What is the best way to determine the price of a model/MOC?

[Saberwing40k]

This topic is a little bit odd, and maybe not that generally applicable, but I am building a model on commission, and they want a price estimate. Trouble is, the model has not been built yet, so I sort of have no way of knowing how much it will cost. I was thinking about just applying the 10 cents per part cost to it, but I am kind of worried that that approach is too simplistic. I have tried looking at comparable MOCs on Rebrickable, and then using the Bricklink price checker, among other things, but my Google-Fu has failed me, which makes me think that this is something that has not been done before.

A similar issue is if one desires to purchase all the parts for a MOC that has instructions, as discussed in the thread about Gerger's GMK 2400 crane. Effectively, is there any good to estimate the price of a MOC, or is it really just a crap shoot?

[Paul Boratko]

Did you ask for some money up front first..? I've had people over the years want me to build things for them after I spent time gatherng up parts and completeing it, I would never hear from them again...

Also, 10 cents a piece for a MOC is way too low IMO... 10 cents a piece doesn't factor in your time spent.. 25 cents to 30 cents per peice is much more realistic for a commisioned model..

Edited June 19, 2015 by Paul Boratko

[Saberwing40k]

Did you ask for some money up front first..? I've had people over the years want me to build things for them after I spent time gatherng up parts and completeing it, I would never hear from them again...

Also, 10 cents a piece for a MOC is way too low IMO... 10 cents a piece doesn't factor in your time spent.. 25 cents to 30 cents per peice is much more realistic for a commisioned model..

Yes, I am asking for designer's fees upfront, and that will include the compensation for my time. I'm just asking about the price of the parts for a model, not including R&D and my time. I'll figure that out later.

[BusterHaus]

If this is to become a viable business, the simple way to look at it is time x hourly rate + materials x markup. You estimate how long it will take you to design, purchase parts and build.

Your hourly rate pays your salary and overhead - electricity in your building room, rent/taxes, telephone etc. A simple rule of thumb is two to four times your hourly pay. The factor depends on your overhead. If you're building on a desk in your basement, it may be as low as 1.5 your hourly pay. If you're in an office with a secretary, it increases. It also includes your profit. Do not undervalue your time.

Cost of materials is self explanatory. Don't forget to add shipping costs. Then add to the total your markup (usually around 20 percent). If you use services like chrome application, add them here with your markup.

This is if you want to make a living doing commissioned creations. If you are doing someone a favour, you can ask what the expected to pay and decide if you're willing to do the work according to their answer. It's a good way to build up a portfolio, but you will most likely not make a living with this method.

[Paul Boratko]

If this is to become a viable business, the simple way to look at it is time x hourly rate + materials x markup. You estimate how long it will take you to design, purchase parts and build.

Your hourly rate pays your salary and overhead - electricity in your building room, rent/taxes, telephone etc. A simple rule of thumb is two to four times your hourly pay. The factor depends on your overhead. If you're building on a desk in your basement, it may be as low as 1.5 your hourly pay. If you're in an office with a secretary, it increases. It also includes your profit. Do not undervalue your time.

Cost of materials is self explanatory. Don't forget to add shipping costs. Then add to the total your markup (usually around 20 percent). If you use services like chrome application, add them here with your markup.

This is if you want to make a living doing commissioned creations. If you are doing someone a favour, you can ask what the expected to pay and decide if you're willing to do the work according to their answer. It's a good way to build up a portfolio, but you will most likely not make a living with this method.

I know where you're coming from, but very very few people are going to pay that kind of money for a commissioned piece.. If that were the case, this model would have cost my buyer several $1,000's of dollars.. I think I charged him $800 for everything including the design and shipping..

Yes, I am asking for designer's fees upfront, and that will include the compensation for my time. I'm just asking about the price of the parts for a model, not including R&D and my time. I'll figure that out later.

Ok, I see..

Should work out much better for you that way..

Edited June 19, 2015 by Paul Boratko

[Moz]

For my commissioned stuff I used to just charge minimum wage plus parts because that was a compromise between expectations and reality. That wouldn't work in the US because the minimum is so low, but in most countries it means it's a worthwhile hobby. These days it would also encourage buyers to see whether there are MOC plans they can buy instead...

[BusterHaus]

I know where you're coming from, but very very few people are going to pay that kind of money for a commissioned piece.. If that were the case, this model would have cost my buyer several $1,000's of dollars.. I think I charged him $800 for everything including the design and shipping..

I completely agree that there are very few people who would be interested in paying the full price. Maybe the solution is to have limited runs of a MOC (10 for example) to lower the per-unit cost. This is a recent trend with sculptors and painters, and from what I understand VFracingteam does the same thing with his model ships.

[mahjqa]

And how much do you think it'd cost to invest for 10 models? And you'd have to be absolutely sure you'd sell all 10.

Selling models is very hard to get profitable. It gets even worse when you haven't even built it yet.

Just one suggestion; if your buyer isn't willing to pay the price you've calculated; just walk away.

