the secret formula

After spending the best part of last week having my mind bent with working out quotes this week has thankfully been spent machining timber. That is apart from a day on site fitting two ledge and brace doors. 

With my head clear of figures I feel happy to share with you all my formula for working out a quotation. Although far from perfect it's a good starting point for costing any handmade object. The first equation is easy, simply add up all of the material cost you foresee useing when making the project. Work through the job in your head thinking of each process in turn, it's easy to forget to add things like screws for hinges or oil to finish. With each item listed and costed add them together and then add 10%, remember if you are buying from trade suppliers you should be getting a trade discount which is for you not the client. Also this 10% gives the cost of materials some room to flex if prices happen to change. On this same point always clearly state on any quotation that the price quoted is only good for four weeks. As we all know prices can change quickly, and when they do change its only one way.

So you now have your material costs plus a 10% profit, so now we turn to the less straightforward issue of your daily rate.

In the same way that you listed the materials, draw up a list of all of your monthly out goings both at home and in the workshop. Remember this should include everything from food, insurance, phone/broadband, pension to a clothes allowance. If you are expecting your trade to support you then you must have a clear idea of what you need to earn. However simple your lifestyle this figure will come as a shock. When you are happy that the figure you have in front of you is correct add on 10% because I bet you haven't allowed for savings. Now multiply this number by 12 for months in the year, and then divide this by 240, which gives you a five day working week with six weeks holiday and sick time a year. You now have your daily rate.