I’ve seen lots of blog posts out there with this same title. So here’s my spin on things.
I get many, many emails from potential customers asking me for discounts. They tell me that they simply can’t afford my prices but they really want my stockings/pillows/etc. I’m not really sure what they are asking me for—having monogrammed stockings or pillows is not a necessity in life. Buy the basic ones from Target as they are very inexpensive. I am truly flattered that they love my work but there just isn’t much I can do—I simply can’t (and won’t) work just to break even. That’s not very business savvy according my business management professors in college 
. When customers ask for a discount I am tempted to ask them if they do that same thing at Macy’s—ask the clerk if they can have a discount if they buy more than one pair of pants. Yup, it sounds silly when it’s put that way. But I don’t say that—I simply reply with, “Price is firm”. Or better yet, I should advise them to buy my sewing pattern and make the stockings themselves!
1. I live in the Unites States of America, not communist China. A living wage here is much higher. 
Depending on the time of year, I also have 1-2 assistants. I pay them a decent wage as well. Like my cousin tells me, “We may be Mexican but we don’t work for beans!” Amen, cousin.
2. Self employment taxes are extraordinarily high. At least in my opinion they are high. Most home-based businesses pay their taxes on their individual returns which means that we are taxed by our household income (spouse’s income included) which can be around 10-30%. To incorporate my business would mean to pay even higher taxes. Sigh. So being honest means I have to pay Uncle Sam.
3. Supplies (variable costs) for me include, first of all, fabric. Have you seen the price of cotton in the last few years sky rocket? I pay double for muslin and other cottons now compared to two years ago. I use a ton of linen—a ton. Linen is spun from flax seeds—not cheap. All of my fabrics are man made fibers—silk, linen, and cotton. I do not use any polyester fabrics. Ever. (*Shivers*) I want you to have the best and the best isn’t free. Add to this zippers, stabilizers, thread, etc.
3. Equipment (fixed costs). For my business‘handmade’ doesn’t mean that I am sitting by candlelight at night stitching stockings or pillows with a needle and thread. (For many businesses, that is handmade though, well, hopefully not the candle part) In my business I have to have professional software which costs in the thousands, the best embroidery machine, the best sewing machine, a great camera with changeable lenses, sometimes hiring a photographer when needed, and all of that costs mucho dinero. My embroidery machine cost more than a car—I’ll just leave it at that. Other fixed costs include Pay Pal fees, credit card fees, website hosting fees, webmaster fees, etsy fees, and on the list goes.
4. Tender loving care, oh and lots of time. On the stockings pictured below—I digitized every one of those names unique to that order. The snowflakes are my own creation as well—digitized by yours truly. Every individual stocking starts out with me at my computer. The name is typed out in the customer’s choice of font, I manually space the letters to get the best look—some letters further apart, some overlapping until it is visually pleasing. The snowflakes are then added in, again one by one, spaced to look pleasing all the while remembering that it must all fall within a 7” wide strip of fabric. Okay, too much information, back to being general about things. Notice each of the snowflakes is in a different position, all relative to the name—all hand done. Then the real work at the machines begins. I won’t even try to explain that part!
Do you see the zipper installed in the below image? Exactly, you can hardly see it because I’m good at what I do. Quality, quality, quality. (Shameless bragging, sorry.)
5. The final step is packaging, which my amazing husband does for me. He prints the labels, weighs each package, calculates the postage, buys my shipping supplies, etc. What a great guy! He could easily say to me, “I just worked 10 hours today counting beans, do your own work lady!” But he spends hours a week at night helping my our small business.
6. Unique. I often get emails from clients, “I’ve never seen anything like this before!”. And that’s why handmade costs more than crap made. You are paying an artist. She has a unique talent that she’s willing to share that with you for a very modest price.
Please value that talent.
