How to determine piece-rate pricing

To determine piece-rate pricing for the products produced by one employee perform the analysis work for three, six or twelve months. All products manufactured for the period analysis, fold, divide by the number of working days in the calculation period. You will receive the average of products in one day. Divide the result by the number of working hours, you get the number of products per hour.

Next you need to produce cost of products. To do this, calculate the average daily salary of the employee. The calculation make by adding up all earned amounts for the 12 months divide by 12 and by 29.4 average number of working days in the month. You'll have a patch in one day.

The number of products in one day and the salary is two comparable things. For example, if your employee produces in one day 4 parts, then divide the average salary by 4, you will receive the value of one part. But this calculation often leads to the fact that prices per unit of production is not quite true, this is the analysis work of several employees working in one tariff category or having the same qualification.

To determine the average rate per piece fold the amount of manufactured products for three, six or twelve months teams of employees, divide by the number of working days during which the released products. Then calculate the average earnings over the analysis period. Divide the average daily salary by the number of products in one day. You will receive the average piecework rates, which will be more accurate.

This kind of calculation will allow you to make the payment of wages in accordance with the actual work of each employee. If someone is slower, respectively, and it will get smaller.

Translation for piecework stimulates productivity, and number of manufactured products increases significantly, but the mechanisms on which it is made, should run smoothly. The old equipment is impossible to produce record volumes of product.