We got together as a group and discussed the various different areas that we would need to research into. Due to the timing of this project, in correlation to all of our other module deadlines and final crits etc, we realised that in order to successfully complete this brief we would need to assign jobs. This would allow us to gather all of the information that we needed in the shortest amount of time. I got given money and had to look into the costings to start up and run our business. First, I had to know where we were going to set up our business, as this would obviously influence various different expenditures. As a group, we came to the decision that we would be based at Duke Street Studios, Leeds. We felt this was a very appropriate place to start and being in Leeds we had access to everything we could possibly need.
However, I now needed to find out exactly how much things would cost. Their website had no information about pricing, but did have a contact number and e-mail. I decided that in order to get the most realistic pricing, I would have to speak to someone from Duke Street and find out exactly what everything would cost us. Before I rang, I wrote up a quick script to make sure that I asked everything I needed and didn't miss any costs out.
Here are the things that I wrote in order to cover:
- Leeds College Of Art students (5 of us)
- Looking for a place to work outside of university, and potentially after university.
The things that we need to know the pricing for are as follows:
- Mac's/Computers
- Printers
- Internet/Phone
- Gas/Utility/Water
- Equipment
I then rang and spoke to a woman called Rosanna. She told me that Duke Street is made up of different levels, each having different prices and different benefits. However, only one floor is currently available, which is the open-area floor. This consists of a large working area that is filled with picnic tables and many different creatives. This would cost us £85 a month and this would cover everything that we would need, apart from our own equipment such as Mac's and camera's etc. We would get access to the kitchens and all facilities that they have to offer, but it would mean that we would need to have our own laptops to take in and out every day. She also gave me her e-mail, rosanna@duke-studio.com, and said that if we wanted to arrange a visit or had any more questions to get in touch. This is a good e-mail to have and will allow me to have this as an option in the future.
From this information, I then started putting a pricing list together (monthly):
- Studio - £85
- Printer - £50
- Adobe Software - £250
- Internet/Phone/Gas/Utilities/Water - (part of studio cost)
- Food - £600
- Travel - £450
- Equipment - £100
- Insurance - £30
- Materials - £50
To work out how much money we would need per month for laptops, I first had to work out how much they would cost. To buy a new mac it would cost roughly £1700, and for 5 of us this would come to £8500. They would need updating around every 3 years, so per year that is then £2833 which becomes £236 per month.
We also realised that we don't need to charge for food as this isn't a part of the business fee's. This costing was then removed from the list, and when added together left us with a monthly overhead of £1251 per month.
This works out at £15, 012 per year. With 281 working days, this comes to £53.42 per day and therefore £6.75 per hour. Basically, this means that if all 5 of us were to work on a project constantly for an entire year, charging £6.75 per hour, we would break even. However, we would have lost money due to living costs and so these need to be added onto this figure. As we want to make sure that we aren't underselling ourselves, we decided to add £11 per hour each onto our hourly rate. And so...
£11 x 5 = £55 + £6.75 per hour = £61.75 per hour. This would be the rate that we would charge at the end of a project. This would mean that if all 5 of us worked every day on a project for a year, the business would break even and we would be making £11 an hour. However, if as a business we were working on multiple projects simultaneously, we would obviously be making much more than this.
I also had been given the e-mails to talk about within the presentation as these weren't very important parts of the business model but were something we felt we wanted to quickly mention. We all have our own e-mail which would allow for the client to have a constant dialogue with whoever was working on their project. We did however also have a joint e-mail which would be for general enquires and would be the first point of contact. This is something that we will show and briefly discuss within our presentation.
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