The LAST pricing formula you'll EVER need! | Maker's Money
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- Опубликовано: 22 май 2024
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This video is about our ultimate pricing formula. How to price your work, how we charge for labor and materials, and ensure we have markup, margin, and profit leftover. We hesitated when we first started selling our work and it really hurt us. You don't need to know everything about price to make a profit! Spend your time selling, not doing accounting.
Time Stamp
00:00 Terrified of pricing
00:38 Betting me paycheck
02:12 Intelligence is not a requirement for wealth
03:19 Jump off your diving board
04:25 The ultimate pricing formula
09:12 make money every time
10:08 Get outside help
10:48 Outro
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We're Jennie and Davis. We love watching people grow. That includes you! Join us as we learn to build a furniture business. We want to help people dominate their fears and weaknesses. You can learn from our mistakes ;)
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My dad had a successful machine and welding shop. He said that if there isn’t 10 to 15 percent of the customers complaining about high prices, you aren’t charging enough.
one of my machinist instructors at school used a similar formula for cost estimating. material plus labor X2 then, X2 for good measure. and then you can cut the price from there lol
Lol! Intelligence is not a requirement for welth." Best quote ever.
True. My last business however was a sawmill. People normally try to get as cheap as possible that’s understandable. Ive had customers tell me I’m selling my lumber too cheap. I would agree but watching what other mills charge I followed that BECAUSE of the cheap thing although my lumber was superior to other mills i wasnt able to raise my prices above theirs and guarantee sales. Business is fickle
The key to remember is, they came to you for a CUSTOM piece! If they want cheap, they can go to the big box store and “settle for”!
I didn’t think this would work, so I flipped to side tables, painted them and replaced the hardware and priced it according to this formula thinking “we’re not going to have any responses. I would NEVER pay this much for them” . They sold the same day and had a ton of responses, hahaha … thank you guys!
The best advice I was given when going to to business, you can't ask for more but you can always give a discount. Plus customers always prefer you come in under the number you quote not over. So use this formula, see what number it produces, then decide if you can''t charge this much then your business isn't viable, you can't do it for less so either do it faster, use cheaper materials, or sell it better, otherwise don't do it at all.
This is fantastic! I just sold my Roubo split-top workbench that took me 500 hrs to build for $25,000! A profit of $8,000! That was my first and last customer. I’m out of business now for being overly confident.
I LOVE the look on peoples faces when I tell them "You can always buy the one at Wal-Mart" when I won't come down a price I've quoted them!!
This is funny!
I bet they are thinking but i wanted custom made. Well Yeah, that's why is more expensive because it's custom made to your needs and Handmade
Head slap. What an elemental and perfectly applicable formula. I have been building for years and will start using this formula (and maybe even revisiting old invoices!). The biggest problem in my eyes is that custom building projects CAN NOT be cost compared to mass produced products from overseas. Unless you are in a race to the bottom (you will never beat Walmart). That said, makers must produce products that have other advantages (better built, customization, personalization, accessibility, etc.). Thanks guys for another fun/useful video.
Go watch the very first video in the Maker’s Money series. We address that topic head-on!
"Race to the bottom" is exactly right. Reasonable people understand that quality is a distinguishing factor - for better or for worse, i.e., poor quality is worthless, regardless of the materials used. Unreasonable people who do not understand this are not going to be valued clients, so I wouldn't spend much time trying to convince them. Chances are that both of us will ultimately be unsatisfied by some aspect. J&D address that in one of their earlier vids.
I appreciate this very much I have been stuck in a rut ever since I was basically fired from my first job. The client wanted at first to build a brand new shed an tear the old one down. I gave an estimate for that and they decided they wanted to just redo roof and put new siding. Then that estimate was pretty close to the original because pretty much same material needed except for the 2x4. Then they decided to go ahead and rebuild it. Which then in my confusion I ended up losing out on some labor. Well I finished the framing and the trusses installed and was halfway done with sheathing and I had a doctors appointment which they decided was not going to get it done. I lost a lot of money on that one.
As a customer recently told me: “custom products = custom prices”
This is great, it's worth remembering that time for consultation, design development and actually sourcing materials should be factored in as well.
You should also take a down payment before you start work on any custom job.
Whenever I make something custom, I ask for a downpayment of the material costs to produce it, that way I'm not buying the materials out of my own pocket.
Have a better day!
