How Do I Price My Furniture Business Profitably?

Pricing your furniture products correctly is essential for profitability and long-term success. Whether you’re a custom furniture maker, woodworking shop, furniture retailer, or upholstery business, your pricing strategy should reflect your costs, craftsmanship, and market position.

At Wexford Insurance, we specialize in helping furniture businesses protect their operations with tailored insurance solutions. In this guide, we’ll walk you through how to price your furniture for profit, covering key factors like labor, materials, overhead, and market trends.

1. Calculate Your Costs

Start by identifying all direct and indirect costs:

• Materials: Wood, fabric, hardware, finishes, and other components.

• Labor: Time spent designing, building, and finishing furniture.

• Overhead: Rent, utilities, equipment, marketing, and insurance.

Use a cost-plus pricing model, which involves adding a markup to your total costs to ensure profitability. For example, if a custom chair costs $250 in materials and labor, and overhead adds $100, you might price it at $600 to achieve a 50% markup.

2. Value Your Time and Skill

Artisan furniture makers often undervalue their time. If you’re handcrafting pieces, your pricing should reflect the uniqueness and time investment. Assign a fair hourly rate based on your experience and market value.

3. Research Market Trends

Benchmark your pricing against competitors. Are you competing with mass-produced furniture or offering high-end custom pieces?

Use platforms like the Etsy Seller Handbook on Pricing and Houzz Pro Pricing Guide to understand current market rates and customer expectations.

4. Choose the Right Pricing Model

Retail furniture stores may use keystone pricing (doubling wholesale cost), while custom shops may use value-based pricing. If you offer design consultations or delivery, price those services separately or bundle them strategically.

6. Set Your Profit Margin

Once you’ve calculated your costs, add a profit margin that aligns with your business goals. Most furniture businesses aim for a 30–50% margin, but this can vary depending on your niche and competition.

7. Monitor and Adjust

Pricing isn’t static. Track customer feedback, sales volume, and profitability. If you’re consistently selling out, you may be underpricing. If sales are slow, evaluate whether your pricing matches the perceived value.

Why Pricing Impacts Insurance

Accurate pricing helps you estimate revenue, which is essential when applying for business insurance. It also ensures you’re not underinsured or overpaying for coverage. Wexford Insurance works with furniture businesses to tailor insurance programs that match your size, risk level, and growth plans.

Wexford Insurance offers specialized coverage for furniture businesses, including:

• General Liability

• Commercial Property

• Workers’ Compensation

• Commercial Auto

• Equipment Insurance

These policies help safeguard your operations and should be factored into your pricing strategy.

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Final Thoughts

Pricing your furniture business isn’t just about covering costs—it’s about building a sustainable, profitable brand that reflects your craftsmanship and value. Whether you’re selling custom pieces or operating a retail showroom, understanding your costs, market trends, and insurance obligations will help you price confidently and competitively. If you're starting or scaling your furniture business, Wexford Insurance is here to support you with industry-specific insurance solutions designed to protect your investment and help you grow.

Contact us today.

Frequently Asked Questions (FAQs)

1. How do I get commercial furniture contracts?

2. What furniture equipment should I buy first?

3. How do I get sales for furniture business?