Glass shop: small parts eat 45% of the time

“For four years I was sure my waste was breakage. Five percent or so: a part cracked under the polisher here, a cutter took the wrong measurement there. And when someone worked out for me that the glass in a small part comes to 287.50 ₴ per metre instead of my 184 ₴, I asked them to run it twice” — that is how Dmytro Zahorodnii, owner of a glass shop in Khmelnytskyi, opened the conversation.

Recognise your own shop? The cutting wheel runs, the edge polisher hums, two cutters make their quota. In a month the shop turns out 1 990 parts and 601 380 ₴ of revenue, with 62 245 ₴ of profit inside it — 10.35%. The figure has held for years.

The arithmetic breaks in one place. The shop buys sheet area and sells usable area. Between the two stands the cutting, and the share it takes away is never the same — it depends on which part you are cutting out of the sheet.

Below we take the shop apart into two units — the usable metre and the minute — and get to the reason small parts take 45.0% of the shop's time and give 25.4% of its contribution.

Dmytro's road: from one table to a shop with two cutters

Dmytro started on his own: a cutting table, a hand cutter and a second-hand polisher in the garage. He did his sums on the back of a delivery note — this much came in from the customer, this much went out for the sheet, the difference is mine.

Four years brought two cutters, a felt-topped bench for polishing edges, a manager and an administrator. Parts grew to almost two thousand a month. And that is when the feel for the numbers disappeared: orders multiplied several times over, and profit did not follow them.

“When I cut the glass myself, I remembered every sheet: what came off it and where I tucked the offcut. Now they bring me a monthly summary. It says how much the shop sold, and it does not say how much glass went into the rack with the offcuts.”

Why “breakage, five percent or so” says nothing about money

Waste, to Dmytro, meant defects: glass that smashed, cracked or was cut to the wrong size. There really is little of that in the shop, five percent or so, and a shop can live with that figure.

Only cutting waste is not breakage. It is glass that has been paid for in full and that no part came out of: the strip along the edge of the sheet, the corner remainder, the chunk between two parts laid out side by side. It is whole, it is on the rack, and it is already an expense. In this shop that waste takes away 18.1% of the sheet area, and it does so unevenly: 8% on large parts and 36% on small ones.

Life before the offcut became a line of its own

The bookkeeping the shop lived in all those years will be familiar to any workshop that grew out of a single table.

• Glass was counted in sheets. This much arrived, this much it cost — and the sum lived as one line called “material”.
• The price was set per usable metre and the cost taken per sheet metre. Cutting waste never made it down to the part.
• The offcut had no price. You could see that the rack was full; you could not see how many hryvnias that came to.
• The shop's time was treated as a free extra to the glass. The cutters' wages stood as a separate sum and were tied to nothing at all.
• Small orders were taken “so as not to turn anyone away”. A customer with a kitchen splashback came in for two little shelves, and nobody asked what he had done with the cutting table.
• The price list was built up from the price of glass plus a markup. The smaller the part, the higher the percentage — and that felt like enough.

Not one of the six points is about glass or about cutting: the machine is sound, the edges are clean, complaints are rare. All six sit in the bookkeeping, which nobody looks into from the cutting table.

One sheet at 1 104 ₴ — and three different prices of glass

A cutting sheet is 3.0 × 2.0 m, that is 6 m². Glass 4 mm thick costs 184 ₴ per metre, so a sheet is 1 104 ₴. A shop with two cutters and a machine runs at 480 ₴ an hour, that is 8 ₴ a minute. Parts come in three types: large worktops and shelves, medium cabinet doors, small inserts and trims.

Type of part	Parts a month	m² per part	Cutting waste	Glass per usable m²	Minutes per part	Price, ₴/m²	Revenue per part	Glass per part	Labour per part	Margin per part
Large	240	1.80	8%	200.00 ₴	14	520	936.00 ₴	360.00 ₴	112 ₴	464.00 ₴
Medium	560	0.55	20%	230.00 ₴	7	690	379.50 ₴	126.50 ₴	56 ₴	197.00 ₴
Small	1 190	0.12	36%	287.50 ₴	5	1 150	138.00 ₴	34.50 ₴	40 ₴	63.50 ₴

A large part takes up 1.80 m² of usable area, and 8% of the sheet goes to waste under it. A small one takes 0.12 m², and the waste under it is 36%: into chunks that size a sheet breaks down worse, and the edge strip eats up more.

