Learning about Production Cost
Saturday, November 14, 2015
Hello Everyone,
Today I will briefly be going over an assignment dealing with Production Cost. For all of you who might be interested in knowing more about this, continue reading.
For this assignment I learned about production cost which basically covered information on what happens behind the scenes when an item is being produce and after that the calculations and cost that go into knowing what is the best price to sell the product for. We were also required to use a previous handmade jewelry piece to determine how much our item would hypothetically sell for. So below I have picture of my handmade necklace. The items that I used were light brown and black hemp cord to create a loopy style necklace, with an antique diamond design at the center of the necklace that has loose black crystal pendants and pearl, I also bought the clasp to secure it in the end.
And by going over my cost in making this I made the Production Cost Report that determines and estimates of how much this would cost if put on shelves to be sold.
As seen by the report I have two sets of prices, the first one is a bit more expensive, but through a few changes like finding cheaper or less expensive items to make it and the time it takes to make it, I managed to make it become $4.00 cheaper. The reason behind this change has to do with the fact that when you make or produce something you have to also play in the factor that you want to make a profit, yet at the same time make the item a reasonable price in which customers will agree on. So with this lesson, I learned more about how products in store get their price set. And it was interesting to know more about this so when you buy anything in store you are more aware of why the price is set the way it is.
P.S. Have you ever made any handmade jewelry?
-Ruth Sarai-
Keep Going & Keep Growing
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