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Forum topic by Skippy906 posted 02-13-2013 05:02 PM 999 views 1 time favorited 22 replies Add to Favorites Watch
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Skippy906

101 posts in 731 days


02-13-2013 05:02 PM

Not sure if this has been covered or not, but recently I had had some co-workers ask me to build some projects for them. I am not sure how to, or how much to charge them. Most of my projects have been for myself or close family.

So my question is, if you build projects for others, how do you determine how much you charge? I know this can be a vague question, but any input will be helpful. Thanks in acvance

-- Making progress


22 replies so far

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Loren

7821 posts in 2392 days


#1 posted 02-13-2013 05:08 PM

6x material cost is not a bad way to start to
ballpark it for more basic machine type work
that doesn’t involve tricky joinery or a lot
of hand work like carving.

Then you can estimate the hours it will take you
to do the work to a standard that will satisfy
your client. People will say they want a value price,
but they are always fussy to please with custom work,
no matter what kind of break they are getting.

-- http://lawoodworking.com

View huff's profile

huff

2810 posts in 2029 days


#2 posted 02-13-2013 10:14 PM

skippy,

Great question with no easy answer. Doing this as a hobby is totally different then pricing your work as a business and making a living at it. Most hobbyist will tell you to make sure you cover your materials and whatever you would like to make extra to put towards a new tool or just help support your hobby. So that could be as simple as figuring your material cost and doing a multiplier on your material cost to determine a price. Material cost x 2 or 3 or 4 or whatever multiplier you want to determine a price. But to price a project that’s both fair to you and to the customer, there’s a lot more to it than a simple multiplier.

Under pricing your work can be as bad as overpricing your work if you’re not careful. If you do a project dirt cheap for someone because you’re just doing it as a hobby or you’re friends and you want to cut him a great deal, than expect a lot of business from others. As they say; word of mouth advertising is the best way to build a business, but once you give your work away, all referrals will be expecting the same deal and it can be very difficult to get off that slippery slope!.

The best way to figure a price for anyone, whether as a hobby or a business, you always need to figure your material cost as close as possible, but from there you need to take the time to figure your time to build their project. I know it’s hard if you haven’t built a lot of projects, but you can still get a pretty good idea what it would take in time. Trust me, you’re going to be off, but still try to figure it realistically. If anything, we have a tendency to underestimate the time it takes to build something, so the fear of charging someone for too many hours is usually slim to none! lol

The problem most woodworkers have when it comes to pricing is we allow ourselves to get a preconceived price in our head before we ever start and then we end up trying to work towards that number even if it doesn’t make any sense.

Figure your hourly rate! Only you can decide what your time is worth being in the shop working. Working on your days off, working in the evenings, working on week-ends and what your time is worth being away from your family, then you may decide you don’t even want to build a project for someone else.

Figure your time invested, times your hourly rate, plus the cost of the materials and then you can decide if you want to figure in anything for wear-n-tear on equipment, utilities or profit. That should be the price you quote to a customer.

If your price is too high and the customer decides not to do it, at least you know you didn’t waste a lot of your time building something for someone for nothing, taking time away from your family and wearing out your equipment.

Good luck.

-- John @ http://www.thehuffordfurnituregroup.com

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richardwootton

1457 posts in 699 days


#3 posted 02-13-2013 10:24 PM

This is a great question. I have been wondering the same thing for projects requested by co-workers!

-- Richard, Hot Springs, Ar -- Galoot In Training

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huff

2810 posts in 2029 days


#4 posted 02-13-2013 10:53 PM

Richard,

It really is a good question and it’s one I’ve watched so many woodworkers struggle with over the years. It can be pretty unnerving when someone ask you to price something for the first time. You feel you don’t have the experience or confidence to price your work at a decent price so we end up giving our work away.

We spend way too much time worrying about what the mass-manufactured furniture sells for and feel for some reason we have to compete with their prices. A lot of your co-workers also think that simply because you do woodworking as a hobby, you should be cheaper. You have to realize they have no idea what custom woodworking is all about. Don’t beat yourself up because someone at work thinks your price is too high or they can’t afford to have something custom built.

