Pricing Classes

There are lots of things related to preparing to give instruction whether for a few hours or days.  This is only about the easier element – calculating the costs.

Costs – these are both variable and fixed costs.  These are important in calculating costs per student.

Variable costs. These are the expenses you have no matter how many may attend. E.g.:

Tools – how many people do you intend to cater for?  What kind of tools do you need? Does everyone each need the tool? Can some doubling up occur?

Advertising, promotion – The costs in printing and time to distribute leaflets and other promotional efforts.  Costs of advertising online or in print.

Course Preparation and delivery time – Every course requires time to plan the course and organise the materials, take bookings, set up at venue.  The amount of time you spend delivering the course/class needs to be claimed.

Travel expenses and time to get to the venue.  Mileage expenses only cover the transport costs, it does not include your time.

Venue costs – If you have been invited, check the venue is free to you.  In some cases, you will have to pay for the venue and this needs to be added to your variable costs.  In this case, I am assuming the host is providing the venue free.  If it is your own venue, you should add a sum to cover the overheads of your premises at the very least.

Fixed costs. These are the costs for each person on the class/course.

Materials and consumables. The materials the students will use varies directly with the number of people.  Any provision of food, refreshments will depend on the number.  Any handouts or demonstration materials are also related to the number of people.

Price.  The price of the course/class will depend on the costs and the profit you wish to have as well as what the market will stand.

Working out the Costs

I will go through the main areas of costs and give examples to demonstrate.  Not all these areas will apply.  When they don’t the cost is zero.

Equipment

You can estimate the number of classes over which the tools and any other equipment will last. 

Example

Say, you plan on 6 students and the cost of the tools for that many will cost 440.00 and you expect the tools to last for 10 courses. (you will have to top up on tools due to loss during that period, so you may want to add an additional sum to your calculations.)  Ten classes of 6 gives you 60 people to spread the cost across.  This gives you an individual cost of 7.34 on this basis.

Cost sub total:  7.34/student

Promotion and administration

The promotional effort includes time to prepare, costs to produce and time to distribute.  You can prepare the advertising before the pricing begins, so that amount of time can be known before you start.  The costs of printing or publishing can be determined by getting estimates.  The amount of time you spend in distributing leaflets, and in using the internet to advertise needs to be included in the promotional time. 

I am going to assume your administration of the applications and payments for the course are taken by the venue.  If you do them, you need to add a notional amount of time to cover that aspect of delivering a course.

Example

Say, you have determined the printing and advertising is going to be limited to 50.00.  In addition, you are going to spend 5 hours distributing the printed leaflets and 10 hours of social media time promoting the classes.

As you can see, your time is going to be a large part of this promotional work, so this is the occasion you must decide how much you are going to pay yourself.  There are ways to do this.  Here is one.

Say you have decided that you need to pay yourself 20.00 per hour.  This is the figure that needs to be applied to all the time-based costs you incur in preparing and delivering the class.

The promotional costs for the course are going to be 50.00 plus the 15 hours (distributing leaflets and 10 hours social media) at 20.00 (=300.00) totalling 350.00.  Will this promotion be useful for subsequent classes? Probably not.  This means that you can’t spread the cost over more than one course unless you redesign the materials in some way.  It may be that subsequent classes will require less effort to promote them, but don’t count on it.

Assume your promotion cannot be spread over more than one course, which is the most likely.  This means the cost for each of the six people is 58.34

Cumulative cost sub total:  65.68/student

Preparation

You need to prepare a course syllabus or outline at least.  This will guide you in the presentation of the class and will help you determine the equipment and materials your students will need.  Any additional materials and equipment needed for the course will need to be added to your initial equipment calculations.  You need to keep track of the amount of time you spend on designing the course.

Example

You may have spent 10 hours researching and writing your course.  You can decide that little alteration of the course will be required over the life of the equipment.  This then becomes 200.00 divided by 60 students or 3.34 per student.  You may also have course handouts.  These will be fixed costs as they relate to each student.

Cumulative cost sub total:  69.02/student

Some of these promotional and preparation costs will have to be guesses until experience is gained. How long will the advertising last? One class or more? Will you need additional preparation time each time the class is held?  The answers you give will affect the calculations by the number of students or classes the cost is distributed.

Travel and accommodation

Of course, The travel expenses and time, and the class delivery time will remain relatively constant; varied only by the distance and the facilities at the venue.

Example

The venue is 25 miles away. The travel time is 45 minutes each way. The set-up time is 30 minutes.  The course is for 4 hours and clean-up is 30 minutes.  This means that at 0.50 per mile the expense is 25.00; the travel time is 1.5 hours (1.5*20.00) gives an expense of 30.00 to get to and from the venue.  Set-up and clean-up is 20.00. Class delivery time of 4 hours equals 80.00.  All these on the day costs are 155.00.  For six students, this will be a cost of 25.83 each.

Cumulative variable cost sub total:  94.85/student

Of course, your accommodation expenses for a multiple day course will need to be added, although not the time between class sessions.

