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Pricing Items - Labor
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Word count/read time: 602 words; 2-1/2 minutes

Part three of this three-part series deals with labor.

The simple way to clock labor is the time from beginning to end of manufacturing. Sometimes it is more complicated than what a stopwatch says. There's also the time required to be able to make it and all the non-billables like phone conversations, signing up for shows, going to seminars and workshops, ordering and stocking, research, documentation, website maintenance, etc.

For basic situations:
  • Ordering, unpacking, and organizing supplies
  • Set-up and clean-up
  • Assembly
  • Quality control
  • Documentation: pictures, literature, etc.
  • Customer interaction
  • Packaging and shipping

For professionals or the like:
  • Website maintenance
  • Shows or fairs: searching, applying, booth set-up and tear-down, etc.
  • Travel time
  • Making findings, clasps, wire, jump rings, and sheet

Other potential factors (at least to me):
  • Search for and buy (scrap) metals
  • Document and separate sellable and meltable items
  • Prepare scrap: cutting, cleaning, crushing
  • Furnace time: set-up, manning, clean up
  • Ingot time: pouring, cleaning, prepping
  • Refiner: set-up, manning, cleaning, storing
  • Clean, melt, and cast refined metals
  • Make raw materials: hammer forging, rolling mill, wire drawing
  • Make solder and filler wire
  • Weld or solder jump rings
  • Populate and analyze pricing spreadsheet
  • Manufacture custom presentation cases

Those buying pre-made parts can't appreciate what is required to manufacture them. It's convenient, necessary for many, and by no means shameful (but it means your items can not legally be called handmade, let's be clear). However, being at the mercy of whatever the supplier has severely limits the selection, variety, and ultimately quality.

My pricing spreadsheet has a minimum of 75 fields and continually evolves.
Making butted maille is easily measured by start and finish times. Advanced techniques like welding or soldering become a different matter. It might take 100 elapsed minutes to add 20 links. Time is wasted on failed welds and melted links so it might only take 60 actual minutes. Every metric is important, especially failures and wasted time, to know how long it should take for accurate pricing but also how long it really takes for time budgeting.

I time up to 100 links to calculate average, expected, and actual time with best- and worst-case scenarios, standard deviations, and more. I might track 20 separate processes. It's an incentive to improve efficiency since less wasted time results in higher production numbers.

A detailed record and lots of trial and error uncover the fastest way to complete a procedure. Is it an assembly line approach or one-at-a-time? When there are 1000 rings, a few seconds per ring add up to nearly two hours. Save another few moments here and there and that could be a full workday!

Without a way to quantify what is being used (materials) and how long it takes (labor) then money will be lost. My pricing spreadsheet has a minimum of 75 fields and continually evolves. There are formulas for wholesale and retail pricing, rush orders, discounts, and more.

If cost analysis is not thorough then it will produce inaccurate numbers. A business is guaranteed to fail if it can't control costs, identify the bottom line, or establish a break-even number.

Hobbyists who charge little or nothing for their labor ruin it for everyone! The message they convey is that they don't take it seriously and their time (work) is worthless if not substandard. Lowballing devalues the entire market. Some people rely on income from their products; hobbyists' ignorance and selfishness deprive professionals of their livelihood.

Remember, labor and innovation turn $100 of silver into $5,000 worth of earrings or $5 of steel into $300,000 of precision watch components.

Posted by M: May 20, 2020

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