Exactly! Paper towels, gloves, oils, sharpening stones, drill bits, files, tape, respirator refills, and so on and so on. The first 7 knives I sold, I never accounted for my shop supplies that I just don't think about. Now I have it all figured out. And yes, add in electricity.Here's a little tip when it comes to figuring costs...... if you only charge the amount that materials cost you to buy....you're going to loose. You have to estimate, and charge what it will cost to REPLACE the materials you use. Especially if you use exotic hardwoods, or things like ivory, coral, etc.
When it comes to those "other then materials" cost, think long and hard.....it's not just utilities, or other consumables, but it's the wear and tear on your machines, and tools that will eventually require repair/replacement too. We don't think much about those sort of things when the grinder and other power tools are "shiny and new", but "repairs" are going to happen, and machines will wear out over time.
Personally, I do that to determine my cost. My sell price has nothing to do with my cost to make the knife. I sell my knife for what I think the market will bear. My cost is my problem, meaning I need to sell the knife for more than it costs to make. After some time, that's not an issue anymore because your prices are determined by what someone is willing to pay and it will be several times your cost.So do you estimate how many knives can be made out of each item and divide it by the cost of the item. Add them all together and tack that on to the price of the knife.
Exactly. That opens up an whole other bag of worms: annualized cost of doing business.Here's another angle to the cost thing. As I write this I'm sitting in the airport, headed to the Blade Show.... Another BIG expense to think about... Plane tickets, a ride to the hotel, hotel cost, table fees, feeding myself..... And this stupid bag fees! So, even before I've sold a knife, I'm already approx $2k in the hole.
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