Counting the costs: pricing your work

Above: Chatoyance, jarrah, silver ash, lace sheoak, suede. Shaped components, inlays, linings, inner compartments and non-standard constructions – details such as these can take more time than what is required for a larger scale work. Photo: Naman Briner

Words and process photos: Damion Fauser

I’m a numbers guy, and what I love about numbers is they simply don’t lie. Keep this in mind and you’ll be on your way to successfully and appropriately pricing your work, whether it be for one-off custom pieces or production work, small in scale or requiring a crane to install.

I spend a lot of time quoting, and I use a simple, time-proven formula that has worked for me since I began my workshop journey. This does not mean that I get every job that I quote, quite the opposite is true. In fact I’d go as far as to suggest that if you are securing every job you quote on then I’d suspect you are getting it wrong in some way.

In this article I’m going to outline some of the numerical factors that contribute to the cost of a piece of woodwork. It will be objective and brutal, but ignore some of these factors at your own peril.

Quinkin dining table, red cedar. A minimalist silhouette rests on complex veneer lay-ups and a torsion box construction, including elliptically coopered leg pillars. Consumables ran into the thousands, and the table needed to be shipped overseas in a custom crate. Neglect these costs and you'll find yourself in the red. Photo: Naman Briner

Material costs

I consider materials in three broad categories – timber, tooling and consumables – as well as the supply and delivery costs of these items.

Timber is likely going to be a substantial factor in the cost of your workpiece, with several buying factors such as species, grading, volume (are you buying wholesale packs or smaller quantities  at ‘broken pack rates’), lengths and sectional sizes coming into play.

In terms of delivery, are you having the stock delivered to you or are you going to collect it? Delivery to metro areas can run to $150 per pack, but only if you have access to a fork onsite, otherwise you’ll be up for the increased cost of a crane truck, which is substantially higher. If you’re outside a metro area, then these costs will increase. To counter this you could choose to collect yourself, if your supplier allows this, and also if you can justify the time cost.

Remember also to factor in any secondary stock for running test cuts, as well as contemporary materials such as veneered sheets.

Tooling costs, if the purchase of which is to achieve a specific element of a job, must be considered. For example, for some jobs over the years I’ve had custom spindle tooling made, sawblades ground to specific angles and for one job I needed nine of the same router bit for a repetitive templating task.

Consumable items are those which are required to complete a task but are not necessarily visible and often throw-away once a process is complete. Believe me when I say these elements add up – fast! Try it for yourself, next time you build a piece, keep a tally of these items and I’m confident you’ll be surprised at the total. I’ve had jobs where these elements have tallied into the thousands of dollars, so you need to consider this section seriously.

Items I consider in this section include, but certainly aren’t limited to –

• Tapes (clear packing, blue painters, veneering gum tape etc)
• Adhesives
• Abrasives
• Sheet goods for templates, jigs
• Polishing and finishing products
• Rags and butchers paper
• PPE such as disposable gloves
• Accessories such as lighting and other fixtures, handles etc
• Hardware and fixings, including hinges, drawer slides and down to screws/washers etc
• Shop vac and dust collector bags
• Domino tenons, Lamello fixings, dowels etc
• Sharpening – is your job going to essentially end the working life of your current tooling edges?

Above: Streamlining and batching processes will save time. 

Labour costs

Time is our most valuable, yet under- appreciated resource in the shop. You simply must be able to accurately project how long it is going to take you to make your piece. If you get this wrong, you face the prospect of working substantial periods of time for zero return.

My strongest recommendation is to start keeping time sheets as you build your projects. Detailed, accurate and itemised by every single process. Again, I think many of you will be surprised by the totals that come out on your tallies. Regardless of whether you’re doing a technically complex custom one-off project or running a regular production run, you need to know how long each individual process will take you.

Sure, a cut on the tablesaw may take you 10 seconds to run, but what if you need to repeat this cut 500–1000 times? Before long you’re spending hours at the saw, and this is just on one process. Compound this out with potentially dozens of processes throughout the job and the time element builds, and quickly.

But so far we’ve only considered the actual cuts themselves. Other time factors to consider include:

• Unloading/unwrapping and inspecting your delivered stock, including checking for and removing metal
• Stock assessment/measuring and docking
• Dressing/resawing/sizing
• Design and making of jigs and templates
• Machine set-ups – tooling changes, jig installation and security, test cuts
• Prototyping and other proof-of-concept processes
• Testing of proposed finish/making up sample boards
• Setup/execution and pack-up of glue-ups and other assemblies
• Detailing and surface preparation of planes and edges
• Polishing/finishing
• Layout and installation of hardware and fixtures
• Preparation for and execution of freight consignments
• Waste disposal – don’t laugh, I once did a job where I needed to empty my dust collector bags 27 times in three days. At five minutes each occurrence, that’s 2.25 hours potentially involved, but I saw this coming and ensured I was recompensed for my time
• Delivery and installation

Waste is a topic in its own right. You can end up paying twice for the wood, first to acquire and then to dispose of it. Planning will minimise material usage.

