Frame Pricing Talk

Transcript of talk given to Wessex Branch of FATG by Stephen Hible GCF., 28/06/11.

Why is Frame Pricing so important?

I hope I don’t disappoint too many of you if I reveal the ending of this talk now, - there is no magic formula for pricing, you won’t go away with the problem solved. But, I hope you’ll go away with some ideas and a renewed confidence in setting your pricing strategy.

This coming September will mark my 35^th year in the framing industry, since I got my Fine Art degree I’ve had no other job. But I still get up in the morning and look forward to the day’s work (most of the time!) I’m sure, however long you’ve been a framer, you feel the same too. We aren’t framers because we want to make money. We’re framers because we love the job. That means that perhaps we’re prepared to lower our price for a job because we really want to do it. In turn, that means our margins are dragged down, so we make even less money. So, if we haven’t set our prices at a sufficiently generous level in the first place, we’re going to enter that downward spiral which is very difficult to get out of. I’ve heard of a framer charging £50 to frame a Rugby shirt and still being prepared to reduce the price if the customer was unsure!

The effect of increasing versus decreasing prices is very marked. As the maths shows us the only sensible way to go is to increase prices. General discounting is a complete no-no, we’ll never compete with Ikea or Wilkinson’s and I, for one, wouldn’t want to.

Note the ”number sold” line which increases & decreases with the price changes.

Effect of price increase/decrease
		+10%	+100%	-10%
Sell for	100	110	200	90
Cost of manufacture	80	80	80	80
Profit	20	30	120	10
Number sold	250	225	62	275
Total Profit	5000	6750	7440	2750
% change		+35.00%	+48.80%	-45.00%

“When you put up prices, the clients you lose will be mean, penny-pinching pondlife. Buying on price, they will be disloyal clients from hell, making unreasonable demands yet not valuing your service. You do not need them. I for one say Good riddance!” Source – ABT, April 2011

Increasing prices means that we will have more time to do the job, therefore we can do it better. We can afford to use better materials, spend more time with the customer and enjoy doing the work.

Another effect of increasing prices is that the better materials can produce the profit without being marked up as much. For example - a piece of specialist glass might cost you £10, doubling up will give you another £10, but standard glass might be £3 for the same size – double up and you’ve still only made £3. I know which I’d rather have!

Because you can have more time with the customer you have more time to show the possibilities. I’m not talking “hard-sell” – specialist glass, rag mountboard & stylish mouldings, when presented properly, all sell themselves.

Obviously your prices must be based on the economics of your business – your hourly rate. This is going to be more if you are a high-street business with large overheads, as opposed to someone with a workshop at home. However, a high-street business is going to get a lot more work than someone hidden away, so it is more likely to fill all the available hours with productive work (making frames and talking to customers).

Working out how long it takes to do a job, like cutting a mount or joining a frame, and then applying the hourly rate is also not as easy as it would first seem. Sometimes the job just “flows” other times you have to “fight” the job all the way. So, I always maintain that “broad brush strokes” are required when setting down the individual costs, some you’ll win, a few you’ll lose – make sure it’s that way round.

How do you price your frames? That’s a rhetorical question and I know there are many answers. I’ve even had a framer tell me that he doesn’t give a price right away, but rings the customer in the evening after he’s worked out all the quantities etc.! I’ve also heard of a framer who looked at peoples shoes – the more expensive the shoe the more expensive the frame!

In years gone-by most would have said “A two-way table”. That was fine 20 years ago. Today people have different expectations. Now, customers expect to see computers in businesses. Computers are “trusted” (If the computer has produced the price it must be right. You can’t argue with a computer).

This is good, because working out the cost of framing is a repetitive calculation. You just need the dimensions, type of moulding, glass, mount and sundries – add the individual costs up – add on VAT and there’s your price. It’s the type of work a computer loves, in fact I’d say they are as happy as a pig in .... muck!

But as with all things “the devil is in the detail”. We need to allow for wastage, for the mitres. It would be good to have a warning if we need oversized mountboard or glass, or if a moulding is out of stock. It would be even better if you could just show the things you actually do. For instance you might want to list “V Grooves” under mounts, but not “Deep Bevel”, or “Football Shirts” but not “Medals”.

