The Pricing Settings page is where you can enter your shop labor cost per hour, and other pricing related defaults. It also allows you to set the next desired invoice number.
To manage labor and pricing settings, navigate to Management Module > Global Settings > Pricing Settings > Pricing Settings tab.
(A) Shop Labor Cost per Hour: the actual cost to run your shop, not what you charge your customer per hour. It should include labor and overhead. It should NOT include production machine costs, which are calculated for each individual machine in your Machine Settings.
- For help in calculating these values, click on the Shop Labor Cost & Margin Worksheet. For additional information please refer to the Shop Labor Cost and Margin article.
- Fill in your Total Non-Payroll Expenses. This can be done by category or as a lump sum.
- Click Go To Step 2.
- Enter an employees name.
- Choose an employee type.
- Billable: Any employee performing direct labor.
- Non-Billable: Any employee performing nondirect labor.
- Mixed: Any employee performing both.
- Ente the total average gross pay this employee receives every month.
- If the employee is Billable or Mixed, enter the number of hours each day spent doing billable work.
- Once you've entered all of your employees, click Go To Step 3.
- Enter the days of the week you are open for business and number of days per year you are closed for holidays.
- Enter the average total percentage of Taxes related to Payroll.
- Click Calculate & Go to Summary.
- Review the information and click Save These Results and Close Worksheet.
- The shop Labor Cost per Hour will populate with the information from the worksheet.
(B) Default Minimum Margin: This is the lowest minimum margin you want to maintain on average and is used on parts using Cost-Plus pricing unless this number is changed on a specific part.
- For help calculating this value, click on the Shop Labor Cost & Margin Worksheet.
- Navigate to Step 3 as you should've already completed the other steps in the first section of this article.
- Enter the Minimum Profit Required.
- Click Calculate & Go to Summary.
- Review the information and click Save These Results and Close Worksheet.
- The Default Minimum Margin will populate with the information from the worksheet.
(C) Default Desired Margin: This is the highest margin you want to achieve on a product on average. This will act as the default desired margin for all parts using Cost-Plus pricing unless this number is changed on a specific part.
- For help calculating this value, click on the Shop Labor Cost & Margin Worksheet.
- Navigate to Step 3 as you should've already completed the other steps in the first section of this article.
- Enter the Desired Annual Profit. This number should be realistic but difficult to achieve.
- Click Calculate & Go to Summary.
- Review the information and click Save These Results and Close Worksheet.
- The Default Minimum Margin will populate with the information from the worksheet.
(D) Default Maximum Discount: This is the highest discount percentage you would ever want to give on a product. This will act as the default maximum discount for all parts using Market-Based pricing unless this number is changed on a specific part.
IMPORTANT NOTE: Because this is a discount percentage from the Market-Based (retail) price that you will enter on a part, it is important that you carefully consider all pricing before finalizing a Market-Based part to ensure profitability.
(E) Current Invoice Number: The number of the last created invoice.
(F) Enter Next Desired Invoice Number: Enter the next invoice number you wish to use. This will be the starting number of the next estimate or invoice created in the system.
NOTE: We recommend updating this once you've set up your system, just prior to going live.
(G) Save Settings: When all areas are completed, click Save Settings.