Time is Money
We all have heard the phrase “Time is money.” Many people credit this expression to Benjamin Franklin, one of the founding fathers of the United States. In 1748, he wrote “Remember that time is money” is his essay, “Advice to a Tradesman“. However, the concept that time is money has roots centuries earlier in ancient Greek times. A Greek orator from the late 5th century BC stated the time is the “most costly outlay”. This statement was referenced in the first century CE book, Plutarch Lives.
Regardless of when the concept of “time is money” began, we all know that our time is valuable and we are wise not to waste it. This is especially true in custom manufacturing businesses. Much time is spent making sales calls, marketing, designing, selecting and purchasing materials, learning new skills and techniques, producing and installing products, invoicing and customer service. It’s important to ensure that this time is compensated. Hourly or salaried wages are paid to employees to complete these tasks.
How to calculate labor rates:
There are different strategies for calculating labor rates. Some price the same hourly rate for each custom product, while others figure a flat labor rate for each individual product they offer. Some have a minimum labor cost while others do not. Some may charge a labor cost per hour while others may charge per square feet.
Once you determine labor costs, add them to shopVOX so they will automatically be added to custom quotes. Labor rates are added to POS settings like shown below:
Step 1: Follow this sequence.
Step 2: Click the New Labor Rate button.
Step 3: Add your new labor rate and save.
To learn more about each of the fields in this form, stay tuned to our next article which will break down the fields in this form.
You can add as many labor rates as you want. You can add labor rates for installation, design, embroidery and any other task that is completed at your shop.
Remember your time is money. Your time is worthy of compensation. ShopVOX makes it easy for you to add labor rates to your quotes. You can either display a separate line item for labor rates or combine labor rates with another line item. This will be discussed in a future article.
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*The featured image was a finalist from August 2018 #VOXcontest. It was a design submitted by Sign Dynamics.