I know Andy has remarked how the cost of metal has gone up and how he needs to alter his pricings so i thought i would look into ours as it has been a long time since i actually costed metal figures.
Two main differences though, Andy does all of his casting in-house and we do ours through contractors. Roughly they balance themselves out but ours will always come in slightly higher simply because we get charged for the actual labour of the casting on top of the materials whereas Andy uses Craig.
Our caster currently charges us £25 plus Vat per hour ...which with the current VAT rate works out to £30 per hour. The metal is on top of that.
I took 6 bills, 3 from 6 years ago and 3 from recently.
We use two casters for metal, Griffin Moulds and Anthony Epworth. As we hadnt used Griffin 6 years ago i only priced based on Ep's bills. Griffin bills are slightly higher due to how they price their work, but this isnt a complaint as you get what you pay for.
Metal costs (excluding VAT):
August 2004 = £4.05 kg
August 2010 = £13.63 per kg
February 2011= £16.96 per kg
March 2011= £18.85 per kg.
Caster rates (excluding VAT):
August 2004 = £16.00 per hour
March 2011 = £25.00 per hour
Shipping rates (excluding VAT):
August 2004 = £8
March 2011 = £16
You can see how the prices rise but what does it actually mean.? What i have done is taken the total cost for each bill and divided it by the amount of kg of metal we actually get to get an actual cost per metal weight that it costs us to buy in stock.
1:: In August 2004, the price per kg was £4.05 (excluding VAT) but once shipping, labour, vat had been added on and divide by the number of kg's we got an actual price per kg of £15.52
2:: In March 2011, the price per kg is currently £18.85 (exc VAT), but once shipping, labout, vat had been added on and divided by the number of kg's we got an actual price per kg of £41.54
Hasslefree prices have for the part not risen since 2004/2005, even though the actual cost of production just to get the figures in has tripled. Throw on top of this the packaging costs which have doubled, utilities which have tripled, and the fact we have to pay staff wages which involve extra costs such as NI, Paid Annual Leave etc, insurance costs, rent, petrol...and it goes on. The more i went through old bills the more stressed and scared i got.
Gradually as we have added new ranges we have slowly increased prices in line with our extra costs but never in line with actual costs. this means that over the last couple of years with the other issues we have had affecting production our bottom line has dropped considerably to the point where on paper we arent viable. So prices have to go up and some of them may seem steep but if you think they havent moved for 6 years then i hope you can see why they are as they are. Some of the ranges i have been updating over the last few days but the rest i am doing gradually over the next week.
i know in a recession that is the last thing we should be doing and i know a lot of manufacturers who would just do it 'on the sly' and not even notify people what is going on but you all know that i dont work that way.
we have no choice and i hope you all understand.