I always ask for 50 percent so part of labor is included
Doesn't that also incentivize their purchase ability and make the pill a bit easier to swallow for them?
"5 EASY PAYMENTS OF 99.99" is a thing for a reason.
As long as you aren't a shady salesman I feel this works for both parties.
@@CFChristian no. It’s custom hand made furniture. 50 percent down to cover you in case the deal goes sour. Human behavior cannot be underestimated.
I will never forget the time almost 4 decades ago when I was in my friend's kitchen. He hauled up this huge box and started unwrapping it. I said... 'What's that?" he said "It's a coffeemaker. New advanced technology." So I said, "Wow, that looks cool. Is that a good model"? to which he replied, "It's the best one they had!". I thought about that for a minute and asked him "What made you think that?" I was thinking maybe a magazine review or something like that. I will never forget his answer. "It has to be the best because it was the most expensive one."
Some people really believe that, and to people like my friend, the more you charge the more attractive it will be.
What a great video! I have been trying to wrap my head around what I should be charging and not what I'm settling for. The prices just went up! Thank you!
I've been following your advice and I'm selling more than ever! Thank you so much!!!!! ❤
This is awesome. Tried figuring how to price and there was so many different ways by different people. I’m definitely going to try and use this one for my stuff. THANK YOU!!!
This is the most helpful video I’ve ever watched on pricing for my business. Thank you so much for this!
this is pretty much what i use and the nice thing about the multiplier itself is it also accounts for any under estimations, or problems that come up in the process of making the thing
Nice simple way to do it. Provided you know your costs well, this should yield ~33% gross margins which is pretty spot on for a healthy business.
Thanks guys! You really solved my problem on how to price my sofa business. This will be my first business and we will open our store for the next 2 weeks. :)
This is exactly the formula I used for years in my sign business. Great Job on the video! And a very good way to Illustrate your point in the beginning of this video to make your point clear and understandable. We’ll thought out. Keep up the good work.
I agree 100% with everything mentioned in this video. After I get paid on Friday I'll be buying a dewalt job table saw and miter saw and looking to get started in woodworking. These videos are great! Thanks for sharing
Im just starting out and seem to have lost on every job. THen this seems to be very high. Confidence is much needed. Thank you.
This is the first I have ever seen from you two and I must say, keep it up. Your ability and form of teaching are fresh, to-the-point, and enticing. As others have said, some of your quotes I have never heard anyone say: "Intelligence is not a requirement for wealth", but I vibe with 100% and have even thought similarly before. Keep up the amazing show, you have just gained a subscriber!
Thank you.... I over think things...this was very helpful... I saw my self on the diving board pearlized to move forward..
Thank you for this. I was over thinking.
Thanks for the insight on this video! Nothing good is easy, and this is good stuff you both create.
Thank you guys for this great content! I know this takes time and money, so thank you!!
Great video!! Tyty. Informative, fun, and energetic....great!!.
Thank you so much for the financial confidence boost, I’m about to start building furniture and didn’t know where to start with costing, this will help heaps
Cheers from Aus
Great advice! I watch your videos every week!
Thank you for the inspiration and help!
Thank you for making this video. I've been struggling with pricing my projects for a while now. I build custom subwoofer enclosures. Depending on the type of finish I can usually get these done in 1 day. Using your formula gets the price close to what others are selling for online. I've been doing charity work as you said. This is much appreciated.
Keep raising prices! You probably offer a lot more to the customer than some stranger on the internet can! Customer service, no shipping problems, custom sizes, etc.
very blunt and practical. guess this is the first time a video has ever given me a hard slap and brought me back to reality.
Subscribe! We’re full of that kind of stuff!
That’s was a FANTASTIC video!
My formula is very similar. Mats + hourly * 1.25 for monthly bills then another * 1.25 for profit, then if I'm selling at a craft fair I might add another 50-100% for fuel and also time away from the shop that I'm not making things to sell.
But I like the 1.5 thing. That will save me a step. ;)
This is exacly what I was looking for! Starting my first custom project this week and I wanted to know how much to charge. Left a sub
I'm only a student and building for family and friends and I've already WAAAAAYYYYY undercharged for pieces I've built and it sucks, gonna try this and hope I can actually implement it.
100% agree. Great vid. Simple formula but it works.
Very sound advice, thank you for sharing.
Thanks!! This helped me out greatly!!
Wow, great video!
Thank you for sharing your video and for the information.
