Finishing & Expendables Cost Estimates ??

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RBcarving

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Feb 22, 2012
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156
Location
Shell Knob, MO
For those of you who have done this long enough to have a steady routine...
What is your average per pen cost for finishing & expendables ??

Im thinking sandpaper, applicators, CA/finish, tube glue...even electricity. Id like to know your calculations or thoughts. Do you even figure specifically or just "add a dollar" ??

Thanks,
Brad
 
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Brad, I normally add in $2.00 for everything when I figure my price of the individual pen. I think this more than covers the items you mentioned. I may have to bump that up if prices keep rising.
 
Brad, as most your overthinking on how to derive at a selling price or even a cost price. As an example, how many two barrel pens did that piece of 2x3 inch sandpaper sand and how many grits of it per pen? Now were all the barrels the same hardness of wood? An did you use 50 watt bulbs to light the work or 75, how long did you have the drill press running? At what speed ? Same with the lathe, these all affect electricity used. We all will come to a different figure as to the cost of expendables and no set formula will work as there are too many variables. Use what you think is fair maybe one or two dollars.
Now to selling price. Look at the pen you made and the venue your going to sell it at. Look real hard and tell yourself "I can sell that pen at the type of venues I'm going to sell at for this much." That's my formula !
 
No matter how much a pen sells for, it's nice to be able to get an idea of how much profit you're making. The $2 estimate seems good to me. That should cover sandpaper, ca etc.

Trying to actually factor in electricity precisely is something I hope to never try to do! Rounding up a bit should cover that.

If you had to pay rent or substantially heat or cool your shop, might be something to consider.

Also, if it's a money making hobby it's still a different deal than running a business where actual expenses are more important to calculate.
 
You did not state that you are working toward a retail or wholesale pricing result, but your desire to estimate costs seems to point in that direction. I do agree that $2 is about right for the items you mentioned. If you are trying to arrive at your final pricing figure, I suggest (and use) the same approach as Roy. But you need to take that one step further. Since your pens will be different prices, the price points should be consistent in that the customer can compare any two (or more) pens, and be able to see why one is more expensive than the other. If the reason is not obvious, you need to be ready to explain why in general terms. Avoid getting into price nit-picking, since your prices are more subjective, ie., you price it that way because it is worth it, not because a line item list of components justifies the price.

Steve
 
I think that, knowing your running costs, and all materials costs involved with what you do, business or hobby can have its advantages but also its disappointments.

In a business, how need to have those figures to make the business viable while in a hobby, more often than not, is costing you to maintain that hobby. You know that is happening when you use all available money into it, and you keep short on everything...!

Investing back into a business or hobby, that's a different thing, you are building stock and conditions to get the business to grow, while in the hobby situation that means normally that, you get to a point where you have to sell as the storage space is getting smaller, and you have gathered far too much stuff that is creating more a problem than anything else so, you sell it to allow you to keep making stuff and have where to put it.

If you have a hobby where you use a lot of stuff and you don't really want to think about how much it is costing you or how much of the amount/ percentage of bills paid, was hobby related, otherwise the pleasures and positive/relaxing, enjoyable moments spent with "it", goes from a satisfaction into a headache/worry/disappointment, in no time at all...!

However, there is times where, bills start to get pretty hight and you need to work out if, the charges are correct or is a mistake/fault somewhere and that's when you discover "things" that can scare you a little and make you re-think what you are doing and the reasons why. It may be unpleasant but is necessary.

For example, I knew that, for every new tool or piece of equipment I add to the work-shop, there will be also a extra power consumption effect. Sometimes we don't realise how much power a certain tool or piece of shop equipment can cost just to run it. We thing about the advantages of having it and the price you had to pay to get it but, that's pretty much all at that point until, your power bills start to get quite painful.

I remember well when my power bill per quarter (3 months) was costing about AU$300.00, about AU$100.00 per month, in a few short years my power bill went from $300 to $1,000 for the same period of time:eek::mad:. It has been worked out that, 70% of my power consumption is coming from the work-shop area so, how much is that affecting the hobby...???

