Pricing - Time

[jowshu98]

I'm close to landing what I think is a nice deal. I haven't sold any of my stuff before and was looking to do some small bazaars to start out. However a business in the area wants to possibly purchase 500+ ornaments to pass out to customers (perfect timing as I have my eye on a Grizzly bandsaw for resawing!!) I have looked at several of the posts on here and Kevin and others sure have a lot of good information which has helped me so far. I have inputed JediMaster Kevin's formula into excel so I can run different scenarios which has helped immensly! My problem and question revolves around the time factor in generating a price. Typically when I'm cutting I don't worry about the time and with retail pricing I know I was covered. In tying to work up a wholesale number I'm concerned about whether the time it takes me to cut something is too long. It would be interesting to do a comparison between scrollers on the time it takes to cut something such as an ornament (say something like the candle and wreath ornament by Paul Meisel on page 102 of the 2008 Holiday edition - which I am not cutting it's just similar in complexity to what I'm doing). I know eveyone is different but it would sure help to have some sort of baseline to know whether the time it takes is really off. I'm averging about 25 minutes stack cutting (5) 1/8" BB ply which seems long to me when I run the numbers not when cutting. My problem may be more in trying to hit a price point than anything else but it's hard telling not knowing!!

Sorry for the diatribe, just want to make sure I'm not selling my self short.

Thanks again for all the great info!

[ncsealeveler]

Kinda hard because of all the variables but good idea.Tony

[KtownScroller]

OK. 25/5 = 5 minutes each. I don't know how you can beat that cutting time. Where you are going to get killed is with the sanding and to some extent the finishing.

So costs are:

Wood
Blades
Electric
Sandpaper
Band Aids
Polyurethane
Delivery
and TIME!

Personally I would never cut ornaments and finish them UNLESS you made at least $5 profit per ornament. Now if they only want you to cut them and lightly sand them you might be able to lower the cost. Realistically you need to say to yourself is cutting 500 ornaments really worth it? Somehow I think you already have... that is why you are asking. I wouldn't do it. Think of the plumber who shows up at your house and charges $70 upon arrival. Now how hard did he work for that $70? Do you really want to kill yourself to make a little money on 500 ornaments? It's your decision. It's just not something I would want to do.

[JohnB]

I'm sorry, I know Kevin does a Retail and wholesale price, but when you are the manufacturer, marketer, distributor and retailer, I can't see how the 2 prices can differ.

You have an amount you need, want, require and that is what the piece is worth no matter to whom you sell it.

[Jediscroller]

At that amount of time I think it could be quite profitable. I had a customer who used to order 200 ornaments every year from me and I would typically sell them to them for ~$1000. It was good for them and good for me. I do similar except I use hardwoods. Ornament times vary widely for me but 5 minutes sounds excellent.

[Janette]

Originally Posted by JohnB

I'm sorry, I know Kevin does a Retail and wholesale price, but when you are the manufacturer, marketer, distributor and retailer, I can't see how the 2 prices can differ.

You have an amount you need, want, require and that is what the piece is worth no matter to whom you sell it.

For me John, the difference between retail and wholesale would be the fact that I don't have to pay for a show, drive out, set it up, sit there for a weekend and pay hotels/food, etc. Which adds up. I lower my price some for the pieces in a gallery because #1- they double the price and I want them to sell. By taking a bit less (not 1/2 or anything like that - simply a few $ less/hr)

My nuthatch for example: I sell at shows for $75. It used to take me 4 1/2 hrs to make one. I can still easily sell them for $75, but now it only takes me 2 1/2 hrs. For this particular piece, I can easily afford to provide it to the gallery asking for $55 from them so they can sell (which they do) for $110. They make their money, and I'm still ahead of the game.

[jowshu98]

Thanks for all the great input! Already dipped into the bandaid's last night - knuckles and benchtop sanders don't mix well I'll need to factor in some neosporin as well . Janette makes some great points in regards to the offset of costs with show fees, setup time etc. I'm also looking at this as somewhat of an opportunity to get my name out there a little bit and possibly get some additional business out of it but I'm not letting that factor into the price.

Here's how I'm figuring it so far using Kevin's formula:

.33 per minute x 25 minutes on average (I'm using 6 different patterns and timed each)= $7.50 labor

material costs per ornament ply etc. = ~.25 each @5 per stack = 1.25
time + material = 8.75 + 30% profit margin = 11.38
11.38/5 = 2.28 price per ornament (+4.00 for neosporin and more bandaids)

Is my math sound or am I missing something?

I'll be negotiating with them tomorrow on this and hopefully it works out; I'll probably have to lower my hourly rate some to get it but we'll see.

Thanks again.

[Jediscroller]

Ummm, I get 8.25 for labor at 33 cents a minute ((33 X 25) / 100). This works out to 2.47 each. I would try rounding up to $2.50 (or even $3.00 if you are planning on "negotiating.") I'll leave your hourly rate up to you. 33 cents a minute is about $19.80 an hour which I think is a pretty good deal for a skilled craftsman. I forgot to forewarn you though, you will be thoroughly sick of cutting ornaments.

[jowshu98]

Oops. Was playing with the hourly rate and didn't catch it. Thanks! I know I'm going to be sick of ornaments but it's easy money. It's going to be tough since muzzleloader season starts next Saturday, guess I'm going to have to get one opening day so I have time to get them all done if we come to terms.

I typically cut ornaments out of hardwood for family and friends. Price was a factor for them and my wife works there so want to be fair all around but not lose my shirt.

Thanks again everyone I'll let you know how it goes.

[tcscroller]

Hi--------now my brother who used to cut plaques many years ago changed to cutting only ornaments-------the plaques he found were hard to sell and ornaments at 5 ---7---and up go well and people will shell out that kind of money before they hand over 75 and up----in just over 10 years he made around 35,000 dollars----------not a lot of money if it was your main income but as a hobbly it paid for some extra items around the house and holidays and such----------now me I mostly do plaques and they are indeed a hard sell so I also do ornaments and puzzles------in short if you plan on ornaments and you go to places where there are lots of people then the small 2---3--5--7 dollars soon add up ------so don't give up on just ornament for your main items----as Kevin says you might get sick of cutting only ornaments but it depends on where your priorities are----------are you doing it just to make a few dollars now then quit later or are you doing it to make a few dollars to cover your costs and a little profit and look back years from now and say yes I did some good work and its still around for years to come-------little bit of an ego thing perhaps -------in my experience if you just want to cut and get rid of it and make a money then all that time seems to be a little bit of a waste since perhaps you could make more money working in a factory with no worries except that the company will still be in bussiness years down the road----------we all need some sort of hobby or activity apart from our main work and scrolling to me is just about the best thing anyone can learn and really enjoy life that much better-------------take care and happy scrolling--------Tom