[BusterHaus]

I'm not talking about creating and packaging 10 copies of a MOC in hopes that they will some day be sold. That's putting the cart in front of the horse, and there are very few builders who have enough recognition to pull of such a feat.

You need a purchase order before starting the work. To get one, you'll need to show the customer a proposal, which involves a bit of design or drawings. That's about as far as you should go.

From what I can tell, there are two ways of making money with MOCs. One is by using LEGO as a medium for creating sculptures, mosaics, or unique replicas of buildings/landmarks. The second is what VFracingteam does, which is to approach the manufacturer and try to sell them a model of their product. It could be ships, sports cars, construction equipment, etc. They order a replica from you, but in multiple units, so you're basically making a very exclusive set. The manufacturer then includes a copy of the set with every piece of equipment sold - it's a very neat way of standing out from your competition.

If you're interested in some numbers, here is a quick back-of-the-envelope example based on 10 copies of a MOC versus 1 copy of a MOC, for a builder who doesn't have much overhead:

Scenario 1 - 1 MOC sold

Hours to design/build: 100

Hourly rate: $40

Material: $500

Selling price: $4,500

Scenario 2 - 10 MOCs sold

Hours to design/build/pack first model: 100

Hours to build each additional model: 10

Hourly rate: $40

Material: $450 (savings on shipping/bulk buying)

Total selling price: (100 x $40) + (10 x $40) + (10 x $450) = $8,900

Unit price: $890

While both unit prices are very high compared to regular LEGO sets, you need to consider that when an expensive product like a ship is sold, an additional $890 doesn't affect the price very much.

Edit: Maybe Edwin can chime in case I'm very mistaken.

Edited June 19, 2015 by BusterHaus

[Edwin Korstanje]

I completely agree that there are very few people who would be interested in paying the full price. Maybe the solution is to have limited runs of a MOC (10 for example) to lower the per-unit cost. This is a recent trend with sculptors and painters, and from what I understand VFracingteam does the same thing with his model ships.

I can almost live from mine commissioned work, but every project is different and also the average brick price per piece.

You already said that you get paid for the design and ours and now you most give them a average brick price and in mine calculation what is fear to you customer is a average price of € 0.11 to € 0.17 excl V.A.T.

I don't know what your project is, but for a one of a kind model is a lot easyer than creating a set.

Good luck with your project.

Edit: BusterHaus beat me first

It's true that the RPA 15 and the SL Gabon i build them for myself, but i take contact to the ship owners for more information and drawings for the build.

They haved never heard of model building with LEGO and get curious and wanted follow every stap i make with the models.

When the models are ready they wanted to seen them in real and the CEO's where in .

Because this is mine hoby and have great fun to build them i only just over dubbeld the price of the parts, that i can expanded mine collection.

Both company's where so pleased that i got for extra so many trips and even to Gabon(Africa) and brings mine hobby to a extreme next level .

All next projects after that the companys coming to me for asking making their ships and also starting creating sets and now it's depends how big their budget is for scale determination.

Edited June 19, 2015 by VFracingteam

[davebarrett]

Pricing is one of more interesting things about running a business. You may or may not consider this a business, but the same thoughts about pricing are probably useful all the same. First of all, look at the net cost of doing this model at all. I'm going to give example values here but you should figure out what works for you.

VALUE TO YOU

The largest cost is likely to be your time. Keep in mind that you could be doing anything else during this time—you're not able to work on your own MOCs, spend time with your family, watch TV, sleep, drink with friends, or anything else. Try to put a dollar/euro value on this. Instead of thinking "how much should I charge per hour?", think "how much should I charge to not do anything else?".

If you find it hard to do this, start throwing out numbers and judge how you feel about them. If someone offered me 0 euro, with no other benefits, to give up an hour of my time to do something for them, I'd tell them to get lost. I'd likely accept for 5000 euro. Find similar numbers yourself, and see how you feel about a mid-point. To continue my example, I'd probably say yes to 2500 too. How about 1250? 500? 20? I've found this sort of thing useful. Let's say this is building (not designing), will take you 5 hours, and you'd be happy with to do so for 20 euro an hour. That's 100 euro.

There's also a cost of materials in terms of parts. Estimating the number of parts needed is likely to be difficult, but a ballpark might help you figure this out. 1500 pieces at roughly 10 cent a piece is 150 euro.

You also need to consider the benefits of it. Maybe this is a test for further commissions, and that opportunity might have a certain value to you. Maybe you really want to build this particular model regardless. This gets harder to judge, but taking the same dollar/euro value approach you might find that it's worth 50 euro to take on this job.

Once you've thought through all the costs and benefits, you add them all together to get your net cost. 100 + 150 - 50 = 200 euro.

This is the minimum price you should ever accept for taking on this job. Otherwise, you are making a net loss in some way. You could be spending time with your friends instead of doing this work. Anything above this price is your profit.

