Remember how much time and effort it took you to get your woodwork done? The last thing you want is to get underpaid or scare off your customers by overcharging your craft. We understand that striking the perfect balance when pricing your woodworking projects can be a challenging task. So, our experts come up with some tips to help.
How To Price Woodworking Projects?
If you’re a furniture maker, finding the perfect balance that enables you to sell your woodcraft or furniture at the right price per project is important. Every artist wants to make money and promote their business, but there’s an art to pricing that you must follow.
So, you’ll understandably not want to sell your products at a low price. At the same time, you want your work to be affordable enough that anyone can get it. There’s no point in having a price if no one can buy from you or willing to pay the set price.
Factors To Consider
The factors below will determine the right price to sell your furniture project, both online and in retail stores. When thinking about selling your woodworking project, keep the following in mind.
Calculate the cost of raw materials
Calculating how much the raw material cost is the most pivotal part of pricing your woodcraft to ensure a profitable business. For this part, you need to add the price of the materials you used. In many cases, these materials include lumber wood, cedarwood, oak wood, etc. They are the go-to materials for furniture and table making, and you’ll most likely be working with them a lot.
Imagine you’re trying to make a coffee table, and you used 30 wood planks during this table project. If a single plank costs $5, the total cost of the material used to make the table will be $150. This alone means you will need to charge at least $150 for the table.
Calculating your price this way makes it easier for you to maintain your business instead of coming up with an inaccurate price. To avoid overpricing or underpricing, this mathematical method might save you a lot.
It will also help if you select the materials carefully. Our experts suggest that you never go for substandard materials as they will only be detrimental to your work’s quality in the long run. At the same time, try to go for a material that isn’t so expensive. This way, you can keep your raw material expenses as low as possible.
The only exception to the second rule is if the work will be for a luxurious customer who has the means to splurge on a woodworking project. In that case, you know they have the money to spend on your furniture and can easily cover your per-hour work fees, raw material prices, and more.
Determine the cost of labor
Your labor cost is the next factor to consider in the business. Beyond the raw materials, you will spend a lot of hours working on custom woodworking projects. Therefore, you need compensation for your time and effort by determining your labor cost. In other words, how long did it take? In terms of time, remember that the base time unit is the hour.
When estimating your fee per hour or day, know your worth and show confidence in your ability to accomplish the task. Think about how long it took you to complete the project, as well as an estimate of what rate you think your skill should fetch at the market.
To obtain the exact estimate of the hours you’ve put in, you need to consider all the tasks you did to complete the project. You also need to estimate the total hour count you spent on each job to add up your hours.
If you charge an hourly rate of $25 per hour and spend 12 hours working on a woodwork project, your labor estimate will be like $300. This will make it easier for you to come up with the perfect hourly rate and hourly cost .
Estimate overhead costs
The overhead cost refers to the rentals of tools, maintenance costs, and all the additional utility costs you incurred over the course of the project. Our experts have found that if the industry average is like 13% for overhead expenses, you can multiply the price of the materials by the industry average.
So, going by the illustration we have above, your overhead average will be $150 (the price of the materials) multiplied by 13 (the industry average for overhead cost).
Your profit is the amount of money you intend to make from your shop work. You use this money to keep your business afloat and fund your expansion, so it is a significant number to consider and not just a simple mark-up.
Again, to calculate this, you need to know the industry average – just as with the overhead cost for your business. So, if the industry average of the woodwork done will take 20%, your profit on the work will be 20% of the total amount from the top three factors (materials, labor, and overhead costs). Getting to know the industry average will ensure that your final selling price doesn’t end up scaring customers away. At the same time, you would be getting proper value for the rate you’re selling.
Estimate costs for selling and marketing
Calculating final products’ selling costs will involve calculating payment for sales rep and marketing. You need marketing professionals to get your product out there and draw customers. These guys will need something in return for their work per hour too.
If you plan to run marketing by yourself, something to consider is the cost when estimating your product’s value. Calculating the marketing cost would involve finding the average of what it took to market your products and the tools involved. Most times, marketing costs would include ads run or sites paid to put your work out there, as well as other marketing tools you used.
Once you factor these into the final price structure for your work, you are well on your way to getting the perfect pricing for it.
Tips For Pricing Woodworking Projects
Finding the appropriate price for your woodworking project might be difficult. However, the following tips can help you out:
Do your research
As we said, don’t just mark up the price on the project once you’re done. Check retail stores to see if other artists are making lumber or other similar products and look at their price ranges. It doesn’t matter if you are selling a table or chairs; try to be within that, but remember your factors and ensure not to sell for too cheap.
Sell at the right places
It’s critical that you look into the right places to sell your piece. These places can be art exhibitions and fairs, as well as art-centric websites that allow you to meet your target market.
Sell at the right places
You probably won’t make any sales if your project isn’t out there. So, ensure to work out an effective marketing strategy. This way, you know you’re getting optimal visibility for what you make. Many projects have been sold through marketing campaigns.
Where To Sell Woodworking Projects
Selling your woodworking products at the right costs can seem complicated. However, if you find a suitable medium, you can easily sell your products to people willing to pay a premium price.
A good sales strategy to take is to sell your custom products to a wholesale store. Wholesale stores get the most customers, and they are your best bet when it comes to getting your product out there. You could decide to sell through a local store, a retail store, or a custom exhibition.
You could also set up an online store for easier sales. Retailers who have shops that offer related items could help you market your woodworking projects, although our experts say going through an online platform is better options than walk-in stores these days.
Fairs are also great for selling your projects since their primary aim is to help people make sales. However, online stores or platforms are still your best bet for now. Most of our lives revolve around the internet these days, and marketing your items on popular social media platforms will go a long way in getting your projects the correct type of exposure, visibility and take less time.
So, online marketing improves your chances of making a sale. With social media, you can make a living by selling custom products to people that actually need your product, wherever they are in the world.
How much should I charge for woodworking?
How much you should charge for woodworking has no one-size-fits-all answer. To know the price to charge for woodworking, you need to find the total costs incurred and how long the project will take. Once you calculate this, you can get a fair price to charge the customer for your items by adding your expected profit.
How do you price a wood project?
To price a woodworking project, you will need to follow our extensive pricing guide above. Once you do that, whatever you get should be good enough. Don’t feel compelled to reduce the price to a level where you make a loss just because you’re trying to appease your customer. However, keep in mind that you could always sell products for cheaper or give discounts on special occasions.
The best way to get how to price woodworking projects is to keep tabs on all the expenses incurred per project. Once a furniture maker does this and adheres to tips on pricing woodworking projects, then they are good to go and can price handmade work. So, go ahead, add every single thing that goes into making that masterpiece in your shop, and charge every single penny. Demand that they pay your worth.