Tpt life Posted November 7, 2013 Report Share Posted November 7, 2013 Krt, you make reasonable sense but you are working on a different business model. If you are batching boxes that is not quite the same as furniture commissions. I think for your business model you are planning in an ethical way that keeps your product moving. In a one-off build you have to be realistic about how much you can sell that half sheet for. I cannot get more than a few dollars for a half sheet in this market. I can pay for premium ply for a project but second hand, half-sheet buyers do not care. I might be able to work that half into another commission piece but it sits in my shop during the wait. Sure enough it gets cut for shop furniture or a jig. At that point the value is not premium in nature. When you compare a 15-25% waste material to end product cost (after labor) you are really talking about a 5-7% increase in final cost. Around here the guys who start sniping work by undercutting reputable shops by 10% are often out of business in around three years. There is a long and documented history of this kind of behavior. Quote Link to comment Share on other sites More sharing options...
krtwood Posted November 7, 2013 Report Share Posted November 7, 2013 You could always try to convince the customer with "I'm going to have a half sheet of plywood left over, so I could make you a matching widget for a discount rate." No waste, share machine setups for both projects where possible. If they passed then I guess I would feel better about charging them for the two full sheets Quote Link to comment Share on other sites More sharing options...
Spencer_J Posted November 8, 2013 Report Share Posted November 8, 2013 Charge for both sheets. You can use the half sheet for jigs, drawers, boxes, family gifts etc. i hope you are charging for your time, travel expenses, shop time, and anything else you pay for to get the job done. Quote Link to comment Share on other sites More sharing options...
Popular Post dwacker Posted November 8, 2013 Popular Post Report Share Posted November 8, 2013 You could always try to convince the customer with "I'm going to have a half sheet of plywood left over, so I could make you a matching widget for a discount rate." No waste, share machine setups for both projects where possible. If they passed then I guess I would feel better about charging them for the two full sheets To much information is not a good thing. The price is the price learn how to price properly and you don't have to worry about right and wrong moral issues. Its going to cost "this" much take it or leave it. I price all my cabinets by the LF and thats all the extra information the customer gets. The customer is not buying raw materials and labor they are buying a finished product. All the detail and my profit margin are really none of their business. Part of being in business is understanding your market and how price your finished goods. Some areas have a great GPM and some like arts and crafts have a very low GPM. For example: I just say mam your upper cabinets are going to run you $325 per foot, you have 20 feet thats $6500. Your lowers are a bit more expensive at $385 per foot you have 20 feet that brings us to $14200+ tax and installation. Thats it, thats all she need to know, she does not need to know how much extra plywood I have laying around my shop. 3 Quote Link to comment Share on other sites More sharing options...
Beechwood Chip Posted November 9, 2013 Report Share Posted November 9, 2013 When I bought my granite kitchen counter they just gave a me a price and that's what I paid. When they delivered it they said, "We had an extra piece so we made you a cutting board." So now I have a granite cutting board that matches my kitchen counter. It didn't figure in the price, but I thought it was a nice gesture. I'm not going to let my knives touch the granite cutting board, but I'll use it as a hot plate or something. 2 Quote Link to comment Share on other sites More sharing options...