It’s possible to do all that (and more) but the trick is to make the layout of the program logical, simple, with as few buttons to click as possible. After all you need to spend your time with your customer, not with the computer. You are the reason the customer is there, not your computer. There are many programs out there for framers, but sadly most have been designed by someone who has never made a frame in their life.

Another requirement for a pricing program is - that the way it works out the price should be reasonably easy to understand, so you can set it to the prices you want to charge. That is going to be different if you are in Merthyr Tydfil to if you are working in an affluent home counties town. I believe that it is one of our responsibilities as business people to set the prices we charge, not abdicate that responsibility to a computer program. As a writer of one of those programs I can’t and I shouldn’t tell you what prices you should charge – that’s for you and your business. But I can make sure that those prices are easy and quick to issue, as well as being consistent and that the parameters used to work out the price are accessible and transparent.

Another thing that is just nuts to a computer is to take that price it’s just issued and record it as a job in a database together with customer details and so on. This means that, whilst you may want to work on paper tickets as the job goes through the workshop, – you don’t need the store the paper for if the customer comes back next year and wants the same frame/mount etc. (also much easier on a computer to find, than sorting through a pile of crumbling work tickets). Once the jobs are in the database it’s so easy to produce a list of what you should be doing and in what order. No more jobs that have been put away “safely”, only to be forgotten about until the customer comes back!

So, I hope I’m convincing you that a computerised system is the way to go, and of course I hope you are all going to buy “Wessex Professional” which is the program I have on my computer here. However when you do look at the various systems ask yourself –

1. Does the program look professional? For instance the IPhone just oozes “professional” before you’ve even touched it

2. Is it easy & straightforward to use? Could anyone use it to issue a price

3. Is it understandable how to change the parameters to reflect your prices?

4. Are you going to be paying for features you don’t need? For instance, you probably won’t need access to obscure German supplier pricelists, or the ability to run the program in Swedish!

5. Will the system the program imposes on you fit in with the way you run your business? By that I mean – if you haven’t used a computerised system before you’ll be going from something with a high human input to a system with a high machine input which will impose certain ways of doing things. This is where a program written by someone who has actually made a frame stands out.

6. Is it going to be easy to get support? Even with all the help files (& Wessex Professional comes with a comprehensive set of “How To” videos as well as the usual Help files) you are still likely to have questions and problems to be sorted out as you come to grips with your new “toy”.

7. Lastly, will the system cope with an unforeseen type of job? - Wessex Professional has the ability to enter any moulding that is not in its database as well as any Extra Cost (with or without Vat).

    To finish up talking (before I demonstrate the program to those who are interested) I have to thank a whole bunch of framers who I’ve met and who use Wessex Professional. Their input has shaped the development of the program – for instance the ability to issue prices in whole pounds came from a customer request. They have also helped iron out errors and bugs (there are something like 12,000 lines of program code) as well as making suggestions so the program “flows” more easily.

Thanks for listening.

© S. T. Hible, 2011

Transcript of talk given to Wessex Branch of FATG by Stephen Hible GCF., 28/06/11.

Creating a bulk update file

A number of people have seen that Wessex Professional can perform a bulk update of all the Wessex & Frinton moulding records and have asked me if that can be done for other suppliers too?

Well, to quote Evelyn Waugh "Upto a point, Lord Copper."
First of all think about why you want the whole of a supplier's range in your database. With Wessex mouldings you can order just one length on your weekly delivery, what is the minimum quantity you'll need to order from a different supplier? Can you use the "Guest" option for a moulding you don't stock? (This is where you type "GUEST" into the moulding box and the program will ask you the width and the wholesale cost/metre and work out the price.)
Also, if you've added, say, a thousand records you are going to need to keep them upto date.

If you do decide you need to use a bulk update file here's how to create one.

