Pricing your Woodworking
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- Опубликовано: 7 июн 2021
- WW'nTips-n-Tricks #094: Pricing
Does the typical pricing triad of: overhead, material, labor matter much in determining the price of craft work?
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Хобби
Sure makes a craftsperson stop and think, Shawn. Thank you very much for this. Wish we lived closer, would like to buy you a beer and chat a spell. You’re someone I admire.
This channel has way too few subs and views. Always good content.
I agree, I have seen a LOT of stuff there, but this fellow is my favorite and IMHO the best!
I fully agree with that
Hell yes. Spread it
I know right? I always feel that way so I went over and jumped on his patreon at my own tier! lol.
Been doing craft shows for about 6 months now and totally agree. I purposely take an uncomfortable stool to force me to want to stand and talk to people that come up
Thank you very much! I really needed this video! I'm 64 & just starting down the path of selling my work.
The other thing in the $100 per hour cost in your mechanic analogy is benefits - health insurance, sick leave, vacation time, etc. I do like your approach and thoughts here. One issue is that the prices are also pressured by the competition and what they are willing to sell for. Plus, one must make sure the product is superior to what somebody could buy from a big box home decorator store that was made by child labor in China or Vietnam.
I'm running with this idea. I had an idea about improving the exhaust vent with a rotating cap to open and close the flow. Thanks for posting all the awesomeness.
Helpful. I have been studying a bit, lol. (that is always a bit of an understatement for me)....wood turning. I haven't used my cheap old lathe for many years and really only used it to make/repair tools. I made one turning tool which is a sort of spear point. I modeled it after a borrowed set of tools, that I also used to make some handles. I don't see this tool offered or used by many. I also have an old 1" skew. My lathe is solid but very basic. I don't think it is worth modifying to make use of better chucks and live....blanking lol....the tail stock spindle pivot point thingy lol.
I know I will quickly out grow this lathe, once I get or make more turning tools. FYI, my lathe is all bushing with manual oil holes. using currently a 1725 RPM, 3/4 HP motor and step pulleys. It does what it can, fairly well IMO.
I have been looking into the cost of a suitable lathe and accessories and turning tools, and thinking about the limit of things that can be made, and sold, using these expensive tools. I also consider their use/value to make and fix stuff for myself.
At the very least, I will be making or buying a few turning tools, and will be setting up my old lathe in a more useful location, on a small old rough, but heavy, work bench I have.
I do however like nice tools, old or not, home made or not. To justify the costs of upgrading, even for my own uses, I would need to make things to sell. It would be easier to make saleable items with new more capable equipment.
I have been wondering how wood turners can be actually making/saving money. I am a jack of all trades, who likes nice tools,... so I don't make any money lol & :-(
I already have a lathe in mind that I can't afford. I know where to get tools I also can't afford, but I can make some. There are other tools and supplies I need so I must restrain myself, and make use of what I have first. Perhaps I can sell enough tool and file handles, to see if I can be productive enough, and can sell enough, and like it enough, to go ahead and get upgraded.
In the mean time, I am watching for a well made, affordable second hand lathe, and tools; and learning a great deal from RUclips craftspeople. I see that, ideally, I would also want a band-saw; unless I can manage with one of my 1960-70's chain saws. A better grinder, and/or wheels, for tool sharpening, will become more desirable to be productive/profitable. I will likely, soonish, be getting a couple diamond wheels, and then build the rest. I have been practicing with inexpensive diamond plates to sharpen hand plane blades and flat chisels. Very sharp blades! Well worth the money.
Thank you for this look into the costs and profit of wood turning.
I love your videos. I started watching when I caught the Woodturning Bug a couple month back. I made my first bowl last Sunday. I'm gonna turn that into a pipe tobacco ashtray. It's ugly and is still on my lathe needing some touch up, but I made it out of some old 2x12 scrap pine that was laying around my garage. Keep making these videos brother, I appreciate you sharing the craft with everyone.
Great breakdown. Also folks, don't forget your sandpaper, sharpening and replacement of blades, and glue as part of those materials. making money is hard :) but at the end of the day the perception of value is everything! market yourself like apple!
Thank you so much for this. I haven't reached the selling at markets point yet, I'm just developing my skills and starting this youtube channel to document my progress, but this definitely helped me understand what I should be thinking about for the near future.
Very good explanation! Thanks for presenting it.
Thank you for doing a video on this topic, it's a good one.
