How to Price Your Laser Cut Products for Profit
Pricing your laser-cut products correctly is crucial for running a profitable business. Many makers undervalue their work, leading to burnout and low profits. This guide will help you set the right price so you can confidently grow your business while making a sustainable income.
1. Understanding Your Costs
To price your products properly, you need to calculate all expenses involved in production. Here’s what to consider:
Material Costs – Include wood, acrylic, leather, or any other materials used.
Laser Machine Wear & Maintenance – Factor in the cost of repairs, maintenance, electricity, and depreciation.
Labor Costs – Even if you're a solo entrepreneur, your time has value. Set an hourly wage for yourself.
Other Expenses – Packaging, shipping, software subscriptions, marketing, and transaction fees should all be included.
Pro Tip: Keep a spreadsheet or use accounting software to track your costs per project. Knowing your actual expenses makes it easier to price accurately.
2. Pricing Formula for Profitability
A simple pricing formula to ensure profitability is:
(Material Cost + Labor Cost + Overhead) × Markup = Retail Price
Typical markup costs range from about 2-3x, I will use a 2.5x for the following examples.
For example, if a product costs $5 in materials, $10 in labor, and $5 in overhead, and you apply a 2.5x markup, the final price would be:
$ (5 + 10 + 5) × 2.5 = $50 retail price
This ensures that you're covering costs while making a profit.
Markup Tips:
Use a higher markup for niche or custom designs
Adjust markup based on the complexity and uniqueness of the item
3. Real-World Pricing Examples
Let’s say you’re selling custom engraved tumblers:
Material Cost: $20
Time & Labor: $10
Overhead Costs: $5
Markup: 2.5x
Final Price: $ (20 + 10 + 5) × 2.5 = $87.50
Or a layered nursery sign:
Materials: $12
Labor: $20 (design, assembly, painting)
Overhead: $5
Price: $ (12 + 20 + 5) × 2.5 = $92.50
These examples give you a baseline but remember to customize pricing based on your brand, audience, complexity, and skill.
4. Adjusting for Market Trends
Competitive Analysis – Research similar products on Etsy and Shopify to stay competitive, but don’t undersell yourself.
Premium Pricing – Use high-quality materials, offer personalization, or create bundled products to increase value and therefore price.
Seasonal Pricing – Holiday-themed products often allow for higher pricing due to demand and urgency.
Think About Perceived Value: High-quality photos, detailed listings, and excellent customer service all allow you to price higher.
Let’s stay connected!
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Shop Products and Shop SVG – Browse my laser-cut designs and digital files.
Instagram – Behind-the-scenes and community support.
Website – Explore my other blogs, free guides, and courses.
The SVG Society – Access laser-ready designs that match your unique style and help your products stand out.
Turn your passion into profit and take the first bold step toward your dream laser business today!
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