Thank you!!!! This was and has been such a pain for me to figure out! I’ve been in business for a year a haven’t been able to come up with something this comprehensive. I honest to goodness tried to factor in the cost of glue, tape, and sanding belts. Lol
Been using this type formula for years. Works quite well.
What a simple solution to figuring out cost. I think I will try that with the client build.
Much needed thanks guys great advice 🙏
“Build it faster, or find a new customer”. I love it!
There are people that understand what goes into a project, and there are people that say "well I could do that cheaper". You want the former ones as your customer and run fast and far from the latter.
in manufacturing industry people tent to bellieve big clients to be important customers and offer sharity to them. in a way it can be sensible if you trade secure (not imaginary) deals out of it.
All good comments below. I would add one more especially for those just starting out. If you start your pricing low it is much harder to raise your prices as word gets around about what you can do. By starting higher you don't have the burden of trying to figure out when and how to raise your prices.
A different/ better angle on what I've been doing for a looong time.
I like better. Alot.
Thanks
Great advice! You guys rock!
My parents bought a dining room table and china cabinet custom made out of Cherry from an older gentleman (mid 70's) for about $5,000.00. This was back in the mid 80s and that was a big chunk of change for furniture. Every time I go to my moms for a visit, we sit around those same pieces, 40 some odd years later. You get what you pay for when it comes to hand made custom furniture, why would you expect to pay less and get more? It just makes no sense.
Wow, shows also the impact your effort can have. 40 years later those pieces are still where you all come together
$5,000 in 1985 is equivalent in purchasing power to about $12,915.80 today.
@@duderguy1571 That’s actually a decent comparison time and price wise.
@@duderguy1571 wow! Not gonna lie that’s a lot of money… for a table… a lot of money
i am greatly amused right now. i just found this video today but i was thinking about this subject for about a month before now and just yesterday i finished my pricing formula. it is exactly the same.
the thing i realized, and in turn allowed me to finish my pricing formula, was that with what i do know how to do and my skill at doing those things i am worth that hourly rate. and believe it or not, so are you. the first few times you sell some things at that price it will be uncomfortable. however, when you get the first sale and then get more sales at that price, you will get more confident and more skilled. then your magic multiplier will increase. and more money is rarely uncomfortable.
Awesome episode, and awesome anecdote also!! Im new and trying to figure all this out also....
This was really helpful!…..Thanks!
Great I learned about this 😊😊 thanks 🎉
I really hade this problem, which is pricing the items that I made for the customers. It is really annoying me alot. But I think your video for today will help me for that matter.
For all the perfectionist, a quote I heard recently. "Perfection is the enemy of good enough." Perfection of course is a relative term.. I am a recovering perfectionist... As one's skill and efficiency increase "perfection" becomes less of an issue.
Thanks J&D
Nice little vid. There's really no way around any of this and it's as simple as it can reasonably be.
Thank you!
Thanks for this video.. this exactly my problem but I will use this formula.
Thanks for sharing and advice, that formula is a good start step, and after that someone can improve that with others Multipliers, for example, i´d multiply the (Material Cost x RISK to Mess Up).
Howdy (again 😀)
Just found your "Maker's Money" section of videos. Damnit!! I've got stuff to do and y'all just made me binge watch your playlist 😂.
I'm one of those "types" that think my skill/product isn't good enough, no one is gonna buy this. My friends and family have always told me my stuff looks great. But I always thought, well they're just saying that not to hurt my feelings. I see the flaws in what I built...there's a check in the wood here, the stain isn't even, it's a 32nd out of square, the 45 doesn't completely seam to the other 45....are you guys blind. But, they never see those flaws, only me.
So, I have low self confidence in my own skill cause it's not "perfect". In 30 years of woodworking, I can't think of a single project I've made that was ever "perfect". So, I never thought people would buy anything I made.
Watching your videos has given me confidence. I am the reason I never tried.
Thanks for opening my mind.
Thank You and God Bless you.
Thank you guys so much! I've been struggling with trying to figure out pricing on the things I make. Almost to the point I was thinking of not making anything ever again.
Thanks for your great insight on this topic. The formula makes perfect sense. My issue is that I take a lot longer to build items because of the inefficiencies in my woodworking. I tend to be a perfectionist and always find myself repeating steps to make the project better. Therefore the project that should take maybe four hours total ends up 8 to 12 hours.
