how to calculate your retail price

Updated: Jun 10

So you have your product and you're ready to take your brand to market... But how do you do price your product? Sure you have some kind of figure in mind but have you calculated your margins? Or understood your market?



Let's talk about how to calculate the retail price of your handbags with the Clutch Made team. Do you find yourself combing the internet to see what everyone else is charging? Do you ask your friends what they would pay for your product? If this is your logic for pricing, unfortunately you'd be wrong, and this decision could impact your business. When hearing the real cost of your bag, you should calculate and work out the true cost. Just because your are not coming in at the retail price point of Michael Kors, does not mean that you did something wrong. It means you are being realistic and a true business person in understanding the costs of making----and what those costs entail.


The biggest issues we find when costing bags, says Laura Dotolo at Clutch Made, is that our customers do not understand the amount of time that goes into making a bag or accessory—so they do not account for labor. Also, the client tends to forget all the details and pockets that they have on the bag---and how that can change costs.

Here is a basic list of what you should consider when coming up with your retail price point.


  • The time that it takes to make the bag (approximate hours)

  • Cost of labor where you are making it

  • Materials that you are working with

  • Cost of print work

  • Shipping of materials and final product

  • Your profit margin –is it 50% or 200%?


Once you identify everything listed above you will be able to make a pricing decision that is an accurate reflection on the cost, labor, time, work, material and margins of your product and for your brand. It's so so important to take care and time in this process. There is nothing worse than pricing too high or too low, as this immediately impacts your customers perspective of your brand and product.