I think this is one of your best videos in a while. Part of that is just because I did my first art market last week. It is also very good because it is creating real value over entertainment and it is a somewhat unique topic that not many people do good videos about. This is no RUclips algorithm hit video, but this type of video is why use patreon to trade "value for value" as you say.
Thanks
Very helpful...thanks
Great video! And, it's true, we can't just calculate labor into the price, especially not as a starting woodworker. For example, you had that video on how to make that acorn box, and I'm pretty sure you mentioned it took you 10 to 15 minutes to make one acorn box. As a starting woodturner, I just tried making one this afternoon. It came out pretty well, but, it took me 2 hours to make that one acorn box. It's not just obvious that I can't compete with how fast you make one such box, but it also means I have to gain a lot of skill and speed, since, 10-15 minutes would lower that price for those boxes to an acceptable level. And that will take time and experience. Good thing, that for now, I see woodturning purely as a hobby, to make stuff for fun, for myself. But, I could see myself as a pensioner at 67-70 doing woodturning as a pseudo-professional, making stuff for two three afternoons a week, and then visiting one craftsfaire and a couple of christmas holiday markets each year to sell stuff.
So, gladly, I have many years to hone my skills and pick up that much required speed, to reach that level where I can make things at a speed that the cost drops to a level that a customer is willing to pay for it. And, I know, customers are rarely realistic in their expectations either. My other hobby is woodcarving, and I am noticably picking up speed at that. But, few people will consider that a 24" by 16" detailed relief panel depicting a complex, detailed scene can easily cost $1,000 to $5,000 to make. Same for a 16" statue, by the way. Which is one of the reasons why I picked up woodturning as well: my output is so much higher already, that I can imagine filling up a table some day with 75% woodturning products to sell as "low budget" between $5 and $50, 20% woodturning and carving hybrids for medium budget between $40 and $100, and just a few expensive pure carving products going for anywhere between $100 and $2,000. And I won't even expect to sell those last ones, simply because they will be out of budget for most people. But, I can't make them cheaper, and the same applies for most other carvers. Maybe some "Meister Schnitzer" in Germany could still make them at twice the speed I do, but those will still charge even more than I do, because they already have a waiting list for commissions despite being much faster and more expensive. (And I refuse to do commissions on hobbies, since they drain the enjoyment and replace it with stress, but that's a personal thing. Not everybody performs better under pressure.).
One other thought: to you, the Osage Orange bowls are a commodity because you make a lot of them. In reality, they are a unique item because so many others don’t use that material for their products. This is more of a signature item that differentiates you from the competition than a commodity.
Thank you for sharing this information 🙏😊
I really appreciate this video. Great help to us all who want to make some money in this craft. Thank you very much!
Loving the videos mate. Suggestion for a video is perhaps how and what you would take to a market. Like possible variety, amounts ect. Cheers have a good one.
Great video as always! I always have trouble pricing and under price all my stuff.
Hi, I love your videos, I want to make my own perfect holding coffee mug and nice bowl for salads and stuff and I wonder how should I seal it ?
Again you made a superb educational video!! Why o Why didn't i have more teachers like you.... Thank you for all your explanations here and in past videos. Helps me a lot!! I always look at a thing i created and think:" What would I pay for this?" Not the right approach I guess...
Thank you!
I'm not ready to make stuff to sell yet, but this gives me food for thought once I get there.
Thank you for this video!
P.S. I understand you have some expertise on building fences to keep deer out of the garden. 🤣
I'll show myself out!
Good one on the overhead! That's the real rub with many. I actually don't want to think about that, and since I don't really sell stuff I don't have to. Hope my wife thinks the same...
As always a much needed content.
Huge question though, I make wine stoppers & Christmas ornaments, are any good consistent ways to laminate wood scraps/strips to make more unique stock for projects? And if so could you do a video on it.
I have yet to figure out a way that there is a cost/benefit advantage of laminating wood vs just using solid.
Great video on a subject I think many are afraid to talk about. This is almost identical to those of us who have worked as a freelancer / contractor where you need to always consider your “full” costs of operating, and then looks at the market at what the price is that people will pay. If your costs are above, then maybe you need to approach things differently (reduce costs, get an alternate income for a time, aim for a different market where your costs are lower / price can be higher). The gap between is your profit. Sometimes that will be good enough to re-invest into your craft (better tools etc) and sometimes it will be almost zero depending on circumstances (time of year, saturation, covid etc).
