Pricing Finished Versus Unfinished Cabinetry

      Thoughts on breaking the cost of finishing out of the cost of a cabinet job. March 26, 2010

Question
What percentage less are you charging for paint grade (say poplar) unfinished vs. stained hardwood with conversion varnish top coats (1 seal coat and 2 finish coats)?

Forum Responses
(Business and Management Forum)
From contributor J:
Good grief, too many unanswered questions. What style door? What stain grade species? Face frame nightmares? Moldings? Percentages don't work well either. How about 10 - 15%.



From contributor B:
We don't provide cabinetry unfinished unless we personally know and approve of the person that will finish them. In that case, the cost to the customer is the same as if they'd have ordered a clear finished beech cabinet set.


From contributor R:
Providing you run a profitable operation, a simple way to do it would be to add all of your employees' hours together for 1 month (a year would be better). Divide your total revenue (labor, overhead and profit) for a typical week (a year would be better) by the number of hours. This gives you an average dollar figure per hour of what you should make in revenue per man hour. Multiply that figure by the estimated number of hours to finish the job and you have your number. Warning: this is a quick and dirty way of estimating and should not be a substitute for doing your due diligence.


From contributor A:
You've got a great website and your product looks very good. So, why are you asking a reasonable question in such an amateur way? Essentially you are asking how much it costs to stain/clear coat a project by percentage. The problem with your question is that it costs almost the same to finish a full overlay basic cabinet job as a beaded inset face frame job. Obviously the beaded inset job costs way more, so your percentage number is not valid.


From contributor G:
Here's a pertinent article in the Knowledge Base:
The Up-Charge for Finishing Cabinets


From contributor M:
I think you need to look at this differently. You need to charge for every service you perform and do it accurately. You should be able to add or remove the service (finishing) without losing money. You will lose the profit margin for that service, but it would not affect the rest of the product's profitability. Installation is another example. In my shop I do not care if they install it or I install it. I make the same amount of profit on the cabinets either way. I just don't make the profits on installing them.

As time goes by and you start breaking down your rates and charges, you will find that some parts of your work make more money than others. Finishing and installation are typically low profit or break even for small shops, but we don't realize this if we don't track or try to separate the services and calculate the labor, material, and profits independently. Once you are forced to look at where you make money and where you are losing money, you can start finding solutions like outsourcing installation or finishing to companies that specialize in those areas.

So the answer to your question is: the amount you would charge to spray a set of cabinets that were brought to you and left wherever you usually begin the finishing process. It is likely the box assembly area, where all the cabinets are all ready to start the finishing process. Imagine someone asked you to finish a set of cabinets that were sitting right there. Figure out how much you would charge and that is the cost of finishing those cabinets. If after you do this you say, "I could never charge that much for finishing," or "I would charge a lot more if I calculate it that way," then the real problem is you are finishing for free or at a loss and subsidizing that process with profits on the cabinet production.



From the original questioner:
Thanks for the input. It's just that we don't supply unfinished cabinets very often (nor do we like to do it). We do calculate our costs, but the number seems high for the finishing. Makes it seem like even bothering with unfinished work is a waste of time. Just wondered if anyone was using a rule of thumb.


From contributor B:
It isn't all upfront hard costs for me. I have a warranty to think about, and I just had a related nightmare last winter again. First, the cabinetry sat for several weeks without finish, then they finished it with some sort of water based homemade faux brew. I had terrible trouble with warping doors on that project. This was a large project, and the only place I had any trouble at all was on the cabinetry the customer's "faux painter" finished. The rest of it we finished, and had no trouble at all, even on some very large doors.

By the way, the reason I let this part of the project go unfinished was because I let my guard down, not a good idea. I did, however, charge them the same price that I would have if I'd have clear finished it, which helped a little.



From contributor M:
"We do calculate our costs, but the number seems high for the finishing. Makes it seem like even bothering with unfinished work is a waste of time."

That is exactly what I am talking about. Sometimes we are building cabinets at no profit just so we can finish or install for profit. I have seen some owner's margins on jobs roughly equal their material markup. It is easy to say, "What does it matter, I make profit of the whole job as a whole," but that tricks us into unprofitable business practices. Coming up with the marketable rates for value added processes makes bidding more accurate and eventually, more profitable. There will be fewer of those jobs where after we are done, we wonder how we made so little money. Usually we blame the client... but I wonder sometimes.



From contributor L:
On average...
Clear coat, 20% total cost of unfinished kitchen.
Add a custom color stain, 30% total cost of unfinished kitchen.
Glazing is another 5-7%.


From contributor I:
The best way I have found is to track your time in at least one project and calculate your hours spent broken down in various stages regardless if you made or lost money in that project. You will find that 20 to 30% will be spent on finishing the project. More than likely 30% +. Think about it... Finishing is time consuming not to mention the cost of materials - especially stained finishes where you need at least two coats of sealer (or pre-cat lacquers one step) so you can sand between coats without going through the finish into the wood itself, no fun here. Then 2-4 coats of pre-cat lacquer for final finish. A lot of time handling happens at this stage as well, so you have to take this into account. This applies to paint grade finishes as well, maybe even more so, if, say, the customer wants a white finish so you paint it white but also clear coat over top to avoid wear marks and longevity of finish.

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  • KnowledgeBase: Business: Estimating/Accounting/Profitability

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  • KnowledgeBase: Finishing

  • KnowledgeBase: Finishing: General Wood Finishing


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