Fixed costs are the ones directly related to each student.  These will vary according to venue, style, length etc.

Materials/consumables. The materials the students will use varies directly with the number of people.  The costs of this relate to the materials the students will consume during the class/course.

Example

The glass used by each student will cost 20.00

Additional consumables will be 10.00

Firings for each student will be 5.00

fixed cost sub total:  35.00/student

Hospitality - provision of food, refreshments - will depend on the number. 

Example

Refreshments at the beginning and middle of the course 5.00 each

fixed cost sub total:  40.00/student

Any handouts or demonstration materials are also related to the number of people.

Example

Handouts and examples for students – 10.00

fixed cost sub total:  50.00/student

Student accommodation – this is relevant for those who need to stay overnight either because of their travel or the length of the course.  Normally, this is the responsibility of the student.  It may be that you wish to include the cost of this in the course fee, although that usually makes the course appear to be very expensive.  In this case, I will assume accommodation is the responsibility of the student.

Cumulative variable cost sub total:  94.85/student

Cumulative fixed cost sub total:  50.00/student

Total cost for a one-day, six-person class:  144.85/per student

Profit

You do need to make a profit on this class, or you can’t continue.  You can’t continue with an “at cost” basis, because this is time away from making where you can generate an income.  A small profit margin of 20% is the minimum. It does give you some recompense for your knowledge and provides a small margin for contingencies.

Example.

A margin of 20% on the above example would add 28.97 per student.

Cumulative cost total:  173.82/student

If you feel this does not represent good value for your experience and knowledge, increase the price.  This exercise only provides the base cost level for setting the price.  Also remember that it is easier to reduce prices than it is to increase them.

On the other hand, you may decide that your hourly charges are sufficient profit for the course.  This is not advisable, but is a choice you can make.  You should always be aiming for doing your work on a cost, plus profit basis.  Not simply covering material costs and expenses. Remember your time is also a cost factor.

If you were to feel this is too expensive, there are some ways to reduce expenditure.  The only ones that you cannot reduce are your hourly rate and the profit margin.

Possible reductions include:

Tools and equipment – get the venue to share costs or underwrite costs.

Promotion – reduce your expenditure, or get the venue to take all or most of the promotion costs.

Venue – get them to set-up and clean-up, or better, get the students to do these things.  Get travel expenses from the venue.  Move the venue closer.

Accommodation – get the venue to provide at their cost.

Student numbers – get more students which will reduce the variable cost per student.

But – to repeat – do not reduce your hourly rate, ever.

This is a general introduction to costing, profit, and pricing.  There are a lot of more sophisticated ways of calculating these things, but until a lot of experience is gained, most of the work will be from estimates and guesses.  So, investing in highly detailed methods will not make the pricing more accurate, as all the calculations are based on estimates.

Charges for Repairs

Repairs always cost more than the owner or artist expects on initial inspection.  The cost is very similar to, or more expensive than, the cost of a new panel if the whole has to be taken apart and renewed.

If it is a repair to part of the window or object, you need to be careful that you do not under price.  The cost elements you need to consider are these at minimum:

• Glass
• Materials
• Time
• Overheads
• Travel
• Installation
• Contingencies
• Profit

Glass - and the cost of obtaining it.  Can you obtain the same or very similar glass to the original?  If you can’t, is the client willing to have the repair in different glass?  If you get approval, you need to cost it – whether you already have it or not.  If you do not have it in your stocks, you need to add in the cost of getting it whether that is travel or postal order.  You need to include the time either or both methods involve in the costs.

Materials – The materials you will use in addition to the glass need to be considered.  These include solder, Foil or lead, flux, patina, cleaning materials, etc.

Time - labour and admin. You need to assess how much time it will take to do the repairs.  Then multiply that by your labour rate. You do have one, don’t you?  If not, get down to it and create one. Use steps one and two of this description.   You also need to take into consideration the time to recreate a pattern for the broken area if extensive.

Overheads – If your overheads are not included in your hourly rate, this is the time to include them in the pricing.

Travel = Your mileage rate + time to get there and back.  If you don’t have a mileage rate, look at what your local authority allows.  This will be lower than what businesses allow, but are reasonable, and publicly available.  (At the time of writing the allowance in Scotland is approximately £0.50 per mile.)  It takes time to get to the location, so this needs to be included in the cost too. Of course, if they are willing to bring the item, it reduces the cost to the client.

Installation – If you are expected to install the piece, you need to include travel (there and back at least twice) and time.  You also need to include the estimated time to remove and install a substitute (and its cost) as well as installation of the repaired piece.

Contingencies - All repairs have uncertainties.  You do not always know what the progress of repairing will reveal.  You can agree with the client that any work required in addition to the initial agreement will be notified for the client to decide whether to proceed or not.  However, you can take on the risk. This is what the contingency is for. You need to build allowance for these unforeseen developments.  A 10% to 20% of the total costs addition to the price is sensible if you are taking the risk.

