Know What You Really Pay
The price on the shelf isn't your cost. What you really pay, your landed cost, includes:
- The price per unit
- Shipping or delivery, spread over the order
- Your time and fuel, if you pick it up
- Cutting or handling fees from the supplier
- Taxes you can't claim back (ask an accountant which ones you can)
Spread the extras over what you bought. A $40 delivery on 10 sheets adds $4 to every sheet.
Price Material the Way You Buy It
Suppliers sell by weight, length, area, sheet or piece. Keep a price for each material in the unit you buy it, then convert it to what each job uses.
| Material | Often sold by | Convert for the job by |
|---|---|---|
| Steel bar, tube or angle | Length or weight | The length of each cut, plus kerf and the drop |
| Sheet metal, plywood or acrylic | The sheet | Area used, or the whole sheet when the rest is scrap |
| Plate | Weight | Size × thickness × density |
| Filament or resin | Kilogram or litre | Grams or millilitres per part |
| Vinyl, fabric or wire | The roll | Length or area per part |
| Hardware | The piece or the box | Box price ÷ pieces in the box |
Put a date on every price. A price without a date is a guess.
Allow for Waste
Waste is material you pay for but don't sell: offcuts, kerf, the drop at the end of a bar, test pieces, failed prints and mistakes.
| Kind of work | Waste | Why |
|---|---|---|
| Small parts nested on sheets | Higher | Gaps, edges and the skeleton left over |
| Long cuts from full-length bars | Lower | Drops can be used on the next job |
| One-off parts | Higher | Test cuts and setup pieces |
| Repeat parts | Lower | Proven nesting and settings |
| 3D printing | Varies | Supports, purge and the odd failed print |
Measure it. For a few jobs, weigh or count the scrap, or compare what you bought with what you shipped. Set each material's waste allowance from what you actually see.
If a job leaves an offcut you'll never use, charge for the whole piece.
Mark It Up
Buying, storing, moving and cutting material takes time and money. Prices can also rise between your quote and your order. A markup on material covers that.
Pick one approach and use it every time:
- One markup or margin on the whole job, materials included
- A higher markup on small or special-order items, and a lower one on stock you buy in bulk
Whatever you pick, never sell material for less than it costs to replace.
Keep Up With Price Changes
Prices change. Your quotes have to keep up.
- Record every purchase: the price, the pack size, the shipping and the date.
- Watch the change: compare each new price with that supplier's last one.
- Update new quotes: when a price moves, change the price your quotes use.
- Protect sent quotes: a valid-until date, and a line in your terms that prices can be updated after it, let you re-price an old quote.
- Plan long jobs: when material is bought weeks after the quote, buy it as soon as the deposit lands, or say on the quote that material is priced as of a date.
When a customer comes back after the quote has expired:
"Material prices have gone up since your quote expired, so here's an updated one. The labour hasn't changed; only the steel has."
Stock on Hand
Keeping stock saves trips and lets you start sooner, but it ties up cash. Keep the items you use every week, set a point where you reorder, and take material out of stock for each job so your count stays right.
When you quote from stock, use what it would cost to buy again today, not what you paid a year ago.
Talking to Customers About Material
Customers rarely see your material cost, and they don't need to. If a customer asks for the material broken out, keep it simple:
"The quote includes the material, cut to size, with the waste that comes with it. If you'd like a different material, I can price that as an option."
Be careful with customers who want every line priced so they can buy the parts themselves. That's a red flag, covered in How to Negotiate Payment Terms With Customers.
Do It in Customakr
- In Material Prices, set a price for each material the way you buy it: per lb or kg, per linear foot or metre, per square foot or m², per sheet of a size you set, or each. Library materials convert from their weight, length or sheet size. The standard library has more than 3,000 sizes of metal, plastic and wood.
- Give each material a Waste allowance in Materials. Quotes show the material and its waste as separate lines.
- Your margin or markup applies to the whole job, materials included. Set it on each quote with the Pricing Method.
- On Solo and up, add your Suppliers and record each purchase with Price Paid, Pack Size, Shipping for This Order and the date. Customakr shows how much the price moved since that supplier's last one, and Use This Supplier's Price for New Quotes updates the material in one tap.
- Price changes flow to new quotes only. Issued quotes keep their prices. For an across-the-board change, add a Price Adjustment for future quotes.
- On Solo and up, track Stock with a warning when it runs low, and take material from stock on each job. You can also edit all your materials, prices and machines in a spreadsheet and upload it again.
Checklist
- I know my landed cost, delivery included.
- Every material is priced in the unit I buy it, with a date.
- Each material has a waste allowance based on what I measure.
- I charge for whole pieces when the rest is scrap.
- My markup covers handling and price changes.
- I record every purchase and watch for price changes.
- Quotes have a valid-until date and a re-pricing line in the terms.
- Stock is quoted at what it costs to replace.