Pricing & Costing

So hard! Seems to be the one thing that everyone's struggling with. Discussed the various aspects, i.e. value costing, establishing hourly rates, overheads, etc. Profit margin seemed to be the elusive thing andI'm struggling to get my head round the wholesale/retail thing - will ask for more guidance on this. It's just something I've not really experienced yet...

Every group had one common note - that as customers we wouldn't be able to afford what we make! Quite sobering, but it's equally as important not to underprice things, perceptions of value are very odd indeed.

Need to sit and work out:

• annual overheads - utilities, rent, petrol/mileage
• required salary
• materials costs
• how many weeks per year & hours per week I'll be working on jewellery
• % age time making/designing

Then;

annual overheads / hours making per year = hourly overhead rate

annual salary / hours making per year = hourly labout rate

Then;

hourly overhead £ x making hours = £ PLUS

hourly labour rate £ x making hours = £ PLUS

materials costs £ = TOTAL to give the minimum cost price..... phew.

Then add profit...

I've got my work cut out.