Help costing a job

[Kevin Guhman]

Hello all. I own an epilog mini 12x24 45 watt that for the most part has just been sitting. I just started trying to drum up some business for it and did some keychains for a guy in my industrial complex. I called epilog in regards to costing jobs and they sent me here. How do I cost jobs? This project was using the customers’ materials (1/4" acrylic), I did the work to put a vector around his logo, and then cut the parts. Any advice is greatly appreciated! Thanks.



228729

[Dan Mazurak]

Add all of your expenses (overhead) and then add that amount to the profit you would like to make, that equals what you charge the customer.

[Michael Hunter]

Between $1 and $3 per minute for machine time seems fairly typical.
Add to that the time to load the laser, take out all the finished pieces, inspect and pack them at $30 - $40 per hour???

If that sum comes out a bit low, pad it with artwork preparation charge, machine cleaning time, $1 to do the invoice etc. etc..

[Steven Cox]

Michael is close to the money side of things although I'd say between $1 and $5 per minute for machine time. Lower end of the scale for slow stuff and higher end for fast stuff.

When calculating labour charges though, think of this if you were paying an employee. What ever their hourly rate is you need to multiply that by at least 2.5 so you make money and cover costs. You might say I'm not employing anyone but you need to think as if you are, your time as the business owner should be greater than 2.5 times your highest paid employee even if it is a ficticious employee. In my calculations I work on 3.5 times, I don't employ anyone anymore but I run my calculations on if I had to employ someone @ $20 per hour, that way if something happens to me I could still get someone in if needed and still make something on the job.

Having this thinking from the start helps when/if you need to expand.

Hope this helps - Steve.

[Kevin Guhman]

Thanks everyone, this has helped a lot. I costed this out at $35 setup fee, $35 artwork fee (needed to setup the outside vector and invert the image and build the array), then 40 minutes cut time billed at $3/minute. $190 total, and quoted $3 per piece next time using his material. Do you think $3/each for this item is average/reasonable? I used his material. Thanks.

http://img.photobucket.com/albums/v210/kevinlongisland/Examplenexttoruler.jpg

[Joe Hillmann]

What is the difference between the set up fee and the artwork fee?

[Doug Griffith]

What is the difference between the set up fee and the artwork fee?

In my world the set-up fee is one time per production run. Artwork fee is one time per design.

[Dee Gallo]

Kevin,

Welcome to the Creek! Glad to see you are diving in right away with pix of your project.

I think your $3 each quote is reasonable and will result in return biz too. If he orders more next time, it's just as easy for you to make 10 as one. But, as Doug says the artwork fee is a one time deal. I do not charge for set up - that just seems like part of the job to me. Now if you had to make a jig for a hundred of these things to do the backs, let's say, that's a different story.

One question: is that design something your customer came up with? It seems a bit pointy (like danger from stabbing yourself with it) for a keychain that people will put in their pockets. Also, it will be easy to snap a point off from handling in and out of pockets. Just my opinion. What I do if a customer comes in with a bad design idea is steer him towards something else similar but better for the purpose. They usually appreciate the extra effort on your part.

Otherwise, you did a nice job there, keep it up!

cheers, dee

[Joe Pelonio]

I agree with Dee, reasonable price and watch out for liability issues with designs. Acrylic can be as sharp as a knife. One suggestion for pricing is to decide how much your time is worth per hour. When you charge per-minute that includes your total time as well as the machine wear and tear, cost, and electricity. Make sure you are getting paid what you deserve, and unless you are working on something else at the same time, just being there to keep an eye on the run is your labor.