krtwood Posted November 9, 2013 Report Share Posted November 9, 2013 To much information is not a good thing. The price is the price learn how to price properly and you don't have to worry about right and wrong moral issues. Its going to cost "this" much take it or leave it. I price all my cabinets by the LF and thats all the extra information the customer gets. The customer is not buying raw materials and labor they are buying a finished product. All the detail and my profit margin are really none of their business. Part of being in business is understanding your market and how price your finished goods. Some areas have a great GPM and some like arts and crafts have a very low GPM. For example: I just say mam your upper cabinets are going to run you $325 per foot, you have 20 feet thats $6500. Your lowers are a bit more expensive at $385 per foot you have 20 feet that brings us to $14200+ tax and installation. Thats it, thats all she need to know, she does not need to know how much extra plywood I have laying around my shop. I don't know where that came from. There's a difference between negotiating pricing and what I suggested, which was to use the situation as a segue into trying to get more work from the customer. I'm quite comfortable with pricing in my niche. It took a while to get there. I guess a watershed moment was when I had a guy contact me about buying the two most expensive items I had listed at the time and he was going to tell me the price he was going to pay. He also gave me a spiel about how since one box was bigger than the other he'd have his daughters arguing over them. So I offered to build two boxes the same smaller size in the same style for him for his price. No, no, it had to be those two boxes and he was still going to tell me how much he was going to pay. It was hard to pass up a sure sale at the time, things were slow, but I told him the price was firm and he walked. I ended up selling both at full price within two months. Quote Link to comment Share on other sites More sharing options...
wdwerker Posted November 9, 2013 Report Share Posted November 9, 2013 Once you give someone like that their way they think they own you. Kudos for standing your ground! Quote Link to comment Share on other sites More sharing options...
Ozwald Posted November 10, 2013 Report Share Posted November 10, 2013 I'll hook someone up for buying multiple pieces (I sell smaller stuff, not furniture yet), but that's my decision, not theirs. If they're just buying a couple pieces I might knock a little off shipping, for several I might throw in an ink pen that matches the products they bought. That's for personal shoppers, for my wholesale customers are already getting a good enough deal since they can sell at close to the same price as me & still make their profit. I don't make as much per piece, but it results in bigger orders & I don't have to deal with the customer directly. 1 Quote Link to comment Share on other sites More sharing options...
dustyshop Posted November 25, 2013 Report Share Posted November 25, 2013 I didnt read every post but trust me I"ve been workin formyself a long time charge the full material and add some for time and effort do good quality work and be very nice clean up the job site very good protect all your customers things in short the word gets around and you'll have plenty of work some pay good some ya break even some you lose some in the end we enjoy what we do and make a living enjoy the journey brother dont micro manage and feel bad about a half a sheet of ply Quote Link to comment Share on other sites More sharing options...
Popular Post Eric. Posted November 25, 2013 Popular Post Report Share Posted November 25, 2013 8 Quote Link to comment Share on other sites More sharing options...
T-astragal Posted November 28, 2013 Report Share Posted November 28, 2013 I don't think anyone has mentioned "opportunity cost". I haven't studied business, but as I understand it "opportunity cost" is the cost of missed opportunities, usually from not having enough cash to take advantage of them. If you buy a sheet of plywood and use half immediately, and later use the other half, then you've had cash tied up in that half sheet of plywood for the time that it has spent in your shop waiting to be used. That was cash that couldn't be used for something else during that time, so there's an opportunity cost. One half sheet of plywood isn't going to kill you, but if you have too much money tied up in stuff you can't immediately sell, you may end up not being able to pay your bills. Funny you mention it. Yep all the dead assets laying around that are technically valuable and therefore subject to property tax kill me. We keep em, move em, clean em, stack em, count em, work around them only to years later do what we should have done. Throw them away! All balance sheet BS. Rant over. Steve Quote Link to comment Share on other sites More sharing options...
pghmyn Posted November 29, 2013 Report Share Posted November 29, 2013 Can't. Stop. Laughing. Quote Link to comment Share on other sites More sharing options...
jHop Posted December 12, 2013 Report Share Posted December 12, 2013 I've skimmed most of the posts. I'd say if you were planning on doing another project that required the other half sheet, only charge them for the 1.5. If you don't have a project to use the other half sheet, charge them for the 2... and then offer a discount on their next piece. sure, the other half sheet is paid for and laying around until you have a need for it. But you will probably find a use for it real quick. I can buy half sheets locally (not just at BORG or BigBlue), but I pay more than 50% of the cost for one. That's another option for you... charge for 1.75 sheets, to cover the custom cost of needing only half a sheet. Quote Link to comment Share on other sites More sharing options...
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