How to work out your hourly rate

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How to work out your hourly rate
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tahir

Joined: 28 Oct 2004
Posts: 45674
Location: Essex

Posted: Wed Mar 14, 07 4:22 pm Post subject:
How's this for a comparison: https://cgi.ebay.com/Handspun-hand-dyed-knitting-yarn-camel-alpaca-silk_W0QQitemZ190091832833QQcategoryZ83944QQcmdZViewItem

tahir

Joined: 28 Oct 2004
Posts: 45674
Location: Essex

Posted: Wed Mar 14, 07 4:23 pm Post subject:
Or is it more like this: https://www.etsy.com/view_listing.php?listing_id=5459694

Stacey

Joined: 18 Jul 2005
Posts: 8380
Location: Kernow

Posted: Wed Mar 14, 07 4:25 pm Post subject:
That's 100g of handspun for about 15 quid. Mine isn't spun - it's just 'fluff' so it'll have to be cheaper I guess eta - mine looks like this

tahir

Joined: 28 Oct 2004
Posts: 45674
Location: Essex

Posted: Wed Mar 14, 07 4:40 pm Post subject:
How much time does spinning take?

Stacey

Joined: 18 Jul 2005
Posts: 8380
Location: Kernow

Posted: Wed Mar 14, 07 5:03 pm Post subject:
Aaaaaages - my handspun earns me about 35p an hour

MarkS

Joined: 01 Aug 2006
Posts: 2626

Posted: Wed Mar 14, 07 5:21 pm Post subject:

Stacey wrote:

jema wrote:

Figuring out the market is 90% of being successful though

And unless you are selling a "commodity" item, the price you can sell at bears very little relationship to the cost of production, and hence is the wrong thing be be concentrating on.

But if I just take the cost of the materials and double it I'll be eraning about a pound an hour

I might be the 10% that makes it despite being no good at priceing

So where is the marketplace for this stuff ? If ebay or similar then a couple of samples as a test is easy - you may even want to use a different name while you play with prices - at this point you havent pushed a brand and if you are uncertain you dont want to pollute the future.
I agree with all of the above about the price having very little to do with your costs. In the end you either get a sensible (for you) price or do different stuff.

If you try price sampling at a physical market only put one or two things out at a time - you dont want someone to buy all your stock because you have massivly underpriced.

chez

Joined: 13 Aug 2006
Posts: 35935
Location: The Hive of the Uberbee, Quantock Hills, Somerset

Posted: Wed Mar 14, 07 5:22 pm Post subject:

Can you work out what kind of salary you think you should realistically be on if someone was paying you to do what you do? And then divide it by 52 weeks in the year and 40 hours in the week ... and that gives you a rough hourly rate to use as a rule of thumb.

I would say it should come out at an absolute minimum of a tenner an hour, in order to also cover all your faffing-about expenses that you don't include when costing each item; eg, petrol, phone bill, heat light & power while you're working, all that kind of stuff.

sally_in_wales
Downsizer Moderator

Joined: 06 Mar 2005
Posts: 20809
Location: sunny wales

Posted: Wed Mar 14, 07 5:31 pm Post subject:

Just as a comparison, Wingham do merino/silk at �3.10 per 100gms and camel/silk at �4 per 100g. I would imagine alpaca /silk would come in about the same price before dyeing, you should charge more for the speciality dye methods that you use. However, whether their prices ae high enough is another matter, just thats the closest comparison from the well knwn suppliers that I could summon up for you.

Remember also that as you get 'bigger' some of your costs will come down, its cheaper for you to dye a pound of fleece than it is to dye just 100g, its less labour intensive to card a batch than dig out the carders and do just a few batts, so the time investment may become proportionally less as you start working on larger batches.

I know for example, that if I'm making a linen shirt to order it takes me all afternoon, however if I batch produce them, cutting out several, sewing all the arms, then all the bodies etc, I can make 8 in a day. Thats a huge difference in labour costs purely by making my process more efficient with less stopping and starting.

That may not be relevant with your products, I know it is with mine though, so I get a better return if I'm really ruthless with myself about how I tackle a big batch of something.

