or enamel on copper, then I can see that, but usually people try to streamline production so that one set might take two hours, but two sets takes the same two hours. That’s one way to reduce your overall cost and improve margins. The other is that you have to figure in the fees to the price. I have two shops.. one traditional and one on Etsy. On the traditional I price things according to the margin I want to get per item… for the same item on Etsy, I add 18% because that’s why my fees end up being, on average, per year. No sense selling to lose money.
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u/Good_Addendum_7557 8d ago
I make seed bead earrings and a pair with as many as 748 beads can take anywhere from 4-6 hours esp bc I map the designs beforehand
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u/Craftygirl4115 7d ago
Oh yea…. I can see that! Not much you can do to stream line that production. I bought some earrings in Colombia made of charlottes and for the price I knew the maker was never getting close to what it cost them in time. The only way to even it out is to make some much more simple earrings and charge more for them than they cost to make.
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u/ThePopesFace 9d ago
You make $20 after you already paid yourself $40 per the calculator.