1. An Excel spreadsheet (it must be .xls, so in Office 2007 onwards choose Save As & Excel 97 - 2003 workbook).
2. The worksheet must be titled "gen" not "Sheet 1", so right-click the title (at the bottom of the sheet) and choose Rename.
3. The worksheet must include the following column titles - "Reference" (this is the supplier's number. "Description" ("1/2" Cushion Black" for example). "Price/mtr" (wholesale price in pounds & pence per metre) and "Width" (in Mm.)
4. The name of the file is saved as the supplier's name in your database & "mouldings" (so you could save the file as "Arqmouldings" or "Arqadiamouldings", depending how you've titled the supplier in your database).

Well, that's the file, what about the data? Most supplier's seem to have a spreadsheet of their mouldings - it's just a question of getting it in the right form. For instance their Width colunm may be in Cm rather than Mm, but it's easy enough to use Excel to make the changes.
Another problem I've come across is a row missing some data. This will cause the update to fail, (if it does simply delete the offending row and try again).

How does this all come together in Wessex Professional? - Choose "Setup" > "Options", then click on the "Database" tab.
Click on "Bulk Update from File" (top right).
In the next screen you will see the Wessex & Frinton logos, below them a box with "other" in it. Replace "other" with the title of your supplier you want to update (eg "Arq" or "Arqadia", the "mouldings" bit will be automatically added).
Select whether you want to add all records or just update the ones already in your database.
If you are not VAT registered tick the "Add VAT to price" option.
Now click "OK". You'll be asked to find the update file, select it and let the program do the rest.

Phew! It's not that bad really, but I would suggest that it's only worth doing the above for mouldings you can easily get hold of.

A year of Wessex Professional

Well, with the new year looming and the showcase of the 2011 SpringFair at the NEC just over the horizon it seems a good time to review how things have gone with Wessex Professional that was released at the SpringFair 2010.
I'm pleased to say that the program has been very well received with comments and suggestions all positive ones. The feedback I get from clients really does help to make the program easier to use and smooths any rough edges. It also sorts out any mistakes or glitches too.

As an example, the version of the program to be shown at the NEC will be 4.1.2. These last changes came from a conversation with a client who uses the "Guest" moulding facility a lot.
For those who haven't come across this feature - if the moulding is not in the database the user can type "Guest" in the moulding box and a form will appear (when "Total Price" is clicked) asking for the width and price/mt. to use. The program can then work out the cost as usual.

Because I don't use this very often I hadn't really thought out the process and had ended up with something that was a bit "clunky".
The client pointed out that the amount of the Guest moulding needed wasn't printed on the workticket and that if you changed something on the main form you had to enter the Guest details all over again each time you clicked "Total Price".
She also revealed that there was a discrepancy between the quantity shown through the main form and that shown on the workticket. Oh, and by the way it would be good if when you started entering the customer details at various points in the program the name shown was at the top of the list (rather than the bottom) so you could see if you had more that one of the same name in the database, (fairly obvious with "Smith" or "Jones" but less so with, say, "Younger").

After getting over the "Why didn't I think of that?" A fortnight later the a new version of the program was made that - Corrected the quantity problem, showed the Guest quantity on the workticket, made it so you didn't have to enter Guest details over and over, put the customer name you were seeking at the top of the list and, while I was about it, I made it so if you were scrolling through the worktickets or mouldings and selected a record after you closed that record you are now returned to where you had scrolled to, rather than the top of the list. Phew!

I really feel that I can go on the stand at the NEC in Feb. and say that Wessex Professional is the best, most straightforward, most user-friendly pricing/database program for framers on the market today.

