Project Cost-- Pricing

[Jay Caughron]

That was some very GOOD advice Carol....

[allen levine]

so I learned something from all of this.

[larry merlau]

what was that allen that a woodworker may not be a good business person

[allen levine]

no, it you examine carols pricing structure, seems sound.....a decent model to work with.
unfortunately, I dont think it will work in the woodworking world for 95% of the people who try to make custom stuff.
rounding off using carols method, your cabinet would fall in the 3000 dollar range.
Not happenning, not there, not here, maybe 1 in a hundred will get that price.

I feel as Ive felt for the past almost 6 years since I started with all of this, woodworking is a tough way to try to make a living.

as I dont believe the argument, well, Ill just make enough to support my hobby, eh.

Im sure with enough time and patience, some will turn over enough profit to earn a decent living.

I think commercial work, as in doing retail stores, offices, there, custom work will pay so much more, but ofcourse that is basically carpentry, not real furniture stuff or building custom things.

[Carol Reed]

You are right, Allen. I specialized in a very tight niche market. I marketed there in terms the customer understood and was willing to pay the price. Getting rich was never an option. Keeping the bills paid was the goal. Managed that for a little more than 20 years, but it was supplemented with writing a book, teaching and public speaking around the country. When I was younger, I thought about growing bigger, but jumping in with employees, more shop and tools, insurance, and a greater administrative role was not appealing to me. That is a quantum leap and while it has it merits, it also significantly impacts the role the owner plays. As for my methodology, I kept tweaking my spreadsheet, until the thing that took the longest was counting the number of parts and inputting the costs of materials. Then I had to sell that number. Only one customer backed away and 8 years later asked me if I could repair the schlocky stuff they had purchased from a catalog at about 1/3 of my bid. Of course, the answer was 'no' and no counteroffer to build new was extended. There is not enough time in the world to deal with stupid and cheap customers. You either valued the product you planned to buy or you went elsewhere.

[Stuart Ablett]

......There is not enough time in the world to deal with stupid and cheap customers. You either valued the product you planned to buy or you went elsewhere.

Boy is that a lesson that has been earned with a lot of hard days work!

I heard it put thus....

"You get 80% of your business from 20% of your customers"

In the liquor shop business this is so very true. Those 20% that give us 80% of our business I will bend over backwards while on my knees to make sure things are good. The 80% that give us only 20% of our business are almost always the biggest pain in the neck too. Them I don't really care if they darken my door again.

[Karl Brogger]

When I get something I don't think I can safely bid, I do time and materials. Charge what you think is fair. I use $50/hr as a shop rate, but I typically mark up material and hardware 100%.

Regular production I shoot for about a gross of $100/hr per man. So a $1000 job should take ten hours or less. Sometimes its way better than that, sometimes its horribly in the wrong direction.