Thanks for sharing. Felix
Hey Felix. What helped me (Davis) in this area is to work backwards! Nail down a budget from the customer, then work backwards using the formula (and a little algebra) to find the maximum amount of time you can spend on the project! Then do your best to stick to that.
I often joke with family/friends and say that I went into ministry because I don’t like math and we don’t do math in ministry. This is definitely some math I can understand! Thanks for helping out someone new to woodworking!
Excellent 👍
Great insights!
I'm a little leery of using this formula tbh given how I am just starting out and feel like my work is too novice as of yet. But I will give it a shot and see what happens since I will be attempting to batch make planter boxes as my first project to sell. I made a few prototypes and I will say my second planter box I made was made *much* faster then my first one. So maybe more practice and speed that will help keep labor costs low. Thanks guys, I took some notes and I'll be visiting your other videos here soon.
Lack of confidence and salesmanship is the bane of my capitalistic craftsman existence. Thanks guys. Got my sub.
Chris! Join the Stud Stack!!!! Confidence is like a hot coal. If you’re with others, you’ll get more confident. Spend time away from the fire, you’ll start to lose your heat!
This is a must, I’m a handyman/furniture maker/kitchen fitter etc. started using this formula a few years ago i now win approx 56% of my work bids but make a ton more money.
Yes! Stu gets it!
Great video, very helpful, I made a new table base for a friend a while ago and afterwards I got to figuring that I made all of like $5 an hour on that project. They were moving and the original table base fell out of the back of their truck when they were backing down a steep driveway and it got run over so was asked if I could make a new one for them. A few years ago I was contacted by a woman who asked me to make a couple shelves for her, it was a complete nightmare and she was such a pain o work with. In the end I made no money, if anything I think I lost out on that one just from the labor and the headache that she cost me 🙄. Thanks for sharing this video, it was definitely beneficial for me and I’m sure it was for a lot of others as well.
so you just wanted to vent. cool
@@pekitas I wasn’t just wanting to vent I was just wanting to share some of my experiences. The table base I didn’t have any problem with how much I got paid because it was for a good friend but the lady that I did the shelves for I should have just dropped them off on her door step but I didn’t want to get a bad reputation from having a lousy costumer.
Friends are the worst for keeping your sanity an price where you can make it worth while /just rember people when you get your auto worked on you pay /an the friends have to pay / this is the way you make a living !
I also add the "intake cost" into my labor cost. The time you make taking the order...
This is totally off topic, but I love the intro theme song. I dont know why, it's just fantastic.
Good advice!
Simple and easy. I had spreadsheets that calculated bf for projects materials and supplies etc. At the end of the day it was close and took a while to build. It was a useful learning experience when shop time was slow. Key learnings, use a day rate, forget the hour rate. How many days will this take you to build, or how many can you build in a day. No one works 8 or 10 hours straight. Boils down to time and materials. In my experience the 1.5 is a close estimate for the extras that you run into, overnight changes in materials, mistakes, wastage etc. Some you under estimate others you over estimate, but you don't waste time thinking about it. For me it is closer to 1.65-1.75, this also allows some flexibility for a "discount" price that people look for ... now you can give without your business losing money. You can always say no to anything and anyone.
Good video.
This is good to know because people always ask me to build things for them and refinish furniture. And I'm a very green woodworker but apparently I do a pretty good job and I always have no clue what to charge someone.
Toughest part of any job imo. Pricing.
I wasn't far off but this is definitely more profitable than what I was doing... (materials x3) x hourly = total. Thanks ill write it down moving forward
I just heard basically the same thing from a successful businessman a few weeks ago. His formula was parts + labor × 5. His company has been out of business for several years but he and his partners are all millionaires now.
You’re right I don’t like the formula AND I’m scared, but I NEED it.
I like following you young go getters. Certainly agree too many people are working for free. You can see cutting boards for $35 on- line. My formula is materials x2 + $50 per hr.. Good luck have fun work safe!
This is literally inputs X overheads (tweaked with reinvestment profit) it's actually really smart
4:30 TLDR (Material Cost + Labor Cost) * 1.5 = Sales Price. 1.5 is an arbitrary multiplier to generate profit, account for wear, your experience, etc. Scale the multiplier accordingly.
That distills it down too far, and ignores further details about expansion, but hey.. I look forward to you dumbing down more videos.
