Dylan Jahraus: How to Price, Plan, and Scale Your Product-Based Business with Sarah Johnson

Running a product-based business—whether it’s on Etsy, Shopify, Amazon, or through wholesale—isn’t just about making beautiful products. Success comes from the backend: pricing strategically, managing stock smartly, and making data-informed decisions. Yet many makers and small business owners skip these critical steps, often undercharging for their work, mismanaging inventory, or scaling before they’re truly ready.

In a recent conversation on the Etsy Seller Success podcast, Sarah from Flourish Retail unpacked the key strategies product-based business owners need to know to thrive in today’s market. With nearly 20 years of experience in high-street retail and a focus on helping small creative brands, Sarah brings a no-fluff approach to running a profitable business—even in uncertain times.

Here’s what every product seller needs to understand if they want to price confidently, scale strategically, and stay profitable in 2025 and beyond.

1. Pricing Isn’t Just a Number—It’s a Profit Plan

One of the most common mistakes product-based business owners make? Underpricing.

Many sellers base their pricing on what they think the market can bear—or worse, what their competitors charge—without truly knowing if it covers costs, let alone generates a profit.

Sarah’s tip: Start with cost-based pricing, which includes:

• Raw materials and packaging
• Your time (this is a big one most people skip)
• Platform fees (like Etsy’s 6.5% transaction fee, listing fees, payment processing, etc.)
• A profit margin (ideally 60–70% for DTC, to allow for wholesale margin flexibility later)

If you don’t include your time or overlook fees, your margin disappears. Sarah’s rule? “You wouldn’t expect a plumber to fix your sink for free—why wouldn’t you pay yourself for your time, too?“

And don’t blindly follow competitor prices. Many sellers are also undercharging, which doesn’t make them profitable—just unsustainable.

2. Don’t Ignore Your Data (Even If You Think You Don’t Have Any)

Think you’re too small for data analysis? Think again.

Sarah emphasizes that even a micro-business has data—it’s just about knowing where to look. At a minimum, track:

• Units sold per week
• Current inventory levels
• Stock cover (i.e. how many weeks your current stock will last at your current sales rate)

Simple stock cover formula:
If you have 100 units in stock and sell 10 per week, you have 10 weeks of cover. If that drops to just 1 per week, your product might be oversupplied, and it’s a red flag for slow-moving inventory.

This kind of insight allows you to:

• Reorder fast-sellers before they run out
• Mark down or phase out slow products
• Avoid over-investing in stock that ties up your cash flow

Even better? You don’t need fancy tools to get started—just a basic spreadsheet and some sales history.

3. Trends Are Useful—But Customer Focus Is Critical

It’s easy to get distracted by what’s trending on Instagram, Etsy, or Pinterest. But Sarah warns that external trends only matter if they align with your customer.

The real key to product selection, marketing, and even pricing? Customer-centricity.

“Keep a laser focus on who your customer is,” she says. “What are they buying, what aren’t they buying, and why?”

If you’re not sure:

• Use your sales data to spot patterns
• Ask your customers directly via polls or email
• Compare product categories against revenue contribution (i.e. does 30% of your revenue come from just 10% of your products?)
  

This helps you refine your range and avoid creating based only on your personal preferences. As Sarah puts it, “You’re not decorating your house for you—you’re staging it to sell.”

4. Understand Competition Without Imitating It

Yes, you should look at what your competitors are doing—but not to copy them.

Sarah encourages business owners to observe competitors for insight, not direction:

• Have they raised prices? Why might that be?
• Have they dropped a product line? Could it signal a fading trend?
• Are they offering bundles, value sets, or free shipping?

Use these moves as signals, not gospel. Your business is unique, and you may be serving a slightly different audience or operating with different margins.

5. Thinking About Wholesale? Here’s When You’re Ready

Wholesale can be a powerful strategy for scaling, but Sarah cautions against jumping in too early. “You must have margin before you pursue wholesale,” she says. That means:

• 60–70% profit margins on your retail pricing
• Accurate cost tracking (materials, labor, shipping)
• Reliable production processes (so you can fulfill larger orders)

While wholesale typically offers less margin than direct-to-consumer, it also offers increased volume, visibility, and growth potential. Think of it partly as a marketing investment—you may sell at a lower margin, but reach customers who wouldn’t have discovered you otherwise.

And remember: pricing for wholesale doesn’t have to follow rigid rules. You can (and should) negotiate fair terms that allow both you and the retailer to profit.

6. Scaling? Hire Smarter, Not Sooner

When it’s time to grow, many business owners ask: Should I hire? Sarah’s answer? Only if it saves you time or makes you money.

Look at what tasks are:

• Repetitive or draining
• Outside your expertise
• Slowing your business down

Sometimes outsourcing just a few hours a week of inventory management, bookkeeping, or customer service can free you up to focus on revenue-driving tasks. You don’t need a full-time team to grow—you just need the right help.

Final Thoughts: You Deserve to Be Paid

At the heart of Sarah’s philosophy is a simple but powerful truth: your business should pay you. Whether you’re selling on Etsy, scaling through wholesale, or launching a Shopify store, the fundamentals remain the same:

• Price with profit in mind
• Use your data
• Focus on your customer
• Plan with intention
• Scale when the numbers say you’re ready

If you’re not making the money you want, go back to your numbers. They’re not scary—they’re the map to your success.

To learn more about Etsy marketing tips, check out Etsy Seller Success podcast.

And don’t forget to follow Dylan on Instagram for more tips and behind-the-scenes seller strategies!