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Pricing - Measuring the cost of time


#1

I have a question. How does one measure time of labor most
efficiently? I never can keep track of how long something took me to
make since I break a lot in between. I was thinking of a chess time
or some sort of stop watch. Do jewelers use anything?

Monica


#2

Yeah, just use a clock, write down what time you start and stop for
breaks. That way you dont lose track of time, its very simple? TA


#3

I use a stop watch to measure time in pieces. If it is to be a
production item where I am really concerned about the actual time
for pricing future pieces then I will do a mini run of three to six
pieces and divide the time between them to get a more accurate idea
of timing for multiples since there is more efficiency in doing all
the same stages of mutiple pieces at once.

Another option if you are making one-of-a-kinds that are roughly
similar in time requirements, then just take the number you make in
a day and divide the number into the daily wage you want. That will
make sure that the break time isn’t “lost” in your pricing.
Otherwise, if you are using exact times in each piece then you will
need to increase your labor rate to make sure that at the end of the
day you are still getting the wage you need for the day even with
the breaks.

Paul Ewing


#4

monica,

it doesn’t always work for me, but i try and write down the time
when i started and the time when i stand up from the bench. this i
usually only do for larger custom pieces that i’m not sure how long
they’ll take.

i also try to work in blocks of 4-6 hours, taking a 15 mintue break
every hour. that way i know how much i worked, without actually
watching the clock.

jocelyn


#5

Hi Monica, There are many types of timers out there. Most can be
used as a count up or count down timer.

The count up timer keeps track of the time from when you start it.
It can be started and stopped without deleting the memory of time
since start up. If you want to keep track of specific time spent on
a project this is the type of timer you need. Each time you leave
the project you can stop the timer and restart it when you start on
the project again. A count down timer allows you to set a specific
time into it. When started it counts down from that time to zero
and usually sounds an alarm at time zero.

Timers can be purchased at Radio Shack, Target, Wal-Mart, ETC.

Timers can be a very helpful tool if you are a time junkie. Lee
Epperson


#6

I keep a black plastic cheap digital stopwatch glued to a shelf , at
eye level over my bench. I only use it when I am doing a job that is
out of the ordinary. I do tons and tons of repairs,sizings,
batteries, remounts,etc… daily for nearly 20 years now, in a
retail situation. 99.9% of what I do each day is a repeat of the
previous 365 days, and over the years, I have worked out about how
many minutes I will spend at any one particular type of work, and
then price whatever comes at me based on $/minute. There are some
profitable jobs that I turn down because I already have loads of
other jobs coming at me that are even more profitable But when I
have an out of the ordinary that looks like it has potential for
profitability, I time myself to make sure I can make a profit on it.
Maybe not on that job , but definitly on the next one. If the market
will not bear what I need to make for that type job, I dont take
that type of job on anymore. And I politely refer the customer to one
of my competitors so that they get the ‘unprofitable’ situation, and
not me. That way, if I even so much as breath, I know that I am
getting what is necessary to pay the lights, taxes, me, and my
wife(who does a wonderful job of counting the ‘beans’ that I
produce). I have a minimum $ amount/hr that I have calculated to
guarantee that I stay profitable. Also by not taking on the jobs that
would have to be higher than the market will bear, to be profitable,
I avoid developing a reputation of being too pricey. At the same
time, I make a very nice living, with minimum hassles. Ed in Kokomo


#7

If you have a computer nearby, you could use this software to track
jobs. I use it for timing graphic design projects. A nice feature is
that you can set your hourly rate and have the program add up all the
times and costs for you.

http://www.timeslice.us

Leslie


#8

I have the same problem…kids are often a source of interuption,
but what about if you solder multiple pieces at the same time? Or do
them individually, but then polish in bulk? Often, when kids
interupt, one doesn’t have time to think about their stopwatch
either.

Jeanne
Jeanne Rhodes Moen
Kristiansand, Norway
http://www.jeanniusdesigns.com


#9

Monica,

What about buying a punch clock on ebay? You could keep a card for
each product and add up the time when your done. You could easily
change from job to job without taking all the time to write down or
keep track of actual time. I like to lump similar jobs so I’ll do
all the metal manipulation at once and then solder all the jobs then
do all the filing and polishing. Though I feel this is the most
efficient way of getting work done, it’s always requires a little
guess work when figuring exact time spent on each job. Someday I
think I’ll try the punch clock, but I’m saving for a graver grinding
machine first.

Larry


#10

Time Slice or a similar program would probably be cheaper and easier
to use in the long run. You can have as many projects going as you
want. Even better, the program adds up the hours at the end.

Leslie


#11

When I constructed my first repair & design price book I bought a
$165 time clock at office depot for each jeweler. Had them click on
the back of envelopes when they began and stopped a job. Yes, they do
2-3 jobs at a time, but I had a good idea of time. Here’ what I
found:

A. They don’t work 25% of the day because of numerous
interruptions. So we increased the time we “thought” it would be by
25%.

B. We added into the cost pr hour another 25% for matching taxes,
vacation, benefits.

If you do manufacturing, try setting aside a day or half day just to
make many pieces of what you are doing. So if you’re making a
bracelet, don’t make just one. Make 6. Start at 9 am and make the
bracelets. Clock out only for lunch. Once done (assuming there’s no
casting-fabrication) and polished, stop the clock. This will include
your interruptions and will give you a fair outlook to time. Then
divide the time by 6 bracelets.

OK, that’s time, not money.

The bigger question is “how many units do you make in 8 hours?” You
might find that you worked from 9 until 3:30 and got no manufacturing
done the rest of the day, just paperwork, answering the phone. That’s
business.

So now we know we can only produce 6 units in a day (simplified).
Your expenses are figured on 8 hours, not 9-3:30.

So if it costs you $500 a day for salary, rent, lights, and supplies
(not the metal for the bracelets, but buffs, rouge, solder) averages
$100 a day, you might find that EXPENSES to run the company $600 a
day, then the 6 bracelets have an overhead cost of $200 each. Add to
that the cost of the metal (let’s say $125 each). Then on the average
each bracelet costs, with your salary and such $325.

This $325 is absolute cost, everything. So this doesn’t get marked
up like you might think because we now know our overhead. But do add
25% for profit.

So $235 marked up 25% makes it sell for $406.00

This is a simplified overview but is how you should look at
manufacturing. Because of competition you should do everything you
can to lower the cost of manufacture by doing what you can to make
many items at once. (I’m speaking to those who make things for resale
in a case or gallery).

Hope this helps
David Gellerwww.JewelerProfit.com
PS version 4.0 of the price book is out. See our web site


#12

I like to note how long different parts take me on average. If I’ve
lost track of the time of a piece, I can add up the typical times of
the parts, such as, making the bezel, setting the stone, adding the
findings, final polishing, etc. Makes for slightly more accurate
guesswork.

Karin


#13

Lesie; Where do you find the time Slice program? I tried doing a
google search and found every thing but such a program, is it a plug
in for some accounting program?. I sure could use something like it
to re-do my pricing functions on several ongoing projects.

TimeSlice website: http://www.timeslice.us

Kenneth Ferrell