Vista & Win 7 - revisited

I've already posted about changes needed for post XP operating systems (ie. Vista & Windows 7). There was, however, an elephant in the room - namely UAC (User Access Control) introduced with Vista.
Now UAC has a lot of aspects, but from a programmer's point of view a major one is needing administrator privileges to write to (make changes to) the Program Files folder. Now, a programmer has a nice warm feeling when all the files that their program needs are in one folder (Program Files > Wessex Pictures in my case). It means they are easy to keep track of and in Windows XP there was no problem setting up your program this way (though whether it was the recommended way is another matter).
Most programs, and the Wessex Pricing Programs are no exception, need to record settings a user makes to configure the program for their use. As far as Wessex Premier & Professional are concerned this includes the labels/values file and the database file itself. Both of these files get written to (ie. changed) a large number of times while the program is in use.
So, these files needed to be set up in another location. The "My Documents" folder is really just too easy to change or "fiddle" with. Microsoft have provided a number of folders that could be used and the one I selected was the Common Application Data folder.
Theoretically, all I had to do was change the sub-routine that returned the path to the Wessex Pictures Program Files folder to point to the Common Application Data folder. Too easy you're thinking - and of course it was. The problem is that in the CommonAppData folder there is a Wessex Pictures folder and within that a WPP4 folder and within that a folder for each "build" of the program, with the code that returns the path to the CommonAppData returning the path to that "build" folder. So what's the problem? Well, if the user installs an updated version of the program it will use a new "build" folder, but the database & user files will be in the previous folder. What is needed is to modify the code to return the folder up from the one returned by the straightforward code (ie. site the files outside the build folders, but inside the WPP4 folder. (see screenshot)


In the above screenshot you can see there are 3 build folders, with the data files outside of them, but within the WPP4 folder.

That crucial line of code is -
Dim dirPathParent As DirectoryInfo = Directory.GetParent(Application.CommonAppDataPath)

It's the "Directory.GetParent" bit that does the business. As with all simple things it took a bit of working out, I couldn't find that anyone else had posted about the problem. What started as some quite elaborate code which searched the folders for the specific files, compared their dates and then moved the latest ones to the new folder, turned into just one extra line.

All that was needed now was some tricky "If" statements checking if the data files were in the old location but not the new location, Then copy the files over. This ensured that users updating the program weren't involved in complex file copying in places they didn't know existed on their computer.

Does it work? It was with some trepidation I installed the update at work (after all it's one thing working in the programming environment and quite another using and letting others use the program for real). I double-clicked the icon on the desktop - the program started and I quickly checked through the database & values - it was all there, pheeew!
This will be the version (4.1.0) that will, finally, be on the Wessex Pictures website for download.

Stock control - does it work?

It's that time of year again, and my "favourite" job - stock taking! But it does mean that I've got a chance to check the stock figures produced by the program (WPP3 or WPP4) against the true moulding stock.
Now you've only got to think a moment to realise that trying to keep track of moulding stock with a computer program is fraught to say the least.
On the face of it all the program has to do is work out how much moulding it's going to use for a particular job (plus, perhaps, a percentage waste), and take that off the existing stock figure - simples?!
Well, no, actually.
First of all the database of mouldings has to be updated each time more stock comes in.
Then how do you account for warped or damaged moulding? You could unwrap each length and carefully inspect it, but, unless you wrap it up again, you're asking for the unwrapped moulding to be scraped, scratched or worse.
Lastly, the moulding could be from different batches which are not compatible. Try telling the program that!
Of course it would be possible to write the program to take account of all the problems, but I think that it would make things so complex that no one would bother trying to keep the stock figure correct.
So, the Wessex Programs tries to keep the stock control simple, keeping it is easy to understand. But this does mean that common-sense also has to be used to keep the figures adjusted and up to date. With a little application you'll find that the moulding stock part of the program is more of a help than a hindrance. I'll give two instances

1. When you give a price the program looks at the moulding stock figure. If that figure is less than the low stock threshold (I have mine set at 3 Mt - roughly 1 length) then a warning is flashed up, so you know to check the actual stock before committing to a completion date.
2. If you are ordering from a particular supplier you can look at the "Low Stock" list in the mouldings database. This shown by supplier so you can see other mouldings to order, perhaps making up a carriage paid order rather than a piecemeal series of orders.

And did the annual stock-take come up with figures close to what the program thought should be there?
Well, surprisingly close, and what was even better - after the upto date figures had been entered the total value of the stock was there already worked out saving hours with a pen and calculator.

Will it run on a Mac?

I guess the most common question we get asked about the Wessex Pricing Programs is "Will it run on a Mac?"
The short answer is "No.".
The long answer is "Very probably.".

