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As work gets a little busier/steady I am trying to streamline my estimates and basic repairs costs. I have done considerable research and have searched many websites and asked shops around town what they're prices are but the water always seems to be quite murky when I'm staring at it. I am looking for what some of you charge for basic services and what is included in them.
IE. nut and saddle replacement... How much for each to install and does that include a setup and or what level of setup. How much for a setup? What different levels of setup do you offer and how much are they?
For example: If a new nut installation costs $50 on a guitar that has been previously set up or needs little adjustment is $50 that end price? If the guitar needs a medium setup, a little cleaning, adjust the rod, adjust the action at the bridge ect. And that price is usually say $60 do you charge $50 + $60 =$100. To make things even more specific and complicated if someone wants a new saddle and nut, the guitar is in decent shape and the price for a new saddle is $50. Obviously the saddle and nut need to be adjusted when you install them so do you only charge $50(nut)+$50(saddle)=$100 and the setup is more or less included or do you still charge a set up fee of $60 which makes the total $160.
I read a lot and I think I confuse my self sometimes.

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You are not going to get tomany answers to this question Luke as it depends on so many things.You have to have a set rate for the job and if you find it needs more than you thought you have to be able to add that to the cost as well. Every job is going to be different and not every one works for the same price pur hour.Good luck Bill........

What Bill said and I'll add geography or where one's market is is also a huge factor.  I've had shops in two very different areas where one had massive unemployment, a lower cost of living, and mostly manufacturing jobs.  Our current shop is in an affluent community that is somewhat immune from even shutting down the government... in so much as a major university is the largest employer.  It's very much a matter of disposable income and how much, if any, folks can afford  non-essential purchases such as getting your ax fixed.  I know for pros it's an essential purchase but just the same the regional economy is important to them for the day job and or gigs.

Anyway shop one for me had much lower prices and although we are not the highest with shop two our prices are higher than my shop one.

Many jobs beg package pricing.  For example that bone nut is often part of a set-up or could be.  It does not make sense to charge in your set-up for cutting nut slots and then charge once more for cutting nut slots with a singular price for making a bone nut.  So we package the two, same with a bone saddle and what this means is that something is discounted a bit from your standard pricing what ever that may be.

Neck resets are another job that really should be packaged with a fret dress and in some cases a refret.  Also installing pups be it acoustic or swapping out pups on an electric if a set-up is also part of the gig we discount accordingly since there are opportunities to realize economies in these sorts of jobs.

Overall we try to be advocating for the customers as if we were the customers.  If we can save our clients money we consider it our responsibility and more imporantly our sincere desire to do so.  Treat others as you would wish to be treated!

I know that the following is a concern for others as well since I have had this discussion before.  But pricing is also susposed to be a function of the cost of goods sold.  In many cases, such as my first shop, someone hangs out a shingle and does repair work out of their garage, basement, out-building, etc.  They may not have Luthier insurance, special insurance for Luthiers not home owners....  They also don't pay a premium to lease, build, buy a building specifically for this purpose AND located in a retail area.  They may not keep retail hours either.

Then on the other hand some shops have much more overhead and may have special Lutheir insurance that protects the client's instruments even in transit, pay for premium locations with the convienience of location for thier customers, carry some inventory, and generally participate to a larger degree in a community.  The costs are higher but so too is the opportunity.  If pricing is a function of the cost of goods sold, and it most certainly is, the brick and mortar shop may have higher prices to reflect the higher costs.  They also may have more protections for the client as well although this is never an absolute.

One of the things that we have learned is that in a community where folks live and do well, jobs pay well, unemployment is low, it's beneficial to your clients to have a retail location and hours so that they can access you when not working.  It's not the same working out of one's basement and taking in jobs by appointment only.  And as such higher costs, more convienience, more protections for the clients, location, location, location etc. have a cost.

Regardless of one's business model at the end of the day the expectation remains that we will all do high quality work and never, never, never do any harm.

Hesh has done a very good job of saying just what was on my mind but I could not put it down on paper as he has done. But i am shure you have got the picture by now Luke.

Thanks guys I appreciate the help. Its very strange to try to price your labor of love. I feel like I put my heart and sole into the tinstruments that are brought in and I take a lot of time into trying to do the right thing for each instrument. Sometimes I feel like the effort that I put in is worth a million bucks but I enjoy doing it for free. I dont want to under value clients and be known as the cheap guy. I want to clients to bring in their instruments with the intention of recieving quality work and the price not a concern when they talk to their buddies.

A good approach to take is to figure out your overhead (your salary is part of that overhead) for a fixed period. Then divide that dollar amount by how many billable hours you will work in that same fixed period. This will give you an hourly rate from which to base your prices. 

Like anything worth doing, working out pricing can get complicated. You might find that you can't charge your hourly rate for every type of repair. At that point you need to ask yourself whether 1) you want to invest your various resources into making that type of service profitable 2) simply not offer that service or 3) continue to provide the service but make up for your lost time with income from other goods or services that you provide.

