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Topic: What's your time worth?
Message: Posted by: MinnesotaChef (Sep 9, 2004 05:38AM)
I have recently been asked to produce a medium sized quantity (12 sets) of an accessory that until recently I have only made for close friends. The party told me the he would pay me "Whatever I think is fair" for my time. The only problem is I've never done this type of thing before, so I don't know what "fair" is. He intends to sell these in his store and I don't know for how much. This is not a serious issue at this time, but it could get that way if this goes further than these 12 sets. I would just like advice on how others have handled this situation. Thank you in advance.
Message: Posted by: Peder Andersson (Sep 9, 2004 07:53AM)
This one is of course very difficult to answer. I think you should make up your mind as to how you should think about making the props. Is it to earn a living or just something you do for fun?

If it is something you do for fun, then maybe $10 per hour is reasonable. If you have to make a living then maybe you have to charge five to fifteen times that amount.

There is also the question of how much you think the accessories are worth to the buyer. Can they be sold at a reasonable price if you charge what you want? If there is a big secret involved, maybe you should charge for that too?

I would start at $10 and then multiply that with some factor that only you can decide after having considered the answers to the questions above.

Good luck!
Message: Posted by: Dave Dorsett (Sep 9, 2004 12:00PM)
There are a number of sources for the information you're looking for on the Web or there may be a Small Business Development Center in your town that would have free information on what factors to consider when making these decisions. Check around and find out what various tradespeople in your area do to find that "magic" number. Many will be happy to share with you once they know you aren't going to be in direct competition with them. It's surprising to find out how many lawn mower mechanics, bicycle repair facilities and service agencies routinely have a shop rate of $35-$45 per hour.
Now is one thing but in the future if you make this a full-time thing you'll neeed to figure in a lot of variables such as rent (or a portion thereof), utilities, insurance and then a margin for error.
Be fair to yourself because once costs are established, people are reluctant to make (ahem) wholesale changes.
Message: Posted by: kregg (Sep 9, 2004 01:43PM)
Everyone has a price, never set yours too low.
How complicated are they to build, can anybody build them better? What do similar items cost? Can you sell them without distributing through a dealer? Supply and demand.
Message: Posted by: Reis O'Brien (Sep 9, 2004 03:11PM)
The key is to stick to your price once it is set. Too many times I have let things go cheaper just to be a nice guy. That will get you walked on.
Message: Posted by: Cliffg37 (Sep 9, 2004 07:44PM)
My suggestion: Go to the horses mouth. If the Item is made of wood, go to a cabinet maker and ask openly what his hoursly rate is. If it is metal, go to a metal shop etc. You will probably want to charge less than they do only because they are professionals and you are a home workshop person.

Something else to take in to account, if he can not get them sold, will you still be paid? If someone returns it as defective, (Even if you both know it worked fine when delivered) does he eat the cost or do you?

These may seem like picky questions,but if they are not ironed out up front, then any trouble could cost you money, a reputation, and maybe even a friendship.

Be careful, but have a great time, and go make some money.
Message: Posted by: thegospelmagicman (Sep 9, 2004 08:25PM)
Over the years I have been asked to make copies for people. A good rule of thumb is to take the price of the materials used and triple it. In this case, is the price of materials tripled anywhere near what you feel the item might be worth? Would you pay that much for it? Is it a secret that you think is worth more? A lot to think about here.

Message: Posted by: Jaz (Sep 12, 2004 06:32PM)
I have to agree with thegospelmagicman.
Charge at least twice the amount you pay for materials.
Consider this insurance if something goes wrong. Tools will slowly wear and materials could get accidently get damaged too.

Is it carpentry work? Metal work? Upholstery work?
Maybe you could call around for estimates from these.

In any case charge at least $25 per hour for your skills and time.
Message: Posted by: Leland Stone (Sep 13, 2004 10:52AM)
Hiya, MinnesotaChef:

Of all mythological creatures, the legendary "Fair Price" is the most elusive. Everyone speaks of this beast, yet few have ever actually seen it, let alone adequately defined it. Except for one guy, way back in the 18th Century. Fella named Adam Smith.

Smith said that a "fair price" was whatever the buyer and seller agreed upon (in an open market and free of coercion).

You probably have concerns about making a profit from your friendship -- one of the best reasons for not working for friends, IMO. Not to sound overly cynical, but your friend has no apparent corresponding qualms about taking advantage of your talents; curiously, his friendship is at odds with his request (his admonition to you, "charge whatever you think is fair" is actually a code -- deciphered, it means, "hey, pal, give me a great deal on these").

That being said, I'll close by echoing the other advice on this thread: Have your friend shop the project around at other professional shops, and tell him you'll consider knocking X% off the lowest written bid -- isn't that fair?

Leland Edward Stone
Message: Posted by: George Ledo (Sep 14, 2004 09:40AM)
I've looked into making props for magic shops, and found that several dealers in my area expect to pay 50% of the retail price. This may sound low at first glance, but he does have to pay rent and so forth and still make a profit.

So, the first thing I'd do in your case is ask your friend how much he intends to sell them for. If he's a dealer, he must have an idea, and it's a fair question. Then I'd figure out whether I can (or want to) make the thing for about half that. If I do, then I'd negotiate with him; it may not come out to exactly 50%, but it's a place to start.

The comment above on tripling your material cost is good -- however, if your material cost is a buck and it takes half an hour to make the thing, then it's certainly not worth the effort.

Good luck!
Message: Posted by: MinnesotaChef (Sep 15, 2004 05:54PM)
Thanks for the input. The final result was actually very surprising, he paid MORE than I expected. I had a set amount in mind that I came to from everyone's advice. His first offer was twice that amount! I was all ready to haggle and was not going to back down for nothing! He was very impressed by the quality and said it was worth every cent. Now, we have 3 similar project in the works. I will let everybody in on it when the time is right. Thanks Again for all the support.
Message: Posted by: thegospelmagicman (Sep 15, 2004 09:58PM)
Glad it all worked out! So happy you were able to come to a price and found out he offered you more than you expected!

Message: Posted by: Clifford the Red (Sep 15, 2004 11:54PM)
That is great! Yeah a fair price is not what you charge but what people will pay. There are so many factors that go into cost that it is nearly impossible to factor a "fair price", about all you can do is determine, maybe, you may make some money when the smoke clears. So the moral is to maximize the total return. A high price may sell less units, but give you a better return.

Custom props almost falls into the art realm where it is determined by willingness of people to patronize your art.