I recently did a job which required me to make 500 identical pieces that each required 12 processes to be completed, many of which required the design, making and testing/ calibration of jigs and templates at three separate machines. The cumulative effect of this was a substantial time investment that, had I failed to accurately project, I would have rapidly fallen into the red.

For experienced makers routine processes can be very accurately projected, but I still recommend time sheets be kept, especially for those newer to, or looking to get into the industry.

So when it comes to quoting the labour/time element of a piece, I will quite simply sit down and mentally visualise each and every step of the build process, from unloading the timber off the truck to delivery and install. I find this process to have other non-tangible benefits as well, such as resolving joinery issues and process sequencing factors that could otherwise potentially have resulted in errors or lost time had they not been considered in advance in this fashion. This visualisation is then listed out on a spreadsheet and a time factor assigned to every single process.

Depending on the scale and complexity of a piece I will sometimes consider a contingency element as well, for example adding 5–10% of the total time tally. This can go towards accounting for those unforeseen circumstances such as needing to repair a damaged section of stock that was not visibly obvious prior to cutting, or removing undetected metal such as old bullets (yes, I’ve had that one too, five in one job earlier this year, all of which were required to be removed and patched with inlays).

I’m sure by now you can see that I greatly value my time and how it is accounted for in the costing process. What I’ve consciously not discussed is how to calculate your hourly rate for billing purposes – that will hopefully be the subject of a future article.

Batch work brings down the price per unit but there are unseen costs for time and materials spent on making jigs and testing set-ups. Factor in also the number and flow of machine processes required.

Delivery and freighting

You may find yourself pricing a job that could have unique logistical circumstances or requirements that need to be accounted for.

Are you shipping or freighting the piece? If so, you’ll need to get a service summary/quote from your chosen provider to consider and factor in. Is it going international? ...in which case you may need to research and factor in destination legalities and requirements such as customs bonding and clearance, phytosanitary or other biological clearances and declarations, import duties and taxes.

Boxes are a favourite item to make – the ones shown here were made from walnut and figured maple. Details add value but require a greater time input. Keeping a record of time taken will allow you to plan better for future projects and commissions. Photo: Frank Pronesti

You may need to factor in the time and materials to design and make a custom crate as well. There are companies that specialise in this process if you don’t want to do it yourself. If you make your own, remember to make it material handling equipment (MHE) compatible.

If delivering the piece yourself, consider your time to load and secure the piece, as well as transit time to/ from the destination and time onsite to unload and install the item. In extreme situations, you may need to consider contracting a traffic control company to temporarily block a street and even a crane to lift a larger piece into position, or even just some short-term labour to assist you.

Ellipse Coffee Table, butternut, walnut, figured maple and Gabon ebony. Subtle details are satisfying but labour intensive – the concentric elliptical inlays on this tabletop were created from 120 hand fitted parts. The elliptical legs were hand shaped. Photos: Frank Pronesti

Fixed-price contracts?

With experience, you can get to the point where your estimates are very accurate, and you’ll find the quoting process less intimidating and stressful, especially for simpler or reproduced pieces. In this case you can offer fixed-price contracts with confidence. For pieces made for the first time that are technically complex or are larger in cost scale, I will consider offering clients a price range, with the lower end being the absolute minimum I think I can offer the piece for, and the higher end allowing for contingencies such as additional time taken on a given process for example.

Entryway console with ‘floating’ case and sliding doors in cherry and walnut. Waterfall grain on the carcase, quarter-matched veneered and mitred framed door panels, hand shaped pulls, exposed wedged tenon joinery – once again costs in terms of time inputs quickly mount. Photo: Naman Briner

In summary...

There are many more factors to consider in pricing your work than appear at face value, and I suspect many would be surprised at the final numbers that come out. Do your planning and research, keep and maintain records, time sheets and bills of materials and you’ll be on the way to successfully and confidently pricing your work. Remember, the numbers don’t lie – look after them and they’ll surely look after you.

Damion Fauser @damionfauser is a furniture designer maker and woodwork teacher in Brisbane. Learn more at http://damionfauser.com/