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Pricing Lineal Mouldings

5/12/15       
PB Member

We are a high-end millwork operation and get requests for reproduction and custom mouldings. Our method for pricing lineal mouldings is at least 15 years old, and doesn't seem to yield consistency or desired margin how we tweak it. All our work is through a 5 head moulder.
Hoping someone similar could share their estimating principles or method that is working for them.

5/12/15       #2: Pricing Lineal Mouldings ...
KJ Member

PB,
Would you be willing to share the way you do pricing now?

5/13/15       #3: Pricing Lineal Mouldings ...
David Waldmann  Member

Website: vermonthardwoods.com

If you haven't changed the process in 15 years you shouldn't need to change the pricing method either. Of course, you do need a way to account for material, labor and overhead cost changes.

However, if you used to do it with a jointer, tablesaw, cabinet planer and shaper, and now you use a gang rip, double surface planer and moulder, or if your pricing method was inaccurate initially you will need to take a harder look at your costs.

Pricing lineal moulding is not really any difference than anything else. You need to know the material usage, labor component, and the costs of each. As alluded to earlier, it's best if you can use variables to account for changing material and labor costs.

You can't accurately use a simple "$X per Y inch of width" for several reasons. For one, there is a relatively fixed amount of waste per piece - a ripping off the edges of the board, the saw kerf, and the amount you take off in the moulder. On a 3/4" wide moulding you could have as much waste as finished product, or 100% additional material, whereas on a 6" wide moulding it may be only 15% additional material.

For another, labor can vary by width. Making narrow mouldings where you get multiple pieces out of one board, the planing process may produce several pieces in the same amount of time it takes to make one piece of a larger moulding. Same for ripping if you use a gang rip. OTOH, some of our products are made by ripping rough and then face jointing, so in that case only the ripping has potential for ganging and the rest is per piece.

You really need to have a good analysis of each step, or process, required to make a particular product, as well as a good handle on how much waste there will be.

We also account for waste factors by species (it varies a lot), and also apply that to any process that occurs before the culling. For instance, we are making culling/cutting decisions after the moulder. So we may have to plane and rip 1200LF of blanks to get 1000LF of good product. But then our profile sander and all finishing steps are only working on the 1000LF of good stuff.

There was a post on here a few weeks ago about a spreadsheet someone had made to quote mouldings (link below). It had a lot of options, including the cost of making knives if necessary, and was fairly user-friendly but didn't have some of the factors that we account for. It would probably work fine for someone simply doing "Product of X" type work.

Pricing spreadsheet

5/13/15       #4: Pricing Lineal Mouldings ...
Zach

Website: http://deasmillwork.com

We use this spreadsheet and have been for many years. It works great once you set it up and configure for your purposes. I have multiple sales people using it with great results.

5/14/15       #5: Pricing Lineal Mouldings ...
PB Member

Thanks for the feedback and access to the spreadsheet! We are noodling with it to determine how we can adapt it to our operation. Regarding the question of how we do it today, we basically charge a material charge, knife charge, and then a standard lineal foot charge without any regard to the difficulty involved or speed of production. It isn't very accurate obviously, but what they have used.

Again, appreciate the input.

5/24/15       #6: Pricing Lineal Mouldings ...
Steve  Member

Website: http://www.commercialforestproducts.com

To test the spreadsheet after you tweak it, I would go back through the moulding runs you've been burned on and plug in the data again - requote them using the formula. See if the new speadsheet would have priced it appropriately.

RFQ's for ugly runs have a way of flying under the radar. These are often shopped really hard and won by the person who missed something significant

Here are some red flags we watch for:

- Really small runs where material cost is dwarfed by the setup. At a minimum, we end up running 3x the footage to avoid the potential of re-setting up if something goes wrong. There's something psychologically
difficult about putting a high per LF price on a small run. It helps to quote these as a flat rate rather than per LF.

- Import species that have a high silica content, destroy knives or tear out the grain. Most people know about teak but there are many others that will ruin steel or not cut well with carbide.

- Odd pattern shapes that may require extra steel or jambs that have multiple kerfs that can't be put in on one pass.

- Profile widths that sound reasonable but produce a high% of waste upon closer examination of your inventory. 4 1/4" net when lumber widths run heavy 7-9" is a good example. Or in the case of a 4 1/4" white maple profile, you may have plenty of 10" boards in stock. If the spreadsheet doesn't take heart/sap into account, it will severely overstate your yield.

- Small size profiles in high volumes. 50,000LF of one profile sounds great on paper but if it runs really slow, it's not as appealing as it sounds.

If you tweak the spreadsheet, re-post it back here. I'm sure you'll get good feedback.

Good luck.

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