[amayausers] Re: how to figure pricing
- From: "Roland R. Irish III" <signman@xxxxxxxxxxxxxxxxxxx>
- To: <amayausers@xxxxxxxxxxxxx>
- Date: Thu, 29 Dec 2005 08:45:45 -0500
To figure out your pricing for transfers (almost the same as screenprinting
but lower quantities)
you need to establish:
1) NET COST- this is YOUR cost including freight, shipping, handling, per
PIECE or item <transfer, tee shirt, hangers, bags, boxes-anything needed to
produce that item
2) OPERATING COSTS- how much does it COST YOU to operate your shop-take
your 'yearly' expenses-heat, lights, phone, insurance, payroll-add it up,
and divide to find out what your 'operating cost' PER HOUR for a 40 hour
week really is.
then you take your PRODUCT cost (the NET COST) and multiple by 3 (on
average) and that would be your RETAIL single item cost. Remember-YOU have
to markup a profit on the shirt, the decal, the embroidery-no different than
if the customer bought the shirt somewhere else and brought it to you-the
store they bought it from made that profit-so should you!
Take this new 'retail' figure and multiple by how many PER HOUR you can
produce. IF this $ amount is NOT equal to double your 'OPERATING COST', then
you are losing money! It should equal at least double-so you can meet your
costs and then make a profit.
Average 'hourly' rates should be in the $40-$50 per hour-just check your
local auto dealership and see how much THEY charge you per hour-its up over
$70 in most places!
Now that you have established your RETAIL single item cost-you can figure
out a quantity discount schedule.
I have discount rates based on less than 12, 12-24, 36-72-144 piece
quantities.
And, I take the Sanmar 'retail priced catalog' prices as a base line-and
mark THEM up- 1-6 pieces add 20%, 7-11 pieces add 15%, 12 or more, catalog
price. I have had NO problems with customers objecting-I printed off labels
and put it on every catalog we hand out. This has resulted in my average
order now 12 or more!
Remember-you can't give away your time-and your equipment is not running
24/7. That's why you do all your math figuring a 40 hour week.
Roland
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