184 ₴ and 287.50 ₴ are one and the same glass

Here is the most important number in this article. The shop does not have three grades of glass or three suppliers: the glass is one, 4 mm at 184 ₴ per metre of sheet area.

And 200.00 ₴, 230.00 ₴ and 287.50 ₴ are that same price restated per usable metre through the cutting waste. If 8% of the sheet goes into offcuts, 92% stays usable, and every one of those metres carries the 184 ₴ plus its share of what was thrown away. At 20% waste it comes to 230.00 ₴, at 36% to 287.50 ₴. The gap between the two extremes is 87.50 ₴ a metre, and the delivery note does not show it.

The eight in hryvnias and the eight in percent

Two eights turn up in this shop, and they have nothing in common. 8 ₴ is a minute of the shop's work: 480 ₴ an hour divided by sixty. 8% is the cutting waste on large parts.

The first one multiplies by minutes and turns into money for labour: the 14 minutes of a large part come to 112 ₴. The second one converts sheet area into usable area and turns 184 ₴ into two hundred.

The main unit is not the metre but the shop minute

The price list is written in metres, because the customer asks the price per square. The shop, though, works in time: the cutter is set, the sheet is measured, the part is lifted off the table, the edge is polished, the part is labelled. The shop has 220.5 hours in a month, that is 13 230 minutes. That is all there is.

This is where the geometry parts company with the clock. A large part is 1.80 m², a small one 0.12 m² — fifteen times the difference in area. In time, though, the large one takes 14 minutes and the small one 5: time is eaten not by area but by movements, and they are the same for a worktop as for a teapot stand.

“They showed me two rows: worktop, fourteen minutes; trim, five. I said that is exactly how it should be, the trim is smaller. Then it sank in: it is fifteen times smaller, and it takes only three times less time. I was selling metres and spending minutes.”

14 / 7 / 5 minutes and 112 / 56 / 40 hryvnias are the same labour

14, 7 and 5 are the minutes per part of each type. 112, 56 and 40 ₴ are those same minutes at 8 ₴ each. The second series is not an extra cost on top of the first: it is time translated into money, so that labour can stand in a row beside the glass.

Margin per part and margin per minute

Now the subtraction. A large part: 936.00 ₴ of revenue minus 360.00 ₴ of glass minus 112 ₴ of labour — 464.00 ₴ left. The medium one comes to 197.00 ₴, the small one to 63.50 ₴.

In that shape there is nothing to look at: the bigger part brings more. Divide the margin by its minutes and the picture turns over. Large: 464.00 ₴ over 14 minutes — 33.14 ₴ a minute. Medium: 197.00 ₴ over 7 — 28.14 ₴. Small: 63.50 ₴ over 5 — 12.70 ₴.

464.00 against 33.14: two series in the same order

464.00 / 197.00 / 63.50 is the margin on a single part. 33.14 / 28.14 / 12.70 is that same margin divided by minutes. The order is identical: large first, small last.

The gap, however, is nothing alike. In margin per part the large one is more than twice ahead of the medium; in margin per minute it is ahead by five hryvnias. The medium part, which looks half as strong in the first series, earns almost the same hryvnia per minute.

The shop's month: 13 230 minutes and 882.8 usable metres

240 large parts, 560 medium and 1 190 small — 1 990 together. Next to the usable area we put the sheet area: that is what the shop actually buys.

Type of part	Usable m²	Sheet m²	Waste, m²	Minutes	Share of time	Revenue, ₴	Contribution, ₴	Share of contribution
Large	432.0	469.6	37.6	3 360	25.4%	224 640	111 360	37.5%
Medium	308.0	385.0	77.0	3 920	29.6%	212 520	110 320	37.1%
Small	142.8	223.1	80.3	5 950	45.0%	164 220	75 565	25.4%
Total	882.8	1 077.7	194.9	13 230	100%	601 380	297 245	100%

The shop sold 882.8 usable metres and bought 1 077.7 sheet metres. The difference is 194.9 m², the same 18.1% of everything brought into the store. Small parts account for 80.3 m² of it — more than the 37.6 m² of the large ones and the 77.0 m² of the medium ones, even though small parts yield only 142.8 m² of usable area.

“Once a quarter I used to cart half the rack off to the skip and call it tidying up. One hundred and ninety-four metres a month — that is glass I bought and did not sell. Not one metre of it had been smashed.”

Why 179.6 sheets is a normal number

Divide 1 077.7 m² of sheet area by the 6 m² of a cutting sheet and you get 179.6. The fraction is not an error here: a sheet does not run out exactly on the last order of the month. The 220.5 hours are fractional in the same way, and rounding them up is not allowed.

