Paul wonders if the extra money is worth pursuing more higher revenue jobs?

Data:

Paul has some experience with building furniture, so he has started making tables and chairs himself. After customers saw his work, they also requested custom pieces, which he started charging a premium for. In the first year, House Tech completed 30 interior design engagements. Two-thirds of these were engagements where all major pieces were purchased. On average, the revenues totaled $6,000 for these jobs. The remaining third heavily involved Paul’s specialty items, resulting in higher revenue of $9,000.

Paul estimates he spends $200 of material and 4.5 hours on an average per piece. He believes he made 25 pieces last year. By advertising $2,500 a month, the annual numbers could be increased to 40 engagements, half of them including significant specialty items made by him.”

Answer rating: 100% (QA)

Answer Business model IKEAs business concept is to provide well designed functional home furnishings at prices so low that as many people as possible will be able to afford them Traditionally people h... View the full answer