The theme of how to price your work appears on the Woodworking Forum. Everyone has a different view of how to do it, and unfortunately they are enough.
When I first started building furniture, I was happy to spend a few dollars to pay for the material and left a little to buy new tools. After all, at that time, woodworking was a hobby, not a means for the family. Pricing my work in this way is a great way to build my experience and add to my collection of tools. It has no side, I have never really done what I call "good money", at least not enough to make up for the time I spent on each project. I told myself "This is just a hobby, I am still learning crafts, and I am not a professional, so why would someone pay the full price for my work."
However, this makes me think about what is "full price" and how do you decide the full price of custom furniture? When I decided to sell my work more seriously, I had to answer this question and come up with a better way to price my work.
At the time, I was still working for another company, selling people as floor sales products. In my sales position, I paid by commission. This commission is calculated based on the profit margin of each sale. Of course, I started using the percentage marker to calculate my pricing. Most of the products I sell at work have a 50% markup, so I use it as a benchmark for my pricing.
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This method is useful when I build furniture from moderately priced wood such as walnut or maple. However, when I built things with cheap wood such as pine trees, I invested very little time. On the other hand, when I used a more expensive alien species to build a project, the final price was very expensive and it was difficult to prove that my client was reasonably priced.
To solve this problem, I decided to calculate my materials and labor separately, and then calculate my workforce by hour. The challenge I faced was to determine how long it took to build each piece. As a custom furniture manufacturer, I rarely make the same piece twice, each with varying degrees of difficulty. A bed can take up to 30 hours to make, and the next bed can have a ton of spindles that can be cut and takes 50 hours.
Obviously; I need a better benchmark to measure how long it takes for the different woodworking processes I use to make furniture.
To create this benchmark, I tracked how long it took to complete each task while building the project. For example, how long did it take me to cut my eyes and hoes, polish and smear finishes, and so on. Now, I know what you are thinking. Blinking for small spindles takes less time to cut than blinking on large bed legs. What I am pursuing is the average. For example, how long does it take me to cut my eyes and match the hoes.
If I averaged all the blinks and gimmicks last year, I think I can say that I can cut another one at the same time. The key to getting an accurate average is to track the time of as many items as possible. The more data you build, the larger the data set you have, and you can more accurately estimate the time it takes to build different projects.
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Now, my bid is more accurate and fair to my clients and myself. Once I have completed my store drawings, I will calculate all the blinks and gimmicks and multiply them by my average time and hourly store rate to determine the cost of the project. I do this for all the tasks I need to complete the project, adding them along with the material cost. Then I got an accurate quote.
Now, the only problem I have when developing this pricing structure is the hourly fee. I believe everyone wants to earn more than $100 an hour, but if you are not a well-known woodworker, like Sam Maloof, he can sell a chair for $10,000. You may need to set a lower hourly rate. Be honest with yourself and ask yourself that you will pay for your work at an hourly rate. Insert this number into your formula and compare it. Look at other furniture manufacturers in your area that are charging for similar designs and quality. Then ask yourself. Are you at the stadium? Can you prove that the price is higher and the quality is better? Can your target market bear the fees you charge?
If your price is much lower, then you can afford a raise. On the other hand, if your price is higher than the market price, you will have to determine the reason. Is your expectation of the reward you want to be true? If so, you may need to find a better process to build your work faster. Maybe you need a better and longer chisel to reduce the time to sharpen. Maybe you need to look at your professional ethics. When you work, will you be distracted by SMS and Facebook notifications? Efficient work will always maximize your profits and time.
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Adam Savage from the rumor terminator once said, "The only difference between science and distortion is to write down the data." So don't panic, track your time and materials, and organize Data to create a benchmark that can be used for accurate pricing work.
Orignal From: Customized woodworking pricing strategy
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