Selling & Pricing (Part 1)

I was mulling some things over the other day, and I got to thinking about people who sit and craft their own stuff, as opposed to factory made, mass production. Obviously mass produced items will almost always be cheaper to produce, as they tend to be made abroad where labour is cheaper; materials are cheaper, and all in all the whole process costs far less.
However just because they are cheaper to make, does not mean by the time they arrive on our shores they haven't gone up a million percent (OK I'm exaggerating). Simply put a known name on it, because people will buy branded items, and boom! Huge price increase, even though it was probably pennies to make, the name pushes the price through the roof.

Making hand made goods is such a touchy subject; unless of course you have already "made it" and everyone is clamouring for your work, so how do you put a price on your time, effort and skill?
Well the starting point has to be the cost of materials, you obviously have to cover your own outlay, otherwise you are working at a a loss; but what about the time? How do you put a cost on the time and skill with which you sat and carved an item, or made your design; saddle stitched it, sweated like a broken dog to meet unrealistic deadlines?

Firstly you have to assume that it's worth to yourself is not the same as the worth to the buyer, they want to pay the smallest price possible (generally) for an item of distinct individuality, but we have to remember that they are asking, so realistically, they must WANT it.
Now have to decide if the tutting and rolling of eyes is because they actually think it's a bit overpriced, which happens; just because it's handmade shouldn't mean they need a mortgage to buy it. Or are they stalling and moaning because although they want it, they just can't afford it?
Unfortunately, although I can't tell you a magic formula for pricing up and selling your items, I think there are one or two things that we can definitely use to help us see where on the scale of skill/hand-made v pricing we need to be.
If you make an item that people seem to snatch up, or you get a lot of orders for, it's pretty safe to assume that the price is either spot on, you've landed on a very saleable item, or lastly because your price for that item is perhaps a bit low, and they are taking full advantage of that.......

That's it for this section, I will finish this post next time.
It's an interesting, if somewhat mind boggling topic that is difficult to find a definitive answer to; but I will throw in the bits I have learnt. If you have any better insights than I do, by all means leave a comment; between us we may resolve the dilemma!

Well that was quite a serious post for me, I think I need a coffee >.<