Also, don’t forget about your unproductive time (marketing, accounting, travelling) and your absent time (illness, holidays), and your indirect expenses (health insurance, indemnity insurance, taxes).
Mantul 😍😍😍
Semoga semakin sukses selalu
Shawn, thanks for the video, as good as always.
I wonder if you have learned all of this (specifically overhead) before or after your IRL school? If after, what would you do differently, cost-wise?
Lesson I learned is that only 2 schools I know of in this country are not subsidized by a patron, grants, government programs or the like and those 2 were launched with the help of those programs. In other words a teachers life savings wasn't enough.
Awesome video man ... this makes so much sense when you break it all down. Thanks for sharing :-)
Very interesting video.
Amen. Where is the incentive to work efficiently if the slower you work the more things are worth? Your 10% of inventory figure is interesting. I had heard that you want to sell 10x the booth fee and have 3x what you plan to sell. I have a big 9 day fair coming up in August and it's the first fair that I do so I'm just going straight into the major leagues without any idea what I'm doing. I know what their average sales were for 2019 for woodworking booths ( about 6-7x the booth fee) and I've been planning on 3x that with it divided about equally in the ornaments, cutting boards, and jewelry boxes that I'll have. There ain't no way I'm going to have another 3x that much ready in 2 months so I hope your 10% approach doesn't work in this situation or I'm way underprepared!
there is definitely a difference in the cost between those 3 bowls because as you've gotten better at woodworking, the amount you should charge for labor goes up. the time of highly skilled craftsmen is worth more money than a beginner.
Best turner on the tube
As you point out, after all the figuring, your work is only worth what others are willing to pay for it, . If I take my bowls 150 miles from here to the coast, they are worth $100. Here where I live, they are worth $15. That was a real shock. I thought I would be able to make some serious money on a hobby. Not going to happen if you don't take the product to the buyer who is willing to pay whatever figure you have come up with.
This is from 47 years experience as a cabinetmaker. I look back over the years of building huge entertainment centers and how I almost gave them away...but it's what people were willing to pay, not necessary what it was worth in an upscale city. I struggled most of my career to make ends meet.
Out of curiosity, how much money do you sell 9-10 inch bowls for? I suppose it depends on the wood species?
You didn’t watch this video.
My opinion is that one has to understand about overheads, materials and labour pricing first then they can actually price on marketing conditions and opportunities.
The market determines the price. The three elements you discuss define your costs. I suspect that very few have real costs below market price.
I showed an example where price should be way below cost in the video.
Am 6 minutes in and the video is wonderful!
Good video. You left out a 4th component of pricing, which is PROFIT. Without a profit you are merely covering your direct and indirect costs. Profit is what allows you to buy more tools/equipment, afford more advertising, etc. Without accounting for profit you essentially have a job with all the headaches of ownership (which you describe well -- administration, marketing, sourcing materials, etc.) and none of the benefits. I agree with your formula as far as it goes, but when you arrive at your total, I'd add a minimum of 25% to cover profit. So, your $66 bowl should be priced at $82 -- the $66 covers your direct and indirect costs, and the additional $16 goes into your bank account. And if the market won't bear $82 for that product, then that should signal a change in product strategy or positioning vs. reduction in pricing. Keep up the good work!
In my analogy profit is integrated into labor as explained in mechanic hourly charge rate. $100/hr - labor = profit per hour. But if you listened to the rant at end. That's a model for a commodity.
@@wortheffort Gotcha, I thought you were basing the pricing on the $60k annualized salary of the mechanic without the profit included. My bad.
60k/yr = $30/hr if you go by a standard 2000hr work year.
Do you sell your bowls online?
yes
I would be very curious to hear your differentiation between art and craft. To me craft is just a sub form of art like painting or photography or whatever. It sounds like you have a different view that could be a good conversation.
I know art when I see it. Mostly it comes down to expression. I feel the word art has lost it's original meaning as has craft. There's a reason they are separated in the term "arts and craft".
Did I miss something? 30 hrs per week, 42 bowls per month... Isn't that 10 bowls per 30 hours @ $50/hr or 150 each, and then 20% material cost and overhead?
Wait, so you put liquids in your bowls? Even hot liquids? I assume that bowl was finished with walnut oil, the bodark one.
Ya, why wouldn't ya?
@@wortheffort Well Ive always heard that hot liquds are bad for the finishes on wooden bowls.
@@E.F.Woodturning you decide, did you make a piece of art or something to be used. Both have their beauties.
There's a simple way to 'guesstimate' your minimum price for your products.
