Welcome to the last episode of Furniture Painting 101. We did a covered a little on this topic in episode 2. For this episode, I will be sharing in greater detail how to price your pieces for profit.
The Pricing Formula
Over the years I have tried a few different methods of keeping track of the information for each flip. For example, jotting everything down into a notebook or thinking I would simply remember things without writing them down. (And trust me you do forget a few things, so I do not recommend that method!). I have narrowed it down to using a form that I keep on my computer, and complete it with each project, then print it out for my binder. I am sharing a free downloadable copy for you on my blog, as well as a Care Card. .
Using a template like this one keeps you on track for listing each item that you use, and the expense. I also keep a copy on my computer. It can be printed and written directly on, or even better, add the information before you print it. Especially once you start adding the calculations. I know from my own experience, that sometimes when I look back I can barely read my own writing, it can get a little messy when you’re in a hurry to jot something down.
The first place I start is with a before and after photo. It is great to have a visual reference for the work that was done on the piece. Having before and after photos is also a convenient way to show your work, and to have a quick price reference if you are creating something similar.
Once you have filled in all of the details, put them in a three-ring binder to keep them organized and easy to navigate when you have to reference back to it when trying to match another piece, or create something similar. It will save you a great deal of time, by having a detailed list of products used and the expenses it took to create the original piece.
Date, Purchase Location & Expenses
The first thing you will be documenting is the date and place of purchase. I calculate about 50 cents a mile for miles driven. If it was a day trip and you needed to include a lunch that can be calculated as an expense, and on your taxes. This all needs to be added to the cost of the piece.
Write down everything. Did you first find it on Marketplace? Did you get it from a person, or a business? Was there a lot of similar inventory there? Any story behind the piece? (People love stories!)
When documenting your supplies, it is important to remember to use retail prices when calculating your supply list, if you are a paint retailer. You may not always use the entire jar, so you can calculate accordingly. (specific examples in the video on how I calculate this). Make sure to calculate all of the supplies that you are using. Each product cost money, if you are not calculating them, then you could lose money. (Sponges, stencils, etc.)
Labor includes more than just the time spent painting. There are so many more hours that go into your work than painting time. The time it takes for you to search the internet for the right piece, the drive to pick up the piece, load it, drive back, & unload it. In addition to cleaning, repairing, and all the prep work done to the piece before painting it. Stencil, transfers, wax, and any other details you may add. Then you include the time it takes to list it. Make sure to also calculate the time it will take to plan pickup, delivery, or shipping with UShip.
Calculating Your Rate
I calculate my labor at $20.00 per hour. That rate includes all the time and undivided attention I spend on each piece to find it, create it, finish it, sell it, and get it delivered. Other fees you need to consider are listing fees, credit card fees, and vendor mall fees. I calculate 10% on average for these fees.
For my business profit, I calculate at 35%. This is not the same as labor. I am not Sisterhood Of The Traveling Brush, that is my business. I, Terri Stovall, am paid for my labor by Sisterhood, but that is only one of the business’ expenses. In order to make a profit, pay expenses of insurance, electricity, rent, taxes, and all of the other expenses that come along with the business end of it, the business needs money, too. At the end of the year, there needs to be something left for profit, or it is a hobby, not a business.
Calculate all of these recurring expenses annually, and divide it by months worked, and average pieces per month, to see what percentage that you need to include with each piece, yo gain an annual profit. That is your percentage to add to the sales price of each piece. Average is 35-45%, depending on your market.
I hope this was helpful for you! You can view the step-by-step details here in my video.