Knowing how much to charge is a key determinant in running a successful farrier business. It’s important to price your services high enough to make a good salary, but low enough to remain competitive. So first you have to take into account the many overhead costs involved in determining your price to come to a figure that is right for you. Then you have to take into account your competition and location. What are other farriers in your area charging? Go too high and you lose out on potential work. The same goes with underpricing. If you charge too little people might get suspicious and question your qualifications.
It’s important to set your own fee rather than let your clients set them for you. “Establishing our own professional fee for our time should replace the old practice of charging the going rate which allows someone else to set them for us,” writes J. Scott Simpson. “All equine practitioners should charge for the depreciation of their bodies. Most farriers never learn the difference between cash flow and profit. They are the ones who are not here today because they can’t afford to be.”
The beauty of self-employment is the freedom that comes from setting your own rate, choosing your own hours and doing your own thing. It’s easy to get sucked into the trap of wanting to please your clients, but remember, if you’re working against your will you won’t be working at your best. And if you’re not working at your best the horse may suffer as a result, your clients won’t be happy with your work and you will lose your passion for the job. So nobody wins… and to make matters worse, the work takes its toll on the body and the mental stress affects the mind (and body). So you want to work for an amount that you are satisfied with. If you’re satisfied it will show through in your work.
What to account for when pricing your farrier services
- Experience – Are you full-time or part-time? How many years have you been working for? How long you’ve been working (and whether those years spent working were full-time or part-time) impacts your experience level and how much you can charge.
- Certifications and professional farrier organizations - If you’re certified by a reputable organization, you can charge more because the certification acts as a stamp of approval for your skills.
- Education – How much education do you have? Education is not just measured in length of time studied, but quality of education. Did you go to a reputable school? And do you keep up to date by taking continuing education classes?
Factors to balance when determining your pricing and amount worked
- Household expenses – Account for your rent/mortgage, utilities, vehicle and other living expenses to figure out your annual budget. Once you’ve figured out how much you need to live you can figure out how much you need to earn and thus determine how much you need to charge and how much you need to work.
- Savings – Plan out how much you’d like to save and work that into your pricing and time spent working.
- Retirement – An extension on the savings part. Do you have an idea when you’d like to retire and with how much money?
Self-employed farrier expenses
The following costs assume you’re doing all the work and not hiring anyone else. Hiring outside help can be great since it allows you to get more work done, but it also creates more expenses and eats up more of your time spent managing.
- Vehicle - Factor in the cost to purchase/lease, taxes, fees, fuel, insurance, depreciation, maintenance and repairs. Here’s an example of how much a Ford F-150 costs to own from Edmunds’ True Cost to Own Calculator. With a purchase price of $25,445, by year five it will have cost $51,505 with everything included. (Be sure to keep in mind the increasing cost of gas!)
- Insurance – It’s not just car insurance you need to think about. Ray Miller breaks down the insurance expenses as follows: “Health insurance at $3,000 per year; care, custody and control, $12,000, ($100,000 per horse); liability, $25,000 per year, ($300,000 policy); truck, $3,000 per year; comprehensive on equipment, $1500 per year; Workman’s Compensation, $1,200.”
- Education – Figure out how much your education cost, how much you owe and the interest rate to determine how much you’ll have to factor into your salary to pay off the debt. If your education is paid for, consider how much that education cost you and what it’s worth to pay yourself back. Then as far as continuing education goes, account for the cost of workshops, travel expenses and loss of income from taking the time off.
- Business expenses – Add up all your costs for phone, Internet and website hosting, advertising, business cards, trade association fees, subscriptions, supplies, etc.
After all these cost you have to add in your capital expenditures like a forge and tools and on top of all that you have to factor in taxes. Sales tax or goods and services tax (if your region charges it), income tax and whatever other kind of tax big government is going to think up next.
Working as a self-employed farrier is a business. Self-employment of any kind is not to be taken lightly because you have no steady income, but you have steady expenses that need to be paid month after month. So as you can see from all these considerations, you really have to think things through before you go ahead and shoe!
For a real-world example of how all these costs translate into a farrier’s pricing, read How much do you really make>>