Last edited by sally_in_wales on Wed Mar 14, 07 5:40 pm; edited 1 time in total

tahir

Joined: 28 Oct 2004
Posts: 45674
Location: Essex

Posted: Wed Mar 14, 07 5:37 pm Post subject:
Good points sally.

dpack

Joined: 02 Jul 2005
Posts: 46235
Location: yes

Posted: Wed Mar 14, 07 6:02 pm Post subject:
materials +25 % (fast turnover) or50% (slowturnover) and labour at twice cost per hour (pick a wage and double it ) and delivery if the market goes for it fine ,otherwise tinker with the details until it works or it isnt worth it

Stacey

Joined: 18 Jul 2005
Posts: 8380
Location: Kernow

Posted: Wed Mar 14, 07 9:19 pm Post subject:

sally_in_wales wrote:

Remember also that as you get 'bigger' some of your costs will come down, its cheaper for you to dye a pound of fleece than it is to dye just 100g, its less labour intensive to card a batch than dig out the carders and do just a few batts, so the time investment may become proportionally less as you start working on larger batches.

.

I have a whole alpaca fleece ( 3 actually but only one white one) and a drum carder so it's already large batches. It's the time really. It took me 35 minutes to make 44g. Right now I'm asking myself what my time is worth - I wouldn't be able to comapete with wingham as I assume they have massive machines. I decided to do rovings on the advice of someone who knows I'm doing Wonderwool and Woolfest and who said it would be better to do that than handspun. I think she's right but I need to make sure it pays for itself. I might do a bit of market research via dropped spindle and the blog *strokes chin*

RichardW

Joined: 24 Aug 2006
Posts: 8443
Location: Llyn Peninsular North Wales

Posted: Wed Mar 14, 07 10:07 pm Post subject:

I would look at how much "product" I can produce in a given time.
That will then tell you how much you can supply. If this amount is low then a high price will be warranted as you dont want to sell out quickly. If you can produce loads quickly then sell it cheap or you will drown in the stuff. As a seller you need to charge as much as you can & not just cover min wage for the hours it takes to make that one product. What about all the other hours you will spend working doing stuff like paper work, marketing, packing & posting orders & many more?

Justme

Rob R

Joined: 28 Oct 2004
Posts: 31902
Location: York

Posted: Wed Mar 14, 07 10:10 pm Post subject:
Good points from Justme - if you don't keep an eye on your overheads, you won't keep a roof over your head

sadierhanne

Joined: 14 Mar 2007
Posts: 10

Posted: Thu Mar 15, 07 1:29 am Post subject:

I think that it is incredibly hard to price goods - if i was paid the national minimum for all the hours i worked a week i'd be a millionaire as it is i haven't had a penny of salary in a year.

Your product is lovely, i like the labels - i have been thinking about going into selling craft items, need to approach it slowly - what do you dye the pink wool with?

I think for hand dyed, hand spun wool you should be looking at the cost of your materials inc costs then adding �5 an hours labour so if it took you half an hour to do a ball and �2 in materials charge �4.50 a ball - if that feels cheap then raise the price.

because it is a hand made item i think you can pretty much afford to charge for the exclusiveness of it - i'd make sure that you add a lot of info and explain the process that goes into making it - this way people can really see what they are paying for.

it all looks lovely - do you make your own labels?

xx

sneeuwklokje

Joined: 08 Mar 2006
Posts: 277

Posted: Thu Mar 15, 07 10:14 pm Post subject:

This is an interesting topic and I'm pleased you posted it. It's given me lots to think about too.

Something else that struck me as I was reading through the thread was that because of the colourways and so on that You put together, I think that makes your wools relatively unique? Almost like when an artist paints a picture - how much do you charge for an idea? For the finished product / concept? For your "signature" blend so to say, that would make your stuff instantly recognisable from all others? It's hard. Then again, something can be worth whatever someone is willing to pay for it. *looks for the headache smiley*

I don't know the answers to your question(s). I think at the very least, you are entitled to charge the minimum wage?

Good luck with it though! At least you are out there and doing it.

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