The key to all of this is accurately keeping records of the comings and goings of your various resources.

Over the years, I've kept pretty detailed records of how long it takes me to complete the repairs that I do on a regular basis. This has allowed me to come up with fixed pricing for many repairs that accurately reflect what I need to charge.

My pricing isn't necessarily all inclusive. That is to say, there are often add ons that get discussed during the pre-repair consultation: the les paul in for a refret that needs a sagging bridge replaced, a martin in for a bridge reglue that also needs a new saddle etc... I've structured my pricing this way because I want people to pay for the service they're getting, not paying for my time spent making someone else a new saddle. But I also don't want (nor do consumers want) to be billing every repair out by the hour because that would make pricing unpredictable.
I have fixed pricing for 1) a set-up 2) a partial set-up 3) each individual aspect of a set up.  Those set prices cover almost every set up scenario.  For example, the martin refret that needs a new nut and a quick saddle adjustment gets billed for a refret (fixed price that covers about 4 billable hours), new nut (a fixed price that covers about one billable hour) and saddle adjustment (a fixed price that covers about 15 minutes).

Hi Luke, 

 We have gone to an ala-carte system of billing. We have a charge for just a pure action adjust which is $35 and for a full set up (cleaning etc) which is $65. (this is in Brooklyn NY and our prices are low for the area) A conversation on a nut replacement ($85) would include an inspection of the guitar and communication with the customer about whether or not they are currently satisfied with the playablity.  If they were not or if I felt it would compromise the end result, I would recommend an action adjust or a full set up if the guitar was grubby. It is rare, but I will occasionally make a nut or saddle with action as is. A nut and saddle together at the lowest price would be Nut $85, Pocket saddle $45 Action Adjust $35. 

We bid the extra $35 on just about every job that requires supplementary action futzings, including refrets. But customers also have the opportunity to do a full set up and get the spit shine. My idea is to keep the prices flexible for different pocketbooks and do no "freebies."  

Hi Luke.

I'm with everyone who advises to document your repairs and come up with an hourly rate based upon that info.

One thing you'll notice is: with repetition, some tasks will take less time than they did, say, 6 months ago.I never adjusted job prices down as the 'extra time' you save on some jobs will be gobbled-up by the tricky jobs.

The only other advice I offer is to ALWAYS make parts extra in job pricing. Once a customer criticized me for charging 20% over retail for a part from Stew-Mac (it seems that EVERYONE gets their catalog). I explained that the extra charge covers the time it takes me to place the order and shipping charges.

I also encourage my customers to discuss what they want done in detail and give them the option of procuring their parts themselves. To assist them, I'll give them the exact part # to order etc. I also provide them with web addresses to Stew-Mac, LMII, Gutar Fetish, Allparts & WD. This method benefits us both and the customer feels like an active participant in the repair. It's a 'good vibes' kinda thing.

If I'm required to order parts prior to the job, I require payment in full for the parts. I've been burned to often by ordering parts and then the customer backs out of the job because "something came up and I spent the parts $$$$". Good for the parts bin; bad for cash flow.

I'll also confirm the geographic/economic factor. I serve a rural area. Right now, business is nearly nonexistent. Although the quality of work will never suffer due to a poor local economy, my prices are extremely 'negotiable' nowadays. Like in the current real-estate business; it's a buyers' market :)

Kudos on your super attitude and your desire to do the best quality work possible. That seems to be what differentiates this forum form others. Other forms discuss 'doing things' but here, we're concerned with doing QUALITY work. High quality work combined with FAIR pricing will draw customers to your door AND give you the reputation of being 'THE GUY' to go to when an instrument needs service. It's a win-win :)

Best of luck our friend :)

I'd like to add one more unique business model for your info & consideration.

I live about 75 north of St. Louis, Mo.  The premier repairman in St. Louis is Skip Goez (pronounced: Gaze).

I've been told by a few of his happy customers that, as of a few years ago, Skip charges $150 (price may be higher today) for an electric guitar setup. This includes a fret level/re-crown/polish, nut & bridge adjustments, yadda, yadda...a very thorough & superb setup. The superior quality of his work is legendary and he serves an international clientele.

In the initial $150 setup fee, Skip's unique service plan includes 'free' labor on action adjustments every 6 months for [I believe] 3 years. Although players freak out at the initial fee, once they experience the quality of his work and learn about the 'free' follow-up care, they understand that overall, it's the best deal in town. This allows Skip to maximize his immediate cash flow AND the follow-up setups are one of the things I mentioned that get done more quickly the more you do them, problem child cases not withstanding.

If I served a major metropolitan area, I'd duplicate his pricing model in a heartbeat. :)

Very interesting and my hat's off to Skip too for requiring something that is often the limiting factor of a great set-up, the fret plane, to be addressed as part of the set-up too!  In offering warranty (no additional funds change hands) action adjustments over the next 36 months he's also very much making the client a private client in so much as they are less likely to go elsewhere when their way is pre-paid (once they contract for the initial set-up) with Skip.  It's much like a "set-up maintenence agreement." 

