Woodwork as a Business

Getting Started
Money Matters
Welcome to Passion for Woodwork
Written by Web Master   
Saturday, 17 February 2007

If you have every thought about making money from your woodwork craft hobby, This is the place to be.  Here at Passion for Woodwork  we provide quality business advice, hints and tips to help turn your passion to profit. There is money to be made from your hobby and with the right advice and a little effort you can live the life of your dreams. Working at what you love and making money from it.

 

For a while now we have been selling a book called "Woodworking as a Business : Turning Your Passion to Profit" Image

The book has been a staple for many people building a woodworking craft  business. Take a look at it here .

 

So why start the Passion for Woodwork site ?


 

 



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Kids Rooms And Crafts.com.
Offers ideas for decorating kids rooms.

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Last Updated ( Saturday, 21 April 2007 )
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Pricing Hand Woodworking Services
Written by derryck   
Thursday, 17 January 2008

Some people enjoy the traditional art of woodworking and want their furniture to be made by hand. Customers may be willing to piece together their own piece of furniture, but might not have the skill or the time to hand woodworking of the piece of furniture.


For talented woodworkers this special service can be a wonderful business option. Of course, it’s far more labor intensive and time consuming then machine woodworking. It can also be an expensive process for the customer.


The pricing formula for hand woodworking is fairly straightforward. You have to make a decision about how much you want to charge per hour, than keep track of your hours. The customer’s fee will be dependant on how many hours you spend woodworking. The price per hour will vary depending on the intricacy and frequency of the woodworking.


This type of woodworking really is an art form. The time and effort used to hand woodworking needs to be fairly compensated. Do not undercut your prices. Check out hand woodworkers on the internet and compare what you think would be a fair price. Some websites to check out are:


www.pflwoodworking.com


www.yardandgardenstructures.com/gallery.html


www.womeninwoodworking.com/links/links_show2.cfm?id=19-137k



We’ll also look at machine woodworking prices in a bonus chapter on machine woodworking services.


In the next chapter, we’ll discuss how to develop a plan for finding future customers.



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Last Updated ( Monday, 18 February 2008 )
 
Pricing Examples
Written by derryck   
Thursday, 17 January 2008

Materials Cost + Overhead + Labor Ratio


In this method you calculate the cost of your materials and determine the cost of your overhead, plus labor; add them together – this is your wholesale amount. When you double the figure, you get your retail amount (the amount you would be charging your customer).


Let’s break this formula down further:


Cost of materials: Cost of materials is everything that goes into a piece of furniture, not just the material. Some of the other components will include: glue, nails, paint or others.


Overhead: all the expenses that go into making up the piece of furniture that aren’t part of the raw materials. You need to think about things like electricity and other utilities, the “rent” you would be charging yourself for your workshop space, travel, machine use for your circular saw, repairs and maintenance, etc.


Labor: How much is your time worth on an hourly basis? Here’s a note of caution: people tend to underestimate their worth. Think about what you are doing, could you get someone else to do the same work for the same wage? You need to be paying yourself a fair, competitive wage.


Some people find it challenging to use the above formula because it’s often times difficult to price out the “overhead” portion of the ration. For instance, if you have your workshop in a spare bedroom, would the heating bill be separate from the rest of your house? It’s difficult to calculate a precise overhead rate. One easy method for calculating overhead is to take the price of raw materials and divide by three (in other words, overhead are 1/3 of raw materials cost).


Select one or two small projects to use as samples. Let’s say, a simple chair. After putting together the chair and completing it. You calculate the following:


Cost of Materials = $20.00

Number of Hours Labor = 3


So if your cost of materials were $20.00, then your overhead expense would be $6.67.


Let’s say you decided an appropriate hourly wage would be $10.00 per hour. For this project:


Cost of Materials

=

$20.00

Overhead

=

$6.67

Labor

=

$30.00

Total (wholesale)

=

$56.67

Retail Price

=

$113.34


If your find the formula for calculating overhead to be laborious, you might want to consider using some of the pricing methods listed below:


  • Price Per Hour

  • Price Per Piece

  • Price by Quarter


Let’s take a look at each of these methods in detail.


Price per Hour


Using the hourly rate, you determine how much you can get accomplished on an entire unit – say a chair. So for instance, if you decide on average it takes you about 2 hours to complete a section of the chair and a fair hourly rate for you is $10.00, then you will calculate the price of the chair by the number of sections in the chair. As an example:


Chair Foot= $20.00

Complete set of chair foots= $80

This pricing method is simple, it just requires you to calculate your fees based on how many squares and how many hours it takes you to complete a square.


Price per quarter


This method is based on the size of the piece of furniture and the type of woodworking done on the actual piece of furniture. So to begin with, you need to establish how much you feel is appropriate to charge per quarter. Some examples, let say you would charge:


$20.00 for a simple design with an average time of realizing the piece of furniture

$25.00 for a slightly more complicated design, heavier woodworking

$30.00 for a very complex woodworking style


Based on these figures, you calculate the quarters of wood used for the piece of furniture and the complexity of the piece of furniture.


Whatever formula you use to calculate your price for the piece of furniture, you need to consider the market and what it’s being offered by other woodworkers. Check, look wood furniture shows, craft fairs, and internet sites to see how your pricing compares to others. You may need to raise or lower your fees slightly. There are people out there that are charging ridiculously low prices (and perhaps others too high). Don’t try to compete with that pricing, just make sure that your pricing is consistent and fair.



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Last Updated ( Monday, 18 February 2008 )
 
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