@@lokidecat you can lead a horse to water but you can’t make him drink… you can only hope to make him thirsty… 🤷🏼♂️
You just spent the first 3 minutes describing me... 😆 less think, more do! ✌🏽
Awesome video! Thank you for sharing this. My biggest fear is telling somebody what the price is cause people try and compare handcrafted work to cheap factory produced junk online or in big box stores. And that drives me up the wall y’all.
If they are comparing your price to mass-produced junk then they were not your clientele anyway.
I’ve been doing cabinets for over 30 years. I work for a cabinet shop. But I have done many side jobs thru these years. Everything you talked about is to the tee. I underbid myself thinking I wouldn’t pay that much for that pc. Of furniture. Finally I decided to charge for what I think what I am worth. Clients don’t even bat an eye. As long as you can deliver.
Is the labor cost in-line with what is paid to hourly employees in the cabinet business?
@@TheGrumpyChef no, I price closer to what my company charges per man hour to keep the doors open.
very well explained and well displayed. But too many young or newbees forget the minor materials and things like utilities and advertising and business cards even shop rags etc. Also there is the business principal called alternative use of your money, that is what else could you use that same money for. Maybe you could make two end tables for the same cost( $650) and sell each for $600 therefore realizing more profit : it is very fair to charge $975 for this piece. Labor is the most expensive item in any service or hand made enterprise therefore if it is not factored in properly then losing money is inevitable.
I personally do materials cost, plus labor time. Labor time also includs shopping time for materials. I shoot for at least $50/hr. Definitely a BARE minimum of 2.5x materials cost. Sometimes it's more.
Thank you SO much for the vid! Do you find this to be an industry standard? Watching your vid I was curious to know whether do Market Basket Testing of your competitors with similar products and take this in account? I know I am one of those overthinkers (analyzers) become before becoming disabled I was in a different industry where a similar formula was of paramount importance.
Great video!
Too often we price our products at a level, we feel, that potential customers won't turn down. When a customer says, no, to buying your product, it feels like rejection. Of course, this is ONLY in the beginning, because when doing business this way, there is no business after that.
If we ask ourselves this question, or something similar...When starting a business, was everything needed, like materials, location/shop space, tools/equipment, etc, purchased at prices that couldnt be turned down? NO! Full price was paid. And that's why the businesses that sold all those start-up products is still in business. Sure, everyone likes a bargain. But not everything is at a bargain price and not all bargains are a better deal.
Purchasing a great product is usually the best deal.
I’d like to see you guys do a video on how you remit your quarterly state sales tax and how you factor that into your equation. Also how you can use your EIN to purchase materials tax free. I think that would be super helpful.
That's advanced level stuff - not really great RUclips material... Join the Stud Stack if you're in this deep!
I have been using this formula for years and it works well. The issue I have is the quality of work that s being generated. A lot of these comments say how much we would be surprised how much people pay for quality work, but of the same formula is used for "less than" quality work, it kinda muddies the waters. Would I like to be charging the same amount as Michael Fortune? SURE! Can I? No way. The difference is going to be in the magic multiplier. Where Michael Fortune can set his at 5 times, I can probably stick with 2/2.5 times.
Good video, though.
You have to know when to FIRE YOUR CUSTOMERS. They are often ready to fire you over very minor things.
I saw a comment a while back that a customer was trying to get something built at cost of materials... I told the person that is not the customer that you need. Fire that customer NOW and dont waste anymore time on them. The more time you waste on that customer the less time you are spending on finding that customer that will pay you.
I'm in metal working. And we use a 3 multiplier but and go as low as a 2 multiplier. For beginners I like the 1.5. But that would have to increase quickly.
So the formula they are providing is an industry standard, and your organization's X3 or X2 is an industry standard as well?
@@TheGrumpyChef I think it is pretty standard. I work for a commercial general contractor and the way we bid jobs is to estimate our labor and costs, add it to subcontractors pricing, then add a "fee" on top of that which is a percentage and depends on how aggressively we want to bid the job. if we really want the job, we go with a 1% fee, if we don't want to be as aggressive, maybe we go to a 2 or 3% fee or higher if we think we can. So a 1 Million dollar job would net us 10,000 in overhead and profit at a 1% fee. From a woodworking perspective, just like in other sectors, supply, demand and name recognition can alter the percentages, but that's not something beginning wood workers usually need to worry about.
