Q on pricing parts that eat up a sheet w/o using it all

[motoguy]

I've got a question on pricing. I'm making a 48" clock for a co-worker of my wife. The actual pricing for this person isn't really a consideration, but I'm curious about figuring this if it were to come up again. Here's the parts on the sheet:

sheet layout.JPG

It's a 48 inch clock. 3 clock panels, 3 mounting brackets on the back. That's a 48.375 x 120 sheet. Obviously, it pretty much kills the sheet, even though it leaves 2 large dropped areas that could be used for something else (indeed, on the actual sheet to cut, I'll have some other objects in there). However, for the sake of argument, let's say I have nothing else to put in there...they'll just be drops.

I priced this a couple of ways, using the Jim Colt price method (pricing app provided by davek0974 here). First way is as you see on the sheet...all parts on the sheet. Parts only, spray paint (patina) checked at $70/sq yd, the total price is $600.79. We're just talking cutting and finish...no design time, welding, etc being figured here.

nested sheet pricing.JPG

If I price each part individually (backer plate, middle plate, clock face, and hangers), I come up with a price of $534.12. Approx $70, or just over 10%, difference.

I know why, of course. In the "all parts on one sheet" price, the customer is being charged for the drop material, as well as paint/patina for the dropped area. When figured individually, the customer is being charged for some drop (the area between the circles, and a rectangle that would enclose it), as well as paint/patina on that same drop. They are, however, being charged for much less material. Well, roughly a $70 difference with material and paint charge.

So...how would you calculate this? The "all on one sheet" method seems a bit unfair to the customer, as they're paying for material (and more of an issue, paint/patina) that they're not using. However, this job does kill a 4x10 sheet of material, and I pay for the whole sheet no matter what.

So...make customer pay for everything? Or charge as close as possible to only what the customer gets, and if I'm not efficient enough to fill the "drop" areas with product, then it's my loss? Or another alternative?

It's not really an issue for this particular job, however I'd like to have an idea of how to handle this when I run across it again (and again and again, I'm sure). I'd appreciate input from the grizzled vets, on how you approach this situation.

[tnbndr]

Well, not sure about being a "grizzled vet" but I myself would charge the customer for the entire sheet.
I don't like drops, storing them, moving them around 100 times before they get used so I charge for the inconvenience.!!!!

[exapprentice]

Hi motoguy

You said it all "The "all on one sheet" method seems a bit unfair to the customer" but in business what is more unfair:

Is you making a loss in your income.

When you get right down to all the nuts and bolts of trying to be profitable then being fair is good but then making a loss is really not good, only you as the guy or girl pulling the strings, doing all that work that no one else see's, taking the risks and funding the show up front let alone all the personnel time and costs you invested in getting it all up and running

I make sure I cover my costs first and after that a little profit is a good thing?

I agree with tnbndr: "Well, not sure about being a "grizzled vet" but I myself would charge the customer for the entire sheet.
I don't like drops, storing them, moving them around 100 times before they get used so I charge for the inconvenience.!!!!"

because that really happens in my shop anyway
(all the hassle just trying to be fair and save a few bucks is it really worth it)

[Shane Warnick]

76-80%, that's where it breaks over for me. Once the parts take up 75-80% then the customer buys the sheet. On the drawing above, it's theirs. If I can cut some other stuff out of that space, I call that gravy. I think the price you have is fair, for cutting and material. I would be around $300 for 14g. Now, I would add time for design if warranted. I think where you are concerned (and rightfully so) is the finishing cost, or more so, using the same material size to figure finishing cost, when it's really only 70% or so of the sheet size, maybe less. I only charge for finish on actual part size. I think this is one reason people struggle with pricing there is no one size fits all.