Calculate how much you need to survive on a weekly/monthly amount, as if you were assessing a job to see if it will suit you.
Then divide that by the number of products you can make in that time.
That will be the minimum.
eg. if you need say, £/$1000 per month, and you can make 5 items per day, 5 days a week, for 4 weeks, that's 100 pieces.
So, $/£10 per piece.
Then double it to cover costs, and profits, and other expenses, like loss of time/products due to fetching materials, and replacements/machinery down time, going to shows, advertising, doing accounts for tax purposes, and dealing with customers. You can also calculate the nominal cost of material for each piece, and add that on to the basic cost price. The piece of wood may be free, but it costs time to acquire and prepare it. Time is money.
Keeping a book on costs/income is important to assess your progress on a regular basis. In my experience, those that didnt keep their bookkeeping up to date, failed, because disaster overwhelmed them before they were aware of its approach.
After 6 months, you should have some idea if you are clearing enough to survive.
If not, then you need to increase your prices accordingly.
As a rough guide, if you can survive the first two years, you'll probably make it.
If not, try a different range of products or occupation.
In my past, I originally accepted any work that was offered, but gradually, I recognised which ones took too much time, and paid too little, and eliminated them.
Any self employment is dependent upon your location, unless you sell online, and then it depends upon the online location.
'Etsy' is one site I've noticed, that specialises in selling craft works.
I'm retired, after self employment for 25 years, so all of what I make goes as gifts to relatives, or friends, at the moment.
I no longer need to work to live, as I live on pension/other income.
Hope this helps.
.
You didn’t mention marketing, salesmanship or quality once and repeated much of what I covered. Didn’t watch the video did ya?
@@wortheffort
Only the first 8 mins, will watch the rest this evening, after my daily chores.
I just gave the basic, quick 'starter' assessment/synopsis.
My comment was meant for your followers, rather than yourself.
😊
@@niklar55 well the video blasts apart that methodology after explaining it so…..
@@wortheffort
25 years of starting and operating 5 different businesses simultaneously, has given me just a little knowledge of self employment.
My comment is not to meant replace your presentation, but to supplement it.
.
@@niklar55 I understand. But maybe watch the video so your contribution is relevant to the point of video as I literally call bs on this methodology for craft type sales in the video.
This is all that I've preached to my daughter who is a glass artist. One thing that was good about the lockdown, was that it made her think very seriously about how she marketed her items at concert venues and festivals. She has a very good personal sales technique, but it's not enough. She has since diversified to other markets such as gift shops and online sales (not Amazon!)
this is really nice. Especially on 1.5x speed
Didn't think about subsidizing the shop space cost :)
You forgot to add in education cost to your labor. What did it cost you to learn what you are doing?
That’s overhead.
Like😉🙃😘😘🥰😍😍
The worst part about most wood turners is they kill the market giving bowls away. If you made it sell it. If you give them away then you are cheapening your skills!
The more you give away the less value you will put into your work.
Make money selling spindle work hahaha.
I just want to make enough money to pay for my tools.
That approach makes it harder for others. Depressed the local market.
@@wortheffort truth. Matthew you should sell your work as you are learning. It will not be all that great, but the value is determined by the customer. I turned lots of OK bowls and sold them at craft fairs and such. It helped me buy a larger laguna lathe. There are people who will love your goodish work, and it will bring value to their lives. Keep grinding and improving, then price your work to actually make a living on. A high price will actually help people value your work more.
I turn and sell about 100 bowls a year and my retail prices on ambrosia maple bowls: 12”-$195. 16”-$275.
I have a degree in economics. If you had been teaching my grade would have been better.
Capitalism 101. That is not a bad thing, as long as it is not brought to extreme.
You are confusing things. Why should you work in the evening, but not work from Monday to Friday?
try explaining the cost of their 'free' garage - can I come turn in your garage with your tools? for free? - and sell what I make. Everyone will tell you no! They will want a cut of your sales for using their tools/garage!
my new shop building cost $50.000. But it added $40 or so to my electric bill and $100/month to my property taxes and 150 a year to my home owners insurance.
And everyone figures the labor for turning the items...but you'll spend time cleaning, maintenance, sales, book keeping, learning, etc. If you would not do these things for free for someone else you shold not do them for free for your own self.
I tell people if they're not charging for all this they actually donating their time/tools/etc and well, charity is a wonderful thing but people buying our products don't need the charity! Charge proper prices and donate the money to a some truly in need.