A simple tip to remember when it comes to selling your work. Just because every project we build, we have to start from scratch and to us it is custom building, especially if it’s something like a table or vanity, or any other piece of furniture or cabinetry they can find in a retail store, then they don’t look at it as custom. They can’t put value to it, just a simple cheap price. You can’t spend time worrying about those, you may be able to educate them, but generally they already have a price in their head and if it’s a penny more, they will think you are trying to rip them off.

I couldn’t count how many times I’ve had someone tell me; Boy that’s expensive! And my only response is; Compared to what? Wal-mart, Ikea ? That’s OK, they can’t compete with me. That usually confuses them…............They can’t compete with me? Makes as much sense as thinking my pricing should compare to Wal-mart’s.

-- John @ http://www.thehuffordfurnituregroup.com

View nwbusa's profile

nwbusa

1017 posts in 1030 days


#5 posted 02-13-2013 11:54 PM

For me, woodworking is a hobby that I enjoy for its own sake and not something I do to make a living. So when people ask me to build something for them I calculate my price as follows:

1. If it’s a quick, easy build for close friends or family, I just charge them the cost of whatever materials I need to buy. This is what I call a “favor”. If the job is not as quick or easy, then it’s a “big favor”.

2. If the job is too big / complex, then I start adding labor costs. This can range to case of beer all the way up to my “I really don’t want to do this job” hourly rate of $100/hour.

-- John, BC, Canada

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jeffswildwood

531 posts in 721 days


#6 posted 02-14-2013 01:07 AM

This has been a constant source of frustration for me also. I too don’t do this for a living but really enjoy the hobby. I also have had several coworkers ask me to build them things. Many of them I have to start from drawing up plans in autosketch which also takes time. Mostly I set the price at “whatever I think is fair”. Several times I have had people say “I can’t believe you sell these so cheap”. Then I’m stuck on that project. The slippery slope huff described above. But then other people make orders for other things from the word of mouth. I have also quoted a price and people say that’s more then I wanted to put into this. I polity tell them the reason, wood cost, screws, hinges, stain, polyurethane ect and if they still don’t want to pay that much, then that’s OK. I just try make a price me and the buyer can live with.

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lumberjoe

2847 posts in 992 days


#7 posted 02-14-2013 01:17 AM

I’m with John. If I like you and it’s fun, 1.25x the cost of materials (figuring 30% waste). Since I enjoy woodworking, it’s like getting free wood and an excuse to spend a lot of time in the shop.

If it’s a friend of a friend, 2x the amount of materials

If it’s something I don’t want to build, but am confident I can, I will throw out a really large number that will make it worth my while. I have only done this once and was kind of disappointed that I didn’t go bigger when the guy said “that’s all? go for it”. It was about 5x the cost of materials

I usually get burned when I go for material only. There is always SOMETHING that comes up. A router bit I don’t have (or dropped on the floor), replacement planer blades, that grit of sandpaper I ran out of, etc.

I have no idea how people feed their family doing this

-- www.etsy.com/shop/KandJWoodCrafts

View TheWoodenOyster's profile

TheWoodenOyster

1027 posts in 679 days


#8 posted 02-14-2013 01:22 AM

I am in the same boat as you as far as being confused/baffled at what to charge people I know for projects. I am doing a project for my mom right now and she is paying me $15 an hour, plus she paid for all of the materials. I know you are thinking that I am a jerk for charging my mom for something, but she is really supportive of my hobby and I think she views it as more of a “donation”.

Back to the point though, I have heard multiple guys say, “If you start low, you’ll never get out of the rut”. I take that to mean if you charge one guy $800 for a coffee table, that’s what the next guy is going to want, even his table is made of pure ebony. I’d say be respectful, but don’t be bashful. They need to understand that something handmade out of solid wood by an American is worth more than poisonous mdf with wood grain paper glued to it.

I’d say give them about a 25% discount from what a professional would ask. What’s the worst that could happen? Remember, you are a craftsman, not a laborer.

