It used to drive me crazy trying to figure out how to calculate prices per thousand and then convert it into per piece. It was so tedious and after awhile, just plain irritating. So I designed a quick little spreadsheet on Excel that would calculate the answer for me and I must use it at least a dozen times per day, if not more.
Now that I’ve got a nice clientele, they are always asking me to convert pricing for them so I decided to do two things. Put up an interactive calculator on our website so that they can do it themselves AND write an article helping others that find themselves in the same boat.
So let’s give an example and then how to convert it.
You need a truckload of 2x4x8′. You phone around and get quotes on the material. The best quote is $250/M for 20 packages (294 pieces per package). What is that per piece? So how much is it for the whole load EXACTLY?!?
Here’s the formula on how you calculate per piece.
Step 1 – Get the board feet per piece. (See my other article – “Board Feet? How to Calculate”)
Thickness X Width X Length / 144 (Make sure to change the 8 foot to 96 inches (8×12))
2 X 4 X 96 / 144 = 5.33333
Step 2 – Take the price per thousand (or Per M) and divide by 1000.
250 / 1000 = 0.25
Step 3 – Multiply the board feet in step 1 by the answer in step 2.
5.33333 X 0.25 = 1.33333
Your answer is $1.33 per piece (Rounded down of course).
Okay, are you still with me? Good! Now how much is the total truckload? Well, there are two ways to go about this. You can either take the long road or the short cut (which is more accurate). I’ll explain both.
Long Road – This is now taking 20 packages and multiplying by 294 pieces which will give you 5880 pieces. Now take $1.33 and multiply 5880 and you have your answer of $7820.40
Short Cut – In step one simply include the amount of packages and pieces in your calculation.
2 x 4 x 96 x20 x294 / 144 = 31,360 and multiply it by step 2 (0.25). You have your answer of $7840.00
NOW, you will notice that there is almost a $20 difference? That’s because in the first calculation we rounded down all those decimals to just two. That adds up over 5880 boards (by $19.60 to be exact!) So you definitely want to use the shortcut now that you know how.
So one last question. Why do lumber companies quote per thousand? Simply because of volume AND multiple sizes. It’s much easier to give one quote on 2x4x8, 2x4x10, 2x4x12, 2x4x16 at $250/M then having to calculate all the different sizes and them ad them together or quote each size individually (there may be ten different sizes on the truck!). Also, if the truck is heavy and a package has to come off, the lumber company would have to re-quote all over again when it was already painful to do it just the first time!
There you have it. Hopefully this now gives you a clear understanding of how to calculate and convert per thousand to per piece. Oh, one last thing, if you’re really stuck and still can’t get the calculations, simply visit our website and a free calculator program can be found there!