Never be afraid to ask for the money
We run a Jewelry business - both our own fabricated product, as well as others (wholesale). The best advice we've followed is to remember we actually are running *three* businesses - Fabrication, Wholesale *and* Retail. As you recognize in the video, Fabrication costs are materials and labor, and "some" amount of overhead to cover utilities, tool wear, rent etc - generally expressed as an hourly addition. We then run a Wholesale business, whether selling to other shops *or* "selling to ourselves" - we still have to account for the time it takes for the accounting, or shipping to/from others, or making sales calls and chasing invoice payments., Finally, we run the Retail business, which is where we spend time with the clients, or maintain and operate the store (or website), process orders, invoices, payments, accounting etc.
**EACH** of these needs paying for, and actual profit *beyond* costs - fabrication labor, wholesale overhead, retail overhead. If you are "just" running a fabrication business (hiring people to do the labor, buying the materials) you need to make a profit after costs. If you are "just" running a wholesale business (paying a fabricator), you need to make a profit *in addition* to the fabricator's profit. If you are "just" running a retail business (buying wholesale) you need to make a profit *in addition* to the wholesaler's profit. Just because *you* are all three businesses doesn't mean *each* shouldn't make profit - especially since, in essence, you are *part-time* at each of them.
If you are *only* selling direct-to-consumer, you may be tempted to skip the wholesale stage - I don't recommend this, as it will miss costs you still have, and will prevent you from *ever* selling through other outlets *if* your product is available *both* from your "shop" (web) or others - people *will* research pricing, and will be upset if you under-price your retailers.
Many, many "pricing strategies" out there skip all this, and just add a margin to costs. As you've noted, this is a disaster-in-waiting since it misses the real efforts.
Yeah, it "raises prices" - in reality, it exposes your actual costs. If the result is beyond what your market will bear, then you have to re-think your product - *either* reduce material and/or labor - *OR* (what people most miss) raise the PERCEIVED VALUE of your product - if there is a specific technique, or material, that raises your costs, MAKE SURE the customer can SEE the value in the product and "give you credit" for that feature. Note I say "see" - if you have to explain it to the customer, you've lost the sale.
It's not so much the exact multipliers, as it is separating out the different "costs" and labor at the different stages.
The magic multiplier is also where you accommodate those customers that can be a little more difficult. If you're on the fence about a job because of the customer, timing, or whatever, just increase your magic multiplier. Customer is a pain in the fourth point of contact? Their number is 5. If they want to pay that, maybe it is worth dealing with them. Adjust to reflect your needs as a business.
Good Video and directional correct. However more detail should go into whats making up the Multiplier(s). I.e. calculate your G&A cost. Critical to know if you're in the black on expenses. And yes the G&A includes marketing and BD expenses.Thats a sunken cost that either turned into sale or not. Like the fact you're covering O&M expenses in there however make sure you calculate wear and tear on the tools and machinery . Quality / Custom made items are at a higher value / price point than say an item from IKEA or production furniture store. Also Shipping and Handling should be outside the sale pricing.
It's this kind of bean-counting that keeps people from trying, failing, learning, and succeeding. Make a few sales, lose a few bucks, and fail better the next time. Do spreadsheets and cost comparisons later! Get moving first!
Hey guys.
I'm watching the video and agree with you to an extent. Where I think we go wrong is when we start talking about production vs a home hobby shop.
In a production environment we need to break this down even further.
Maybe in another video we can look at the differences between Net Profit and Gross Profit. Cost of Goods Sold vs Overheads. These are all very important things to be looking at but more importantly being able to understand to make your business successful.
As Davis mentioned we also must take taxes into account. Yes I know it's a disliked and taboo word but it's part of business.
Andy
Andy, I think that’s a little too much accounting! We gotta spend more time selling!
You bring up some great points, but those can be easily calculated AFTER a successful year of sales. Then we can go forward with making improvements and maximizing profits. Carts before horses and stuff!
It's better to get more quotes done, get more projects built, and get cash in your hand quickly than to get "the perfect net profit margin". It sounds like you're talking about cost accounting, Andy. And while it's necessary for legality, it's not helpful for making money. Look into "throughout accounting".
For independently designed and made pieces, X 1.5 isn't that bad. 30/hr is too high for most novices. Just multiply the cost of materials by 3-5 depending on the complexity. Then add wear/tear/delivery. So skill level doesn't affect hourly. Be ready to have a varied inventory that works as advertising for other customs that you can charge more for.