Let's Play "What Would You Charge"

[Kev Williams]

Why is your price different for the same work, different customer?

Because I'm a small business, so I'm familiar with the advantages and disadvantages of small businesses. Some guy trying to market a new idea and needs some parts engraved for his first articles, I'll charge the bare minimum to cover my time, usually no setup charges. Many times I'll do first articles for free. Many of these companies never get off the ground, but many do. And for the most part, those that do get off the ground usually end up getting their parts marked in other ways, or buy their own equipment to do it themselves. Simply due to the fact that my normal prices are too high for high production parts.

So what do I get for cheap work and free samples? Priceless word of mouth advertising. Whether these guys falter or flourish, they never forget that I helped them out. And if they, or someone they know down the road needs some words or logos or graphics put on something, I'm who they remember. Which is why we have never had to advertise, and I'm rarely if ever low on work to do. Years ago I built a 'picture information' website. Almost 2 years ago I took it down. Just 2 days ago I had the online yellow pages remove my name from their list. I can't handle the additional business.

But for bigger established businesses, I'm not afraid to charge 'market rate', even tho I'm still below market rate usually. Case in point, my biggest customer; I charge them less than half what they were paying their own sister company in Austria to build their control panels. They're done right, look great, I get them done on time, I fix any mistakes without question... they will NEVER bother looking elsewhere for a lower price. And I still average over $180 an hour profit on their jobs. Yes I could charge more, but then they MIGHT go looking elsewhere. I know this to be true because 20 years ago, they did. 18 years ago, they came back.

As for customers changing their pay policies to 90 days, no problem for me. If they PAY in 90 days, that's better than having to send 2nd and 3rd and 4th invoices to some of my net 30 customers who're always late. Many years ago one of my long-time customers did the 90 day thing, to help with cash flow issues. Yeah it seemed inconvenient and ballsy, but I wasn't about to turn down their money. And for the past 5 years they've been my 2nd or 3rd best customer, and they're still on net 90. Good money, and they're never late to pay. While my receivables isn't gaining interest (which is offset 6-fold by CC fees anyway), it's still 'money in the bank'.

[Keith Winter]

But for bigger established businesses, I'm not afraid to charge 'market rate', even tho I'm still below market rate usually. Case in point, my biggest customer; I charge them less than half what they were paying their own sister company in Austria to build their control panels. They're done right, look great, I get them done on time, I fix any mistakes without question... they will NEVER bother looking elsewhere for a lower price. And I still average over $180 an hour profit on their jobs. Yes I could charge more, but then they MIGHT go looking elsewhere. I know this to be true because 20 years ago, they did. 18 years ago, they came back.

This is EXACTLY why I wouldn't drop my prices to the floor to get a job. Many times, the two jobs come in around the same time and I'd have to choose between the profitable job or the mega corp job that might repeat over and over. One way or another you're either going to burn a bridge if you say sorry I cannot do that job now, or you're going to break even or loose money on the job you bid low, because you're going to have to hire/pay someone overtime to work a midnight shift on the laser for 60 hours to get it done.

[Joel Ifill]

flat rate around 8-10 per board, flat rate $50 for each pickup, or I would just quote a local delivery service because my time is too important to be stuck in LA traffic for 40 minutes once a week, and I don't have any employees that I want doing that either.

[Scott Shepherd]

Well, there you go Steve, the answer is :

Anywhere from $5-15 per board, hire a delivery driver to deliver them, or take them yourself. Charge a flat rate fee to deliver them, unless you'd rather charge by the mile plus your time. Use them as fill work unless you're busy, if it's a small/medium size company, charge one price, if it's a larger company, charge another price, you can change them out in 5 seconds to 2 minutes each, and depending on the payment terms, you might or might not do the job

Whew.....I'm glad we solved that riddle

[Bert Kemp]

If it was simple what would it be. 500 boards all the same they supplied perfect art work and file, they delivered to your door and they pick them up at your door. and you have 30 days to complete the job. Now what do you charge.

[Keith Winter]

If it was simple what would it be. 500 boards all the same they supplied perfect art work and file, they delivered to your door and they pick them up at your door. and you have 30 days to complete the job. Now what do you charge.

Do I have Employees or not?
Do I work from home or office?
How full are my lasers on average 50%? 80%?
Who pays for mistakes me or the client?
Are they a big client, and is there likely potential for repeat business?

[Bert Kemp]

Answer your own questions and price job

[Keith Winter]

Answer your own questions and price job

Very very rough estimate since the data is better but not complete. Somewhere in the neighborhood of $12-$16 a board if they are covering damages, engraving is all the same, and they are likely a potential repeat customer. This assumes you have the excess capacity and don't have to bump any other jobs.

[Bert Kemp]

The Data is complete Use what I gave you and adjust for you. Your trying to figure out all the variables for everyone then come up with a price for everyone you have to do it for you and your situation. Mine and everyone else will be3 different because were all in different situations.

[Jeffrey Dewing]

$30 bucks dry run??? Then we will see if it works out?

[Bert Kemp]

Holy smoke I'm not comin to you. gessh your in NH that automatically drops it down to $7 a board. dry run what doesa tat mean

$30 bucks dry run??? Then we will see if it works out?

[Jeffrey Dewing]

$7 dollars a pc. to start with... then see where it goes. The first 100 = $700.00. Shipping is really my only issue. I would prob. charge $150.00 dollars a week for pick up and delivery. That is $850.00 x 5 =$4250.00 and my machine would be running about 50 hours. If I could run my machine every week like that I'd make 221,000 dollars a year! I'm really new at this as this is a very new business for me, These figures are low. After reading Keith Winters posts I have to rethink all this! It's all good food for thought.

[Keith Winter]

Bert I thought you were asking for everyone to use the same variables based upon you providing more info, that's why I asked for them. Shame on me for asking for more details I guess?

If you want us to all use different variables that's fine too, just be clear in what you want and relax.

The Data is complete Use what I gave you and adjust for you. Your trying to figure out all the variables for everyone then come up with a price for everyone you have to do it for you and your situation. Mine and everyone else will be3 different because were all in different situations.

[Scott Shepherd]

Just a guess here, but Keith's got 2 Trotec Speedy 300's, and 1 Trotec Speedy 400, along with a couple of rotary engravers, and a number of employees that keep the machines running every day, and I seriously doubt he's misunderstanding how to price things. My guess is he's pricing them a lot more accurately than many others, who aren't doing a fraction of the volume or revenue he's doing.

Maybe there's a lot to learn from his advice on pricing.

[Bert Kemp]

The reason you have to use your own variables is because each persons situation is unique to them. For me I'd be perfectly happy doing that job at $7 a board. At 8 min a board that includes 5+min for engraving and 2+min load and unload or 67 hours total time or 17 hours a week for 4 weeks and $3500 or $42000 a year. For me it works great.
I totally understand it won't work for someone who has a shop, pays employees, pays Ins. and all the other expenses that come with owning and running a business. But hey When I was a working stiff I didn't earn 42k a year

OH Hey Jeff I lived and worked in NH for 45 years so if you can get a job that pays you 42K a year awesome dude.

In 2013 New Hampshire was the state with the fifth highest per capita income in the United States of America, at $33,269 as of the 2013 American Community Survey 1-year estimates.^[1]