All that being said, it's not unusual for finishing to be almost equal to, or in some instances, a little more, than material and cutting costs on a completed project. As an example, I have something I sell a lot of, each one personalized. Approx 24" x 24", raw is $60 for 14g, with powdercoat and its $105. The catch is that since each piece is personalized, I added a $20 cad fee into each one, and they only run around $40 each for material and cutting without the cad fee. So, in this case, powdercoat is $45, or $5 more than the actual material and cutting cost.

All things considered, I wouldn't even flinch at telling someone a CUSTOM 48" clock, finished, with the clock works installed etc, would be in the $800-$1000 range. Almost all of the large clocks you can find for sale, are made from high density polyurethane not metal. They usually run $300-500, plus shipping, which is $150-200 depending on size. So, for $500-700 they can have clock that's plastic, or for $800-1000 one that will be handed down to the grandkids.

On a side note, I would figure weight on the cut pieces, and if it's was going to be too heavy, consider making it from 0.080 or 0.125" aluminum. It paints and powder coats just as good as steel, and while it's a little more expensive, it's a whole lot lighter.

Shane

[motoguy]

76-80%, that's where it breaks over for me. Once the parts take up 75-80% then the customer buys the sheet. On the drawing above, it's theirs. If I can cut some other stuff out of that space, I call that gravy. I think the price you have is fair, for cutting and material. I would be around $300 for 14g. Now, I would add time for design if warranted. I think where you are concerned (and rightfully so) is the finishing cost, or more so, using the same material size to figure finishing cost, when it's really only 70% or so of the sheet size, maybe less. I only charge for finish on actual part size. I think this is one reason people struggle with pricing there is no one size fits all.

As usual, you are correct. I'm ok with charging for all the material. That seems more like just part of the game. The material is going to be cut up, regardless. Charging to finish material that's not going to be finished, though...not such a fan of that.

All that being said, it's not unusual for finishing to be almost equal to, or in some instances, a little more, than material and cutting costs on a completed project. As an example, I have something I sell a lot of, each one personalized. Approx 24" x 24", raw is $60 for 14g, with powdercoat and its $105. The catch is that since each piece is personalized, I added a $20 cad fee into each one, and they only run around $40 each for material and cutting without the cad fee. So, in this case, powdercoat is $45, or $5 more than the actual material and cutting cost.

I'm beginning to see that too. It kind of makes sense, though...because I hate the finish work. LOL

All things considered, I wouldn't even flinch at telling someone a CUSTOM 48" clock, finished, with the clock works installed etc, would be in the $800-$1000 range. Almost all of the large clocks you can find for sale, are made from high density polyurethane not metal. They usually run $300-500, plus shipping, which is $150-200 depending on size. So, for $500-700 they can have clock that's plastic, or for $800-1000 one that will be handed down to the grandkids.

Yeah, when I factor in the clockworks (x2), figure 2 hours of drawing time, welding/brake time for the hangers, etc...it'll be bumping just over $800. Sounds INSANE to me...but, I have the BAD problem of looking at my product, and viewing it through the filter of "what would *I* pay for that?" Being 1) cheap, and 2) a DIY kind a guy...I wouldn't pay much.

On a side note, I would figure weight on the cut pieces, and if it's was going to be too heavy, consider making it from 0.080 or 0.125" aluminum. It paints and powder coats just as good as steel, and while it's a little more expensive, it's a whole lot lighter.

Shane

It's going to be about 40lbs. I cut those massive sawtooth hangers to be mounted on the back, so the clock can be mounted to the studs. I considered going with AL (my only AL experience is .125), but they want the patina finish...which I don't know how to do on AL. The funny part is, I've got a powder set up (gun, 4x4x6 oven, etc), but I've not been able to take the time to use it. Something like this would be a prime candidate for AL and some hammered copper powder, etc.

I've been busting ass the past few days to get caught up on backlogged stuff. I'm nearly there. Next, I've got to figure out the disconnect that exists while working my butt off, but STILL being broke. lol

[Gamelord]

I charge for the entire sheet, if the layouts take up the entire sheet. IF they want the drops back that's fine. If not then bonus for me.