-- The Wood Is Your Oyster

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MNgary

236 posts in 1161 days


#9 posted 02-14-2013 02:15 AM

My grandpa always told me to never do business with relatives. My father added never with friends. I tell my children never do business with relatives, friends, or co-workers.

For a co-worker, I recommend you start with materials, add shop supplies and overhead, then an hourly wage equivalent to what you and/or your co-workers make at your job. I mean, I mean, if a co-worker makes $35 an hour, should be willing to pay someone else (with, I should add, a skill and equipment that person doesn’t have) the same hourly as he/she makes.

Ya, it won’t get you a lot of business; but it will prevent one-helluva-bad situation!

-- I dream of the world where a duck can cross the road and no one asks why.

View kizerpea's profile

kizerpea

746 posts in 1111 days


#10 posted 02-14-2013 01:13 PM

dont forget to get some up front $$$

-- IF YOUR NOT MAKING DUST...YOU ARE COLLECTING IT! SOUTH CAROLINA.

View helluvawreck's profile

helluvawreck

16033 posts in 1611 days


#11 posted 02-14-2013 01:55 PM

One word of advice. Insurance companies are starting to look at people who are just hobby woodworkers and those who make money off of things they make in their home shops as two entirely different things. My insurance guy told me that if you sell something to even a neighbor, friend, or even family member you have crossed the line. It’s worth checking into and ask them the hard questions. You may put yourself in a situation where you have to have a separate insurance policy for your woodshop including some liability insurance.

helluvawreck aka Charles
http://woodworkingexpo.wordpress.com

-- If a man does not keep pace with his companions, perhaps it is because he hears a different drummer. Let him step to the music which he hears, however measured or far away. Henry David Thoreau

View huff's profile

huff

2810 posts in 2029 days


#12 posted 02-14-2013 01:59 PM

Kizerpea made a good point that we forgot to mention up to this point. If your are going to build something for someone, don’t be afraid to ask for a deposit to start with. 50% is not out of line and that way it gives you the money to buy your materials etc.

Virtually every business will require a deposit if you want them to special order something for you and they don’t normally stock. I’ve never had a customer bulk when asked for a deposit….......if they do, that would be a “red” flag for me and I would run.

If a prospective customer does not know you or does not trust you, then I would suggest the two parties don’t try to do business together. Remember, that’s a two way street. If you don’t get a good feeling about someone, then I would recommend you walk away too.

-- John @ http://www.thehuffordfurnituregroup.com

View BRAVOGOLFTANGO's profile

BRAVOGOLFTANGO

271 posts in 747 days


#13 posted 02-14-2013 02:06 PM

Excellent replies, boy this has been a tough one for me as well, especially with the rocker I built and the new design with mortise & tenons and a couple requests for rockers. Word spreads quick if people like your work, especially family haha! It’s so hard to charge family for labor, materials, meh, no biggie to request that, but you feel guilty charging family labor.

Figure if I could sell some work online to locals, I could get some fancier tools.

View bbasiaga's profile

bbasiaga

112 posts in 739 days


#14 posted 02-14-2013 02:08 PM

MNgary, by my calculations, your great grandchildren won’t have anyone to sell to! LOL.

This is a good thread…Some friends and I have built stuff for eachother in various hobbies we are fond of, and its always been a barter. This for me, that for you kind of thing. We’ve had a few others through the ‘net or wherever ask us for stuff, and pricing has always been a challenge.

-Brian

-- Part of engineering is to know when to put your calculator down and pick up your tools.

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helluvawreck

16033 posts in 1611 days


#15 posted 02-14-2013 02:15 PM

Because I hope to make at least some profit on my new shop when I build it I have set up a small LLC and am going to have a separate policy on my shop building and equipment. It was not that expensive to do this. This will create a small amount of overhead but it also has a lot of advantages as well. No matter what you will have some overheard so you should include this in your pricing as well. Best of luck on your business and may you always be happy in your work.

helluvawreck aka Charles
http://woodworkingexpo.wordpress.com

-- If a man does not keep pace with his companions, perhaps it is because he hears a different drummer. Let him step to the music which he hears, however measured or far away. Henry David Thoreau

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