Subject:
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Re: LDraw CD-ROM Update/Funding and dealing with group funds
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Newsgroups:
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lugnet.cad.dev.org.ldraw
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Date:
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Mon, 29 May 2000 15:32:01 GMT
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Viewed:
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1031 times
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In lugnet.cad.dev.org.ldraw, Tim Courtney writes:
> > As for the Jessiman family... 50 at cost? Seems to me you should price the
> > incremental between 1000 and 1050 and charge them that, which is likely to • be
> > a LOT less than 1000/50 of the actual cost, if you see what I am driving • at. I
> > would almost suggest just giving them 50 for free but they may balk at that.
>
> I'm not completely undersrtanding... I know that 50 at cost is what
> they asked me for in an email - could you clarify 1000/1050? I
> *think* I understand what you're getting to but I'm not 100% sure.
> Its 5am.
Ya, right after I pressed fire I realised it was a bit cryptic. Lets try again.
What is "at cost"? (we all agree that it makes sense to press 1000 of them
because that's where the cost per starts to get cheap)
One *could* argue that the cost is just this: take the cost for 1000 and
divide by 50. That's the fully allocated cost because it includes a share of
the "setup" part of the cost.
BUT, since we know that most of the cost of 1000 is the "setup charge" we
could argue, why not give the Jessiman family the benefit of only paying the
incremental cost for 50 more instead of the fully allocated cost. But what is
the price for "50 more". Ask the pressing guys what the cost for 1050 is.
Subtract the cost for 1000 from it, and that's the incremental cost without
any of the setup charge. Or if they won't do 1050, ask what the cost for 2000
is, subtract the cost for 1000, and then divide by 1000/50 to get the
incremental cost.
Makes more sense?
Here's some numeric examples plucked out of thin air that I think match your
pricing in the shape of the price curve.
Suppose the pricing looks like this.
cost for 100 = 1500 USD
cost for 500 = 1800 USD
cost for 1000 = 2000 USD
cost for 2000 = 2200 USD
So we can see that a lot of the cost is "setup charge". In this case if we
were charging fully allocated cost we'd take 2000 USD/1000 (= 2 dollars a copy
at the 1000 copy rate the "fully allocated cost") *50 copies wanted or 100
dollars plus shipping
But I argue, give them a break, let's us cover the setup charge and charge
them only (2200 USD - 2000 USD) / ( 2000 copies - 1000 copies) (= 20 cents a
copy, the incremental cost.) *50 copies wanted, or 10 dollars plus shipping
Or better yet, just give them the copies free and spread the cost among
everyone else. That's my vote.
++Lar
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