Considerably I must say, as I try to be as power efficient as I can be by replacing power saving bulb's and other minor stuff that is advertise or recommended as power savers but in fact, most are just a way to make you spend more money and feel good about it, when most don't work nor it was ever meant to...!:mad:

Still, does make no difference, things take time to make and require equipment to be used, making things a little easier for you, is costing quite a lot so, the extra items you may create/make/process as a result, require to have a quick turn around/sold to allow the bills to be paid, in the process, the amount of hours put into the hobby, increases considerably and you seem to have a lot less time for anything else.

However, I'm always interested in knowing costs of everything and deal with those issues the best I can, my hobby pays for itself while I'm willing to put as many hours into it as I do, I have had other hobbies in my life that were a lot more expensive than this one and that, regardless of the amount of hours put into it, one would NEVER get it cost covered so, the very most important question you can ask to yourself is, is what I do, a hobby or a business...??? and behave, accordingly...!:wink::biggrin:

Make no mistake, I love what I do, and I do what I love...!:)

I hope this make sense to you and you see where it fits in within your question...!:wink:

Cheers
George
 
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I actually did attempt to indentify the costs associated with the production of each pen. It was pretty tedious to do. I couldn't determine how to figure in electricity, but I didn't think it was a substantial cost. Heating or A/C might change the calculations significantly depending where you are located.

The total I came up with was $2.25 per pen. Now, having said that, there are a couple of things you have to factor in. This does not include items which were purchased that became waste/experimental/price of learning the hobby. For instance, I decided to finish my pens by dipping them in polyurethane. I also purchased CA glue and accelerator. So the roughly $30 invested in the "CA experiment" did not get included in the $2.25, because I don't use those to produce a pen. They were an experiment that to me, failed. In a similar fashion, if I decide to try wipe-on polyurethane and spend $19 on a can, only to find I don't like that as well, it doesn't get added to the cost, but is added to my "cost of education."

The other thing that is ambiguous about these numbers is the timing of the expenditure. I can spend $25 on a can of water-based poly. That will probably last 500 pens. So the cost to make the first application is $25, but over time its a few pennies. Now if I estimated incorrectly, or have loss of product due to old age, I don't know yet. At some point in time, I will have to shell out another $25 for a second can. A quart can might cover a single dining room table, but to most penturners, it could be a lifetime supply. Just something to consider.
 
I would not include electricity unless your shop on a meter by itself. Dividing home use & shop use gets tricky.

Add up total cost of consumables including sales tax or shipping if applicable. I would list those consumables on a spreadsheet and their total cost. Going down the list divide each item by say 100 . You can use any number you choose to divide by buy all you are looking for is a ball park figure.

Everyone's consumables list will differ from what am listing:

CONSUMABLE COST LIST
ITEM
DRILL BIT $8.00 $0.08
BUSHINGS $7.00 $0.07
SAND PAPER $87.00 $0.87
MICROMESH $20.00 $0.20
GLUE $10.00 $0.10
TURNING TOOLS $100.00 $1.00
GRINDING WHEELS $50.00 $0.50
FINISHING MAT $20.00 $0.20

Easy to come up with a number using actual cost so my end result of $3.02 little higher than $2.00 or $2.25 posted. Would be nice if spreadsheet posted as intended.
 
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"If a customer asks I am sure its at least $20, if TOWMBO asks its somewhere in the $.25 range."

Finally a solution inquiring minds can live with!

Well said Serenity Wood Works!
 
Careful going down this road. Once down this path you will likely do things, differently.

Having said that this same topic comes up every once in a while and I do recall many years back, 2007, but anyways the reply's came back diverse but I did make a spreadsheet for this. Various 'formulas' came out and they were:
cost * 150%
cost * 2 + $10
cost * 3
cost * 4
cost *5

What I did was figured each of these then took the average. Those should net you a spread. From looking at various sources where pens are sold I deduced that the typical market selling point is somewhere around the (cost * 2 + $10), (cost * 3) and the (cost * 150%) region. The average from the spreadsheet seems to be close to (cost * 3)

This includes shop cost, overhead and so forth.
 
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