These seven elements added together give you the cost of doing the repairs.  That is the bottom line.  But there is one more element to consider:

Profit – You do expect to get a profit from all this work, don’t you?  If not, why do the repair at all?  You are not a charity.  Of course, you can decide to give away your profit.  Before you do, think about what you have to pay for repairs – to your car, your plumbing, etc.  You deserve some profit on everything you have invested in this craft that you love.  The love will die without profit.

The profit level will depend on your objectives, but will range from 20% (very low) to 100% (what shops charge). If you put your work in a gallery or shop on a sale or return basis, you expect to have to pay at least 30% on the sale.  That should be the minimum basis of your profit level on any repair.



This may all sound like it is too much trouble for a simple repair.  Yes, it does take a bit of consideration to start with.  But once you have established the basic labour, travel, overhead and profit levels, the rest is pretty straight forward.  You will have an idea of how long it takes to do the work, to travel, the glass costs, etc., and the profit level. You only need to multiply by the rates you have established to give you the price.  I should warn you - it will be much higher than you initially thought.

Firing Prices

A number of us with kilns are sometimes asked to fire a piece or several for someone. The question of how much to charge – if anything – quickly comes to the fore.

There are several considerations if you decide to charge - and I think you should. As I go through the cost elements, I include a worked example.

Replacement cost

This is one of the elements least considered in costing a firing. You already have bought the kiln and so it seems like you do not need to consider that cost any longer. At the least, though it is a variable cost – the cost is related to the frequency of use. Fewer uses leads to higher costs for each firing and vice versa.

You can use a discounted cost or a replacement cost for your calculations.

I take the cost of the kin and discount if over five years. Divide the purchase cost by the number of firings per year and you have the cost of each firing spread over five years.

So if the kiln cost you £5,000 – enough for a metre square kiln - and you fire on average 3 times per week this gives 156 firings per year and 780 over the discounting period. This means the depreciation cost of each firing is £6.41 per firing. Of course, if you fire more frequently, the cost per firing comes down.

You can also consider the replacement value after 5 years. If you assume the cost of kilns will increase by 5% per year then your replacement cost will be £6077. So the replacement cost of each firing would be £7.79. This replacement cost is of course a kind of unseen cost of using your kiln. It needs to be accounted for so you can buy a new kiln when you need it.

These considerations show the use costs of the kiln are between £6.41 and £7.79 per firing even before you consider the material costs. For ease of the example, lets round this to £7.10.

Energy Costs

To the replacement cost you need to add the electricity cost per firing. A 30kwh three phase kiln can use around 50kwh for a full fuse firing. If the electricity costs 0.15/kwh, the electricity cost of firing is £7.50. This increases the cost to £14.60

Material costs

If you are covering the shelf with Thinfire, the additional cost will be in the region of another £7. This brings the cumulative charge to £21.60 per firing. Even if you don't use Thinfire or other ceramic fibre paper, you should add 10% for the materials used, but are too small to be accounted for separately – £2.16 – giving £23.76.

Your Time

Then add time that you spend. If you are placing the material in the kiln, or programming the controller, the time that takes needs to be added. If you charge your time out at £20 per hour, you may use a large part of that hour just assisting the person. If you are placing things for the person, the time used will increase. Assume all you have to do is prepare the kiln and shelf and programme the controller – this will take the best part of an hour, so add £20 to the charge. You now are up to £43.76 in costs.

Opportunity Cost

Then add opportunity cost - the price you put on the time you couldn't use the kiln. If it is not putting you out, the opportunity cost is £0. If however, you could have been doing something else in it then you need to charge for the disruption. This is flexible, but might be the cost of one kiln firing. If it is the cost of one firing you add £23.76 giving £67.52.

The firing charge

The minimum you should be charging for others to use your kiln is £43.76. If you consider the disruption and opportunity costs, the price should be at least £67.52 in this example.

What this means for the pricing of your work

These considerations make for an apparently high charge, but shows you what your firings cost you and what should be factored into your charges for kiln formed materials. The minimum you should be adding in this example is £23.76 for each firing for your own work. If you could get four pieces in your kiln and need a fuse and slump firing, each piece has a firing cost of £11.88 (23.76 * 2 / 4). Then you need to add glass costs, time and profit to get the wholesale price. Double that for the retail price.

Fusing is not cheap.

Consultation and Design Fees

Consultation and design fees can be difficult to calculate and ask for, but you are trying to make a living. When you call your accountant or lawyer for advice the clock starts ticking as soon as they start listening. You should not be a whole lot different.

Establish at the beginning that the project includes a specified number of hours of planning/survey/meetings, of agency management, and of creative work. Other things may be added as the project requires. Also establish that exceeding those hours by 10% (or 5% if it’s really big) will incur additional charges.

Once into the project give weekly updates on how much time has been used and the progress achieved. That way, if the client starts adding things or changing their minds, they understand the consequences. If they think it’s worth paying for, great. If not, take it off the table. You can always be generous and waive the extra fees, but giving clients that kind of choice saves a lot of resentment (and time) on both sides.