Coping with the "new normal".

Over the last few months we have seen increasing shortages and, more recently, galloping price increases.

Wessex Professional and The Framers Pricing App can help you to keep abreast of these changes and keep your business afloat and profitable.

Let's deal with price increases first.

It is important to remember that all suppliers in their terms and conditions reserve the right to change prices without notice. Obviously they try not to, but with prices so volatile it makes sense for us to go by the invoices we receive rather than waiting for a new price list to be issued. 

For mouldings this is easily dealt with in Wessex Professional by going through the invoice and Editing the moulding record to give the correct wholesale cost per metre. (If you are not registered for VAT make sure you include VAT in the figure to reflect the price you have paid.) In the App if you use # codes then redo the code for each of the mouldings in the invoice (Settings > Get Moulding Code). If you use a file imported into the App then you will need to open the file on your computer and edit it, save and import again.

For mountboard and glass there are a couple of ways to deal with price changes.

1) The easy way

If (for example) a mountboard increases from £6.00 to £6.60 a sheet (10%), then simply increase the mount cost by 10%.

For instance - I charge a plain (whitecore) mount at 0.32 pence/sq. cm. So I would increase that cost to 0.352 pence/sq. cm.

I would keep the "Start From" charge the same because that really represents the labour cutting the mount (presumably that will need to increase at some point, but it's not directly related to the material cost).

2) Getting back to basics

There are 9,930.8 sq. cm. in a Larson Juhl board. (122 x 81.4) divide that by the cost of the board in pence to get how much the board is costing per cm. (£6.00 per board = 600 pence = 0.06 pence/sq. cm. Actually 0.0604180932049785 pence!)

Multiply that by a markup (between 4 & 7 usually) to get the main cost figure. Nb. markup is quite high because of the amount of wastage in glass and particularly mountboard.

To make the changes - in Wessex Professional go to Settings > Values and choose the Mount or Glass tab. Select the type of glass or mount you want to change from the dropdown list. Put in the new value and "Save", then go on to the next one.

In the Pricing App go to Settings and choose Mount Values or Glass Values. Tap the top panel for a list of Labels and their values. Select one, change the figures and Save Item. 

Both the Pricing App and Wessex Professional work out prices in the same way. 

Now let's look at how to deal with shortages.

 Because the Pricing App doesn't keep a record of stock or jobs you are going to have to rely on good old "memory mark 1"! 

But Wessex Professional can help. If you know a moulding is unavailable you can check whether you have taken jobs for it by going to Tools > Manage Database > Worktickets. Then choose Views, List By Item. Select "Moulding" and enter the moulding code in the pop-up box. You will then see a list of all the jobs to be completed which use that moulding.

Similarly, you can check glass in the same way. The program won't make the shortages go away, but at least you'll have the information on which to base a decision.

(At the moment the Mount option only shows the type of mount, not the colour. So, unfortunately, that won't help when a particular colour is not available, though it's usually possible to get a acceptable alternative from a different manufacturer).  

All that is probably a lot to take in, but for some bedtime reading have a look at Picture Frame Pricing Programs: Frame Pricing Talk (stevetheframe.blogspot.com) for a overall view of pricing.

 

 

  

Keeping upto date

We woke up on Fri 24th June to hear that a huge change had taken place in this country. Whether your view is that "Turkeys have voted for Christmas" or "The bright dawn of a new era" as framers we need to keep upto date with what could be large price swings. (Much of the materials we use are imported and subject to currency fluctuations.) If we don't then our businesses will very quickly become unprofitable and untenable.

Wessex Pricing Program makes it easy to keep up with any price changes.

When you get an invoice for a moulding order check the cost against the database ("Tools">"Manage Database">"Mouldings" and enter your moulding ID in the yellow box. Click "Find" and the record will appear. If the whole cost/metre is different then click "Edit" (the boxes will turn yellow to indicate they can be changed) change the Cost and click "Save".
Some suppliers still price in imperial, so the program has a calculator ("Tools">"Calculator") one of its functions is to work out price-per-Metre from price-per-Foot.

You can also bulk update supplier's mouldings from an Excel file (there are a number of posts on how to do this), but bear in mind that even the supplier list may not be upto date.

Other costs are entered in "Setup">"Values". Including the Moulding markup and the various "base" costs for Moulding, Glass and Mount. Think of these fixed "base" costs as the cutting charge or minimum charge to cut a mount (or glass, or join a frame).
Below the "base" cost is the variable cost - this is the cost per sq. Cm. to the customer . So, if the cost of glass or mountboard rise this is the place to alter your price. Just put in the new figure and click "Save" for each item.

For some thoughts on pricing and pricing strategy have a look at this post.