Most framers love what they do. In times past, making money came second to enjoying a career designing and selling custom framing. Today however, it’s too difficult to operate a small business without maximizing your financial potential. Otherwise, you will no longer be able to enjoy your passion. For us in the framing industry, there is nothing more complicated yet vital as our pricing strategy. The way you price every aspect of your operation and the discounting you offer directly dictates how successful your company will be.
I have studied the anonymous results of millions of projects held in LifeSaver Software’s database so that we could learn what sizes are most commonly sold, what materials offer the best profit, what the yield and waste actually costs a typical framer and many other results which influence profits. I now have the ability to provide framers of all volume levels with a profitable pricing strategy designed specifically for their operation. The result is better markups on materials and sizes which bring the most profit and reduced pricing on items which attract the most objections from customers. The average framer sees an 8% increase in cash flow using this program, so they improve their bank accounts by $16,000 if they do $200,000 in custom framing. That’s an impressive increase, just by fine-tuning their pricing!
Pricing a custom product is challenging because it involves calculating the cost of labor for each aspect of production and the cost of materials. The markup you place on time and materials is vital to the profitability of your company. Pre-calculating the impact your markup will have on long-term profits eliminates surprises and gives you assurance that your pricing will produce enough income to pay for materials, all operating expenses, and still provide a positive cashflow.
Proper pricing can be confusing, but it doesn’t have to be. KB Consulting untangles the web of complex pricing. We bring clarity to evaluating pricing and profitability, and provide step-by-step programs to help framers break through barriers that inhibit growth. Frameshop owners discover how their pricing integrates with all aspects of the business, including operations, marketing, sales, customer service and employee management. Individual pricing tables are created for moulding, matboard, glazing, mounting and fitting. For LifeSaver POS customers, we can even set up your pricing matrices remotely online.
KB Consulting’s Profitable Pricing Program is totally customized for your particular operation, because no two businesses have exactly the same cost of operation. We don’t apply a ‘band-aid’ solution; pricing is geared to the markups needed to produce a profit at YOUR company.
Here are the steps of our Profitable Pricing Program:
- Calculate the amount of profit being generated by your current pricing
- Analyze what gross margin your company needs to cover your particular operating expenses
- Reccommend price changes which will improve your profits and show you what the benefit will be to your cashflow
Our Profitable Pricing Program offers you:
- Confidence in your pricing strategy
- Reduced dependence on discounting
- A projected forecast of the program’s impact on your cashflow
- A way to increase sales volume without growing your customer base
“Ken’s Pricing Analysis was overall a great help to my business – in one month my profitability has improved. It has been a painless way to increase prices without customer resistance.”
Middleton Art & Framing
“Working with Ken was great. He answered all my questions quickly and knowledgeably. I am looking forward to seeing the profitability of my business increase in the near future. My sales are up 20% this year, but my COGS is actually down YTD. It is all thanks to you talking me into raising my margins!”
The Frame Shoppe
VIDEO: Profitable Pricing For Framers
Properly pricing a customized product is very difficult because of waste, yield, the numerous materials used and the amount of labor required to produce the finished result. However, a proper pricing strategy is vital to staying in business.
Ken Baur has studied the sales results of over 10 million projects in LifeSaver’s database, allowing him to construct a series of spreadsheets which reveal the gross margin being generated by your current pricing strategy. Then we analyze your company operating expenses to see if your pricing is producing a positive cashflow. Next, new pricing strategies are created to help you improve profits while remaining competitive.
Watch the video to learn more.
“Ken worked with us to get our pricing structure consistent so that Rockwell’s gross margins are where they need to be. Helping us gain control over such an integral part of the business is no easy task given the numerous variables involved. As we look back, we feel that we now have a much greater sense of control on the front end of our business that was lacking in the past.”
Rockwell Art & Framing
Pricing Analysis Case Study
KB Consulting analyzed the operating expenses of Frame Works in Des Moines, IA. A new pricing strategy was created which increased their gross margin to 72% and cashflow by $15,000 per year. Owner Tom Perrine says his experience with KB Consulting helped him build confidence in instituting positive change in his company.
“Do you fear the consequences of raising prices? Will lowering prices attract customers? Let’s take a look at the math to see how increasing or decreasing prices affect profits.”
Read the full article, “Interesting Math For Determining Pricing Increases”
“Ken went beyond expectations…As a result of his pricing and profitability program I now have a far greater understanding of our pricing structure than I’ve had in 25 years of owning my business. I was able to expand beyond the frame, glass and mat pricing we worked on together and improve the other components of our pricing structure.”
Old Main Gallery & Framing
“I can’t thank you enough for the new pricing structure you have implemented for us at Corner Framing. It has made a world of difference. I should have done it long ago. Thank you for your special attention and your encouragement as well. Thank you, Thank you, Thank you!”