3 ms·

Generally salary is about a third of billed rate- the plumber billing $120/hr is making $80K, someone billing $50/hr would be in the $30K range.

quesera 5y ago
> someone billing $50/hr would be in the $30K range. This might make sense for the service industry. It doesn't sound right, but I don't know the math there. But it is not the same for producers. If you can do productive work (i.e. resulting in a product) at a full-time equivalent level, the math is straightforward. Of course like all self-employment you need to "bill" for the administrative work as well. And you need to make sure there is a market for your time/production.
- panzagl 5y ago
  It was the standard in the printing industry for a small shop, things like graphic design time or press setup. A third goes to labor (just the skilled individual, not including CSRs,mgmt,etc), a third goes to overhead (the people not accounted for in the first category,rent,etc), a third is 'profit' (though mostly re-invested if the owner is paying themselves as labor or overhead). An individual producer can say it's all labor, but then they're doing overhead for free (marketing, resupply, maintenance) or skipping it, and any reinvestment comes from personal funds instead of the business (new tools, outsourced services). Of course materials and equipment time was marked up similarly. And this was just a rule of thumb- you'd have to adjust from there depending on market. But if you were charging less than that you were probably going to hurt the business long term.
  - quesera 5y ago
    This sounds like a different scenario to me. A production house billing out their employees time is very different from a handmade crafts producer pricing their work. The first has many more variables to consider, but the process is well-established in many industries. The second is actually very difficult, all the more so because small-scale individual makers often don't think like small business owners!

quesera 5y ago

> someone billing $50/hr would be in the $30K range. This might make sense for the service industry. It doesn't sound right, but I don't know the math there. But it is not the same for producers. If you can do productive work (i.e. resulting in a product) at a full-time equivalent level, the math is straightforward. Of course like all self-employment you need to "bill" for the administrative work as well. And you need to make sure there is a market for your time/production.

panzagl 5y ago
It was the standard in the printing industry for a small shop, things like graphic design time or press setup. A third goes to labor (just the skilled individual, not including CSRs,mgmt,etc), a third goes to overhead (the people not accounted for in the first category,rent,etc), a third is 'profit' (though mostly re-invested if the owner is paying themselves as labor or overhead). An individual producer can say it's all labor, but then they're doing overhead for free (marketing, resupply, maintenance) or skipping it, and any reinvestment comes from personal funds instead of the business (new tools, outsourced services). Of course materials and equipment time was marked up similarly. And this was just a rule of thumb- you'd have to adjust from there depending on market. But if you were charging less than that you were probably going to hurt the business long term.
- quesera 5y ago
  This sounds like a different scenario to me. A production house billing out their employees time is very different from a handmade crafts producer pricing their work. The first has many more variables to consider, but the process is well-established in many industries. The second is actually very difficult, all the more so because small-scale individual makers often don't think like small business owners!