i do all my custom work the same way i price my retail, consignment, and wholsale items. (cept they cost a bit more since im making it especialyl for the person, but they know that going into that since they have to fill out a LONG order form on my site!)
price is based off of the wholesale price, which is then doubled for my retail (also my consignment price). So using yarn as an example:
price of materials+time+extras
materials is anything that goes into the product- any fibers, beads, buttons, etc used to make the item.
time is the wage you pay yourself- i pay myself what i can make in my state if i worked min wage, so about 6-7 per hour. this includes time for website updates, driving to the po, etc, not just the actual production.\
extras is a small add on charge you add to the item for any overhead- that is required for tools, upkeep. etc. i dont realyl charge an overhead since i jsut calculated a negligable amount into my materials.
so...if my materials cost is $1/ 50 yard skein, and it takes me 1/2 hour to produce it (conservative estimate, i dont ussually count all the time i spend on my business or my prices would be through the roof), so thats $3, plus no extras. so my wholesale would be $4, retail $8.
I have an excel program set up to calculate most of it for me and jsut add on any extras that arent in the usual skein of yarn. also, my shipping charges are claculated to include the costs of shipping materials, priniting, etc. These are not included in my retail price b/c i do some "brick and mortar" sales as well as consignment.