VALUE TO THEM

This is only the floor, though. Your client will have a very similar calculation on their side of things. Perhaps the value, to them, of someone building a model for them is 400 euro. You've saved them a ton of time, and maybe they value their time more than you, or maybe it would take them 4x longer to do. You should aim to price as close to this value as possible. Knowing this value is really, really hard though.

EVERYONE WINS...

If the value of your effort and the materials is worth 200 euro to you, and the value of someone else building the model is 400 euro to them, and you charge them 300 euro, then you've both extracted 100 euro of value from the transaction.

...OR EVERYONE LOSES

Maybe it turns out your net cost is 300 euro, and the value to them is 200 euro. If you charge 250 euro, then both of you lose 50 euro worth of value in the transaction. This is why knowing your net cost is so important. You'll often have very little knowledge on what your client values, but at the very least you can protect yourself from screwing yourself over.

Anyway, I hope that helps.

Just one suggestion; if your buyer isn't willing to pay the price you've calculated; just walk away.

Absolutely agree here.

[Edwin Korstanje]

Dave barrett hit the nail .

For a win/win situation you must listen what the client wanted for a model and figure out how much he wanted to pay ore budget they have.

If the demands are higher than you can deliver than walk away, but first you must tell him that what he wanted is not possible and explane that LEGO have many limits and it is always finding compromise for solutions and mayby change the scale.

By me is it that i make with some projects a very good profit, but with another not that much, but then i get a better promotion for mine name and company and get in the future more commission from them and it's stil a compromise for both

party to make a win/win of it.

[Blakbird]

$0.10 per part is the average for new LEGO from the factory. If you are ordering a specific list of parts in the aftermarket (Bricklink), you are going to pay much more than this, and don't forget about shipping. If you actually know what parts you need, use software like Brickstore to make a parts list and it will give you the average Bricklink price for all of them as of today. Take that number and double it and it will cover your actual costs and shipping. Of course this only works if you know what parts you need and then you still have to consider the value of your time. In general, no one will pay a reasonable rate for your time for a LEGO model. As an example, I spend an average of about 100 hours making instructions for a Technic supercar. If I value my time at even a nominal rate of $25, I would have to sell $2500 of instructions to simply break even, and then more to make a profit. From this point of view I have never made a profit. It is a service to the community. However, a commission is NOT a service to the community, it is a paid job. Don't undervalue that. A paid job should cover all reasonable expenses and time. A large model should be no less than thousands of dollars or Euros. I don't know what VFracingteam is paid for his large ships, but I can imaging it being tens of thousands for parts and labor.

This is not a Technic topic so I am moving it to General where you might get more advice.

[Edwin Korstanje]

You never get rich with building LEGO Models. :laugh:

Just like Blakbird say, that you must put so many ours in it you can never calculait that to your client.

For example with the build from the SL Gabon and asking € 20,00 p/our and brick price it must be cost € 10500,00 and i only got paided € 6500,00 and a little bonus trip to Gabon of € 5000,00 .

In that time it whas for me and Smit Lamnalco a good win/win and after this i got also a commission from them to create a set and i am always thinking in a long term of relations with mine clients.

The price of a model ore set depents also, why mine clients jused me for, only for their commercial sucses ore also for mine models and the good feeling of the Lego brand.

I have just edit mine post and make a big mistake with the calculation.

It's is not € 22000,00 but € 10500,00

Edited June 19, 2015 by VFracingteam

[Deathleech]

It might help to take into consideration your hourly rate at your normal job. That might be a good starting point when figuring out price.

Another big factor would be the material cost. If you are charging just cost to you and no mark up, you should probably be charging more per hour and also calculating the hours it takes you to gather all the materials. If you are marking all the pieces up a few cents you probably can't get away with charging a ton an hour.

[notaromantic]

I completely understand where many of you are coming from, however, the truth of the matter is that there is one all important factor that many of us fail to properly consider beforehand: Who exactly are you?

Meaning that, sure, if you have a portfolio to show, a resume of builds to consider, a clientele and references of your work, then by all means, you may be able to play in the thousand dollars' range - but to able to play, and evolve, with LEGO on someone else's dime < That may more than enough for many of us, and about as much as we can hope for in such a deal - until, at least, we can gather up that portfolio, and fill out that resume, and amass that clientele.

Its always referred to as such a one-way street, when, in reality, there is a lot of benefit in the process to the designer/ implementer themselves that perhaps is not monetary at all.

If it is something that you are going to enjoy doing yourself, then incurring a cost to be able to it isn't such a terrible thing.

Charge whatever you feel comfortable with, regardless of what others charge.

Another option - is to get paid in LEGO. Enough to fund your own build, enough to add to your own collection, perhaps, working with a specific target in mind, (say, just enough to afford that extra copy of a still-sealed Green Grocer, or whatever rare and HTF set/ part you have imagined owning, or maybe just enough to afford double the parts, in order to build a replica of the commissioned build, for your own collection, whatever. Be creative, make the process at least fun for you if it's not going to make you rich...

Edited June 20, 2015 by notaromantic