And shop overhead is what it is so if you’re really an honest and not a semi-charitable business or semi-hobby then overhead must be covered I’ve had two boat shops, one custom furniture and millwork wood shop and in all cases did first class work and was always in demand but was a terrible businessman. Overhead is the elephant in the room, big and unyielding. The cost to build or alter an existing building, the local and state taxes not only property but business etc., utilities like heating be it gas, heating oil, coal, or wood, telephone, internet, antenna or whatever, security cameras if necessary, building exterior maintenance, snow plowing removal, trash and dumpster charges, signs, advertising, landscaping mowing etc and equipment, shop lighting, office equipment and supplies including computers, displays and software, printers, copiers and supplies, machinery set up, move, upkeep, excluding tooling, machinery repairs, upgrades and replacement amortized, shop interior alterations, paint, wood, wiring, elect panels and runs, dust collection system maintenance including filters, bags and disposal costs, and the big nut of insurance both fire, business loss and errors & omissions if needed, etc etc etc. All these costs are averaged out on a yearly basis and broken down by twelve months. This is the calculated against the labor costs and no matter what this is it’s how much you’re spending on your self or your employees to work by the day or hour. None of this is directly related to any specific job. These are indirect costs. The person who has never run a business or has dealt with these indirect costs is always either in doubt or flabbergasted when told what a shop charges. Rick
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