The only downside that I see would be for Skip's accountant (not that I care about accountants.... ;)) and the concept of recognizable revenue.  Whenever a business has an outstanding liability or even a potential liability that has been prepaid it's always an issue from an accounting point of view when one books the revenue or portions of the revenue.  Each individual client has to be on a moving scale where part of the $150 gets recognized at different times in the 36 month cycle.  It's enough to give an accountant a nervous breakdown - yet another reason why I like Skip's approach!

Two more thoughts.  It seems that the more well known someone is the more.... unique their approach to business may be.  Without naming names one superb Luthier who I know is known when he takes in a repair job to tell clients in advance it will take X months to complete and don't call me during this time.  If you do call before X months are over I will stop working on your instrument and add X more months to the time to complete.  And if you call me again you might as well come pick it up, I'm finished working on it regardless of if the work is complete or not....  I'm not advocating this approach mind you just describing how another Luthier addresses their market.  The most interesting thing to me is that his clients both understand and respect this approach and believe that the superb work that he does is worth it.  

Lastly for we mere mortals the idea of approaching customers with demands, requirements, and rules for working with us seems pretty far fetched.  But on the other hand most disputes in business can be traced back to a misunderstanding of expectations on someone's part, either the service provider or the client.  Perhaps this more rigid approach to expectations helps in this respect if one can get past the initial impression that is...

Here are my thoughts on repair pricing:

I believe in having set rates for nearly every job.  Most of my pricing is based on an hourly rate which is based on what my overhead requires + a bit of what the market will bear.  This hourly rate is posted in my shop and is the basis for most of my set prices, which are also posted.  I also have a “blue book” of labor rates posted on my website.

 So, if a guitar is brought to me for a set up and will also need a nut, and I see no other issues, the estimate is the price of a set up, and a nut, + materials. If, when initially evaluating the guitar, I see other things which will prevent a fully-playable guitar from being handed back to the customer,  I make this clear before the work begins.  And if, after launching into the approved work, something additional crops up as being necessary,  I eat it and don’t charge more to the customer since I should have anticipated the issue in the first place.

There are indeed some deep restoration jobs where you simply can’t give a firm estimate, but you have to be clear about this up front and, ideally, give a worst case scenario. This way your customer will know what they are potentially getting themselves into, at the outset.  The last thing I want to do is call a customer and tell them I am going to charge more than my estimate.

If things go great ( ie quickly), or there are overlaps in the procedures,  I will sometimes roll the final cost back a bit, but I think that over time the set price evens out in terms of my time spent on all jobs throughout a week, or month, or year.  So I don’t feel necessarily compelled to reduce an estimated final cost. Some nut and set- up jobs take longer and some shorter but they all cost the customer the same price.

Fixed pricing is better for the shop and the customer, and ultimately, high quality work will make your pricing just a technicality.

Oh, and I always include fret level and crowning, no additional charge, in my standard set-up procedure if there is minor fret wear. In cases where the frets are deeply worn though, I insist on either replacing the frets or if the wear is not too bad, a complete fret dress, or else I will not accept the job.  There is, of course, an additional charge for this work.

I think it is impossible to price per item as every guitar needs treating individually.  Its better to give indicative pricing and then provide an estimate per job.  Set ups are the hardest to price.  It could take 5 minutes or an hour. 

I appreciate everyone's views and thoughts regarding repair pricing but I do have to beg to differ with those who use ala carte pricing as required and to be determined.

Here's the rub for me.  When I am faced with questions such as this one my default is always to attempt, as best as I can, to view the issue from my very valued client's perspective.  This is not to say that my business concerns are not weighed as well but I am certain to consider the client's view first.

So although we have many pros who we do work for most of our clients are non-music-industy-professionals who simply want their instrument repaired.  From thier point of view getting the work done is not more important than food on the table, the mortgage, etc.  As such they are using their disposable income and from their point of view fixing the old ax may not be as important as a daughter's braces, etc.

As such they need to know, in advance, the extent of their potential liability.  In hindsight we all benefit from knowing in advance the extent our our liability including service providers.  With this said a fixed set-up price reconfirmed by an inspection and receipt provided with the estimate clearnly indicated is important to folks who do ultimately have a choice that includes not getting the work done at all....

Being customer centric is a must, like it or not, unless of course one only wishes to address market segments that will tollerate a business model that is foreign to anything else that they have experienced.

We have had thousands of instruments pass through our shop and we always provide written estimates indicating, clearly, time to complete, price, etc.  It's also all about properly setting expectations as well and we all know that properly set expectations go a long way toward avoiding disputes and gaining happy clients.

In our experience with our set-up price some instruments are done in a flash and others may take far longer than we would like and need more.  We are not going to eat say a neck reset but nearly all other times our single price serves us well enough, provides the client with a forcastable price/liability, and everyone is happy.

I'm not saying what I think others should do, that's not my way, but for our very busy shop clear, set pricing works very well for all concerned.

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