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Re: repair/pricing

A word about general business practices and pricing:

I have found that the range of prices binders are charging for the same
work ranges from the ridiculouly low to the enviable high. While many
prices may cluster in one range, setting your own price based upon what
others are charging may not be appropriate in your particular case.
First we all have to start somewhere, and beginners usually start out
doing low-end work for people unwilling or unable to pay more.
Hopefully, a person in this position knows enough to refer a job to
someone more experienced if the book is very valuable or the problem is
beyond their skills. But for the most part, beginners are not going to
find themselves with extraordinarily rare items on their bench. As
someone mentioned in an earlier post, a lower fee reflects their
expertise and the type of work they are doing is work that probably
wouldn't get done otherwise.  As they gain skill and knowledge, they can
raise their fee appropriately. From my experience, there doesn't seem to
be any shortage of work. Every binder I know has quite a backlog....so
it seems unlikely that this type of work is "being taken out of the
mouths" of more skilled workers. One's fee schedule also tends to be
self-selecting. A higher fee generally brings in higher quality work
(assuming the person is qualified).
  Second, if one wants to continue to be in business, you have to charge
fees that will cover YOUR expenses. As this varies, no one can give you
an answer...you've got to do the calculations with your own data.
Step one: What are your personal annual expenses? What do you want/need
your annual income to be to pay the mortgage, buy food, repair the car,
save for your retirement (I don't remember the source, but speaking of
retirement the protagonist states: "His only preparation for old age was
to hope for an early death".) and pay your taxes (don't forget that
annoying "self-employment tax"...it adds up fast. If you don't need the
money and aren't doing this as your source of income, figure out how
much you would require anyway to meet your personal expenses...how much
is your current salary? Decide how many hours you want to work in a year
(giving yourself time for vacations and a few days to be sick or take
care of other emergencies) and divide that into you annual income. (48
work weeks times 40 hours/week equals 1,920 working hours. Of that
25%-30% of your time is going to be taken up with non-production tasks.
That leaves 1440 billable hours a year. If you want to have a personal
annual income of $35,000 (just to pull a number out of the air) that
means you've got to be earning a net profit of $24.82/hour. Next
determine all the expenses incurred in running a studio...rent or
mortgage, utilities, office supplies, capital equipment purchases etc.,
etc. This is also going to be individual...an earlier post in the
discussion quoted total monthly expenses of $3000/ month. In my case
they are much lower than this, but everyone has to run the calulations
themselves. So let's say in your case you determine your total monthly
business expenses to be $2000/month. That makes $24,000 a year. Combined
with your personal annual income, you find that you have to bring in
$59,000/year cash money to pay for the business and to pay for your own
living expenses. Add another 10% to give yourself breathing room. Now
we're up to $64,900/year. Dividing that by the 1440 billable hours we
determined above you find that you've got to be charging $45.07/hour.
Make less and you're going to have creditors calling you up looking for
payments you don't have the cash to cover. Make more and you can take
that trip to Khatmandu you've always dreamed of.
Step three: how long does it take YOU to do a particular task?
Unfortunately the only way to find out is to time yourself and keep
complete records of it. Peter broke down his time in this way in an
earlier post. You then have the information you need to make an accurate
estimate. If you find that a cloth restoration basically takes you 3
hours, and this book needs an hour of paper repair, you've got to charge
your client $180.28...4 hours at $45.07. (I'm assuming that you have
figured your material costs into your monthly expenses...some people do
it this way, and some, like Peter keep track of materials and time
separately. Either will work.)

So everyone's prices are going to vary based upon their particular
personal and business expenses and how fast or slow they are. If every
potential client refuses to pay your price you have a few options: find
other clients, decrease your expenses, or increase your speed. If your
backlog is 6 months because you're so much cheaper than everyone else,
raise your prices and book that airplane flight. Don't rely on the first
client's response though. In the SAME DAY I've had one potential client
say my prices were insultingly high and that so-and-so would do the same
job for only $x., while an hour before, another client said my prices
were 30% lower than what he was paying elsewhere. Go figure.

Most of us have considered ourselves artists or craftsmen first and have
given little thought about the business aspect of this and may have felt
uncomfortable talking about money with the client.  But if you want to
earn a living, you've got to put on the businessman's hat for just a
while and collect your data and run your calculations. That way you'll
KNOW what to charge instead of just pulling a number out of the air (or
cyberspace) and wondering why the phone bill never gets paid on time.

Well, this has rambled on a bit, but I hope it may be helpful to those
just starting out, and helps to answer the original question that
started this thread. (And I hereby apologize ahead of time if anyone,
anywhere finds some part of what I've said offensive in any way.)

Jack Fitterer

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