The problem is that the Mac operating system and the Windows operating system are very different from each other. They won't recognise each other's files or know how to execute them. Things have got a little easier now that Apple has moved to an Intel processor, but there is still a big gulf between the systems (and, for that matter, Linux, a third system, but see the footnote at the end for that.)

Now, before we go any further, I will nail my colours to the mast and say that I've never used a Mac, so all that follows is from a Windows perspective and I apologise now if I've got anything wrong.

It seems that there are three main ways of getting a Windows program to run on a Mac.
The first is "dual boot". This means that both Windows and the Mac operating systems are on the computer, and you have to choose one or the other when the computer starts. (I believe there is a utility on the Mac called "Boot Camp" that assists with this.) There are two obvious problems with this - a) you can't easily switch between systems, b) you have to buy both systems.

The second way is "Virtualisation". This means you can have Windows running within the Mac system and can switch quite easily between the two. However, you still need to have a full copy of Windows, and the "VM" (virtual machine) software is not the easiest thing in the world to use.

Now we come to the third way - software that will translate the Windows code into something the Mac will understand.
This is where a program like "Crossover Mac" comes in (http://www.codeweavers.com/products/cxmac/ ) Although I haven't used it myself, I have looked at the details and it seems to tick the right boxes. There's a free trial to check that it will actually work and it's reasonably priced if you do decide to buy.

At the beginning of this post I mentioned another operating system - Linux. This comes in lots of varieties, the most popular at the moment being "Ubuntu". The reason I mention it is that it's very secure (based on the Unix mainframe system) and it's free (together with most of its software). As long as you are just using standard office type tasks the system is easy to use. There are the same problems getting Windows programs to run as with a Mac, and the same solutions exist. There is a program called "Crossover Linux" and also a free solution "Wine" - I must get tinkering!

Networking

I thought that it would be useful to write a post detailing the steps to prepare Wessex Premier & Professional to work over a network.

I've suggested in the Help files that networking is still very much a "Dark Art" and even with the coming of Windows 7 I haven't changed that view. There are just too many obscure acronyms and settings for most normal people. So, you might find it advantageous for your sanity to have a network expert to actually get the computers "talking" to each other.

When I talk about networking these programs I'm assuming, say, a computer in the shop and another in the workshop, certainly not more than five computers anyway.
>As far the Wessex Professional & Wessex Premier are concerned the concept is as follows – There is a “Master” computer (usually the one which will issue the prices & print off the invoices), this will hold the database file to be used over the network. The Master computer is networked to one or more “Slave” computers, they also have a copy of the program installed. But instead of using their own database the “Use network database” box is ticked, the path to the master computer's database is recorded and that file used instead




All this is achieved by-

1. Install the program on each computer (you will need an enabling code from Wessex for each one.
2. On the master computer navigate to "All Programs" - "Accessories" - "Windows Explorer". Then, on the left hand pane (in Windows Explorer) go to "My Computer" - "C:" - "Program Files" - "Wessex Pictures". Right-click on this folder, then select "Sharing & Security". Tick "Share this folder on the network", also select the permissions you want (ie. whether the slave computers(s) can modify the files). Click "Apply".
3. On each of the slave computers tick the "Use networked database" box (in "Setup" - "Options"). Then click the "... locate network database." label. With the dialog box - on the left hand pane select "My Network Places" and the shared folders will appear. Double-click the Wessex Pictures folder, keep double-clicking until a screen with 6 folders (4 in Wessex Premier) and a file titled "V3" appear. Highlight "V3", then click "Open". The dialog closes and the path to the database is shown (it will be something like "\\main\wessex pictures\Wessex Professional\V3.mdb")
4. Click "Save" on the Options form and close it. The slave computer will now use the master computer's database.

Phew! That's it (The above is using Windows XP, the steps are similar in other versions of Windows).

NB. The labels and values in all the computers should be the same. This is easily achieved by going to "Values" and clicking "Backup" on the master computer, and copying the file (User.xml) to a memory stick. Then, on the slave computer(s) going to "Values" and clicking "Restore" and copying that file onto them.