Marine Fabricator May/June 2020 - 43

lowest to the highest, was a $2,000
difference! If the job had been worth
$20,000, you could understand a
10 percent variance. However, this
job was worth $4,500 to $6,500,
depending on which estimate you
chose. So, who was correct? More
importantly, which estimate ensured
profit and which estimate did not?
Necessity is the mother of all
invention. We immediately knew we
had to create a pricing and estimating
system, one that was not only based on
labor and materials but would also tell
us if we were making money or not!
Establish a pricing system
Most people in our trade are handson folks who do not have hundreds of
hours to collect the seemingly endless
amount of data required to establish
their shop rate, which is an amount
per hour charged to the consumer to
cover labor, taxes, fixed expenses, rents
and mortgages, etc. This is known as
overhead. This shop rate may range from
$65 to $485 per hour depending on
your clientele and location. For example,
a canvas shop on a small inland lake in
Tennessee has different overhead than a
shop in Long Beach, California.
Establishing your shop's pricing
system may be easier than you think. A
simple method is to use the shop rate of
successful industry-related businesses
in your area, such as a boat dealer or
auto dealer. These businesses are often
larger and have dozens of number
crunchers on staff who have already
established the labor rate for your area.
Simply visit the service department of
your local boat or auto dealer. There
will be a sign posted near the counter
displaying the company's labor rate per
hour. Since this labor rate reflects the
value of skilled and trained mechanics
and the overhead costs required to offer

the company's services, you may be
able to use this figure as your labor rate.
After all, why should the canvas maker's
rate be any less, assuming you are also
skilled, trained or certified as well?

"If you ask 100
canvas makers how
they estimate jobs,
you'll likely get 90
different answers."

Determine your costs
The second step is to determine
your cost of goods. In addition to the
cost of materials used on the job, we
must add a markup to cover shipping
surcharges, waste and overages, and
fixed materials such as tape, staples, tools, thread, sewing supplies,
and any other costs associated with
fabrication. This is something most
canvas shop owners fail to factor
into their pricing. They fall back into

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Marine Fabricator May/June 2020

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