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Pricing It!

Pricing It!

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Published by Dave Smith
Suggestions on how to price your work
Suggestions on how to price your work

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Published by: Dave Smith on Sep 08, 2010
Copyright:Attribution Non-commercial

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09/07/2010

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Pricing: all Crafts, all items
By David Smith Copyright © 2010
Harvey Littleton, famous glassblower in Wisconsin, told a group of graduatestudents back in 1971, that if a piece didn't sell, he
doubled
the price. He keptdoubling the price until it became so precious someone bought it. I doubt that wouldwork for all items, or all people. Hummm« But it was his philosophy, and it must haveworked
enough
to him to keep it around.Here on Scribd prices are set by the seller (with a over ride-able price suggestionby the computer). They can currently range from $1 for a graphic novel (aka, a µcomicbook¶) to $5,000 for an in-depth market research report. Sellers can pick a price or passthe choice on to Scribd¶s automated pricing option, which generates an optimal price tagbased on a cost-sales analysis of similar items in the Scribd Store. At last, prices youcan« be sure are «. Hummm partly wrong? Whatamatter, ya don¶t trustcomputers?Well, what other way is available« ? Glad you asked!
I
f the Work is good...
( the work, not the price! They are
not
one and thesame!)(Keep that in mind)If nothing sells, the price is too high (for the current market).Don¶t despair! Try a different market? Or, repackage the item.Or, come back later. Or, reprice the item.If 
some
items sell, the price may close to being all right, but in general, still a bit toohigh.If half sells, and half does not, may be a good time to think about what sense could bemade of this. Look for differences.If it almost all sells, the price and setting is right. Really. You got it
right
, relax!If everything sells, the price is like way right, or could even be bumped up a little. Go for higher.
 
 It all boils down to«. Start
high
± you can work your way down, if needed«but if you start out too low« it¶s going to be hard,
very hard
, to raise them. Very hard.So« Start out
high
and then go down.³Who is the item for, and, did they show up?´ is the other part of the equation.How long it took to make the work is irrelevant, and of zero interest to anyone as for itbeing a justification of anything, and should have nothing to do with the price.Make it right... sell it right«
On pricing, and under-pricing...
 
Or, how much should I charge?
You can ask whatever you want for a piece, but selling it at a high price may takesome time to happen, or not even happen at all. A suggested way to
start 
the priceµhunt¶ is to consider the time it takes to gather the materials, and the time taken to buildit (i.e., shop time). For starting out I recommend shop time be charged at a rate of atleast $25.00 per hour. High? Nope! Can you buy some µshop space¶ at that price? Any price? Any price at all? Didn¶t think so. So, $25.00 per hour is cheap, right?Moving right along«For this example, assume in your shop there's a belt sander. Let¶s pick a popular model like the low cost Harbor Freight unit, running around $70 new, a 4 by 36 inchmodel.
M
aking Adjustments
One version of this popular unit needs a 3/16 hex wrench to make the trackingadjustment. We could buy a T handle wrench just for use on this machine, or in thename of economy you could have only one hex wrench set in the whole shop, andeveryone temporarily borrows the tool they need from the shop set. That would be acommon action, but a bad move. A 3/16 T handle hex wrench costs $ 1.72 (well, at the time this was written it did).You probably have a set of hex wrenches, and if you're lucky it's a complete set,perhaps even a T handle hex wrench set as well.Well, not quite complete? Why isn¶t it a complete set? At $1.72 each it¶s so easyto order replacement wrenches to complete the set. This is best done from a well
 
thumbed industrial supply catalog that a home shop owner can certainly get, butprobably hasn¶t yet (hint). Or use the Internet, In any case, the shop will now have acomplete set.So you might think getting another wrench just to hang on the machine to makethis required adjustment is overkill, a µfor sure¶ money waste. But it's not - and here'swhy. A machinist is paid, let's say, $10 an hour. Yes, that's really,
e
ally 
on the lowside, but this is set low as a part of the example. If it was high the repayment wouldcome even faster, true. But if it was high you might think it didn¶t apply to you - but it stillwould, and does in both cases.Let's say this machinist spends 5 minutes each working day just walking over toget this hex wrench from the set, and then putting it back when he's finished. We'll saythe wrench never gets lost (ha!), never is so worn it doesn't work, and no one else is
ever 
using it so he doesn't have to stand around waiting for the tool to be free, or someone else doesn't have to stand around waiting for him to finish with it.
Ha!
, again ±this is the real world, things like that don¶t happen, much more time is wasted. Muchmore time is wasted Anyway, this isn't going to be true in the real world, but we'llcontinue our example as if it was.Let¶s see what not having this tool by the machine costs in a month. We said themachinist spent 5 minutes over the course of each day just getting this tool. Fiveminutes times 22 working days in a month is about 1.8 hours. That's 1.8 hours of work
lost
in just one month doing nothing but getting a two dollar tool (2$? - I rounded up1.78 to 2). Remember, we said this machinist is paid $10 an hour? I know, that¶s lowbut that is intentional, this is a worst case analysis. His services are probably billed at30 dollars an hour, more likely at $100 an hour, or better. In other words, he spentalmost two hours of the month doing nothing but just getting this tool. Hello, that¶s a
$2
 tool at best we¶re talking about - less than that, really. 32 times 2 is $ 64, so let¶s callthat a modest loss of $36 (!), not $64.So, in just one month management
lost
at least 36 dollars (or more!) making themachinist get a 2 dollar tool. Sound like a good move to you? If having too muchmoney is your problem, then send me your problem.Hey! Look at those numbers again. Management could buy a brand new hexwrench for this guy
each month,
throw it out at the end of the month, purchase a newone, and still come out ahead. Of course they wouldn't have to. I would be surprised if in the real world the hex wrench didn't last for, say, a minimum of three years. This is alow wear job - probably it would last 10 years at least, or maybe a lifetime, or until it getslost, but let¶s pick on 3 years. Ten years? Hey the machine itself may wear out by then.The tool will probably last a bit longer than you might expect, as you can grind off 

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