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Thread: Pricing Strategies

  1. #16
    Join Date
    Mar 2003
    Location
    SE PA - Central Bucks County
    Posts
    49,616
    Quote Originally Posted by Rodger MacMunn View Post
    ..... low overhead should mean "higher profits"' ..... not undercutting prices.
    This is really, really important!
    --

    The most expensive tool is the one you buy "cheaply" and often...

  2. #17
    To add to what Rodger said, if you imagine that you had 100K cash money today, option 1 you buy a cnc and ancillary equipment, market, sell work, build, etc... OR you take that 100k and invest it...

    At 8% annual compound, in 15 years your earn $217,000.00. So over the life of the 100k investment in the cnc youd hope to come out with that as a bare minimum (a net break even).

    Making 15K a year cash in the bank from the cnc sounds easy but it needs to be 15k clear after you've paid yourself. Because youd have made the 217k sitting on your duff with the money in the bank lol.
    Sometimes I just want to look at pretty pictures,... Thats when I go to the Turners Forum

  3. #18
    Mark Bolton ... that's really bad advice .... IF I had $100k sitting in the bank, & I was sitting around doing absolutely nothing, I'd invest it in some fine single malt scotch whisky. 10 years later, I'd be completely broke ........ LOL
    My oldest grandson went with me on an "install" a few years back when he was about 9. It was 85 miles from here, & we ate twice. He had pancakes & maple syrup TWICE! I said "you have a sweet tooth " ..... he replied "you have a scotch tooth". No respect LOL

  4. #19
    Quote Originally Posted by Rodger MacMunn View Post
    he replied "you have a scotch tooth". No respect LOL
    Kids.. they just dont get it lol.
    Sometimes I just want to look at pretty pictures,... Thats when I go to the Turners Forum

  5. #20
    Join Date
    Jun 2018
    Location
    Racine Ohio
    Posts
    47
    Thanks for the added information guys. I really didn't mean to sound like I was just doing the little things at bare bones minimum, in my area i feel i'm charging what the market will bare but i guess that's the whole point of this thread to get insight from those who have done this for awhile to verify that i'm not the low baller. One because its not fair to other shops " which there aren't any that I know of " besides Marks shop and he is a good ways away from me" and two even though i have low overhead i am still in business, to stay in business and don't want to leave money on the table. But at the same time I don't wanna be greedy and price myself out of the market. Its a balancing act and then you throw in pancakes and scotch and who know what will happen lol.

  6. #21
    Join Date
    Mar 2003
    Location
    SE PA - Central Bucks County
    Posts
    49,616
    I hope a really good red wine is an acceptable substitute for the Scotch...
    --

    The most expensive tool is the one you buy "cheaply" and often...

  7. #22
    I had problems with pricing myself with one offs. I didn't want to lose money but was always concerned about sounding greedy and scaring people away. I finally settled on figuring out what it was worth to me if I were buying, knowing the work involved. Sometimes the margins would be small and sometimes things would demand a higher margin than if I had just based on costs and a markup percentage.

    I stopped working if my price would scare them away because most of the time they have no idea what all is involved in making the item. If they questioned my pricing I would tell them all the things that add up the amount of time spent plus in a polite way tell them that they could always but their open cnc, spend months learning software and throw dollars away in what became firewood while I was learning.

    People are cheap. If nobody walks away after you quite a price then you are probably to cheap.

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