Small parts: 45.0% of the time and 25.4% of the contribution

Here are the shop's two headline figures. 1 190 small parts at 5 minutes each make 5 950 minutes, 45.0% of the time. Their contribution is 75 565 ₴, that is 25.4%. Large parts in the same month: 3 360 minutes, 25.4% of the time, and 111 360 ₴ of contribution — 37.5%.

Look closely at the two 25.4% figures: they are different things. The first is the shop's share of time spent on large parts, the second the share of contribution coming from small ones. The coincidence is accidental, and because of it two opposite things look the same. The medium parts hold steady: 29.6% and 37.1%.

“I went back over my week. Out of five days the cutting table spends a good two days on trims and stands, and they bring in a quarter of what I live on. I took those orders because they are short and ask for little money. What they were asking for was not money but the cutting table.”

Small parts are not loss-makers

After a table like that the easiest move is to declare small parts loss-makers and stop cutting them. That would be a mistake: a small part gives 63.50 ₴ of margin, which is a plus. If the cutting table were standing idle, every one of those parts would be pure earnings.

The trouble lies elsewhere: the table is not idle. Small parts take up minutes that large ones are short of. Their real price is not 34.50 ₴ of glass and 40 ₴ of labour, but the fact that those same 5 minutes could have given 33.14 ₴ instead of 12.70 ₴. The answer is not “refuse them” but “reset the price”.

The month in total: 601 380 ₴ of revenue and 62 245 ₴ of profit

Revenue is 601 380 ₴. Glass is 198 295 ₴: 240 parts at 360.00 ₴, 560 at 126.50 ₴ and 1 190 at 34.50 ₴. The shop's labour is 105 840 ₴, that is 13 230 minutes at 8 ₴. Contribution is 297 245 ₴, and the fixed costs live off it.

• Shop rent — 46 000 ₴, the same whatever the load on the cutting table.
• Wages of the administrator and the manager — 72 000 ₴, salaries regardless of how many parts go out.
• Electricity and heating — 28 000 ₴: glass does not like a cold shop.
• Depreciation of the machine — 31 000 ₴, charged against the month, not against the part.
• Delivery — 34 000 ₴: bringing sheets in and taking parts out to customers.
• Other — 24 000 ₴: tooling, cutting discs, packaging, phone.

Fixed costs come to 235 000 ₴ in all. Profit: 297 245 − 235 000 = 62 245 ₴ a month, 10.35% of revenue. For a glass shop the figure is normal, and for four years it was the ceiling.

Three moves, none of which needs a new machine

Once the minute had a price, three directions became visible, and all three worked out without equipment, without a second shift and without new customers.

Move	What changes in the calculation	₴ a month
Price of small parts 1 150 → 1 450 ₴ per m²	contribution per minute 12.70 → 19.90 ₴	+42 840 ₴
Cut three fifths of the small parts from offcuts left by large ones	their glass costs nothing	+24 633 ₴
Gather small parts into one cutting layout by thickness, waste 36% → 20%	their glass drops to 230.00 ₴ per usable m²	+8 211 ₴

The order in the table runs against intuition: the third row is the first thing that comes to mind, and the first row the last.

Why “optimising the cutting” gives the least

The third move looks the most obvious and the most technical. Gather the month's small parts into one cutting layout by thickness and cut them as a batch — the waste drops from 36% to 20%, and their glass comes down to 230.00 ₴ per usable metre. Small parts stop being dearer than medium ones.

And here is another pair of identical numbers: 230.00 ₴ is the effective price of glass on medium parts and the level the small ones come down to.

Yet this move adds 8 211 ₴ — the least of the three. The glass in a small part is 34.50 ₴ out of 138.00 ₴ of revenue, and even a solid cut moves the smallest ingredient: the minute and the price stay where they were. It is worth showing precisely because it is the most tempting one.

Price of small parts 1 150 → 1 450 ₴ per metre: +42 840 ₴

The strongest move is the most unpleasant one. A small part cost the customer 1 150 ₴ per usable metre — more than twice the 520 ₴ of the large ones. The markup looked enormous as it was.

In minutes it is tiny: 12.70 ₴ of contribution against 33.14 ₴ on large parts. For a small part to stop pushing a large one out of the schedule, the price has to rise to 1 450 ₴ per metre. Contribution per minute then becomes 19.90 ₴, and the shop gains 42 840 ₴ a month — against the 62 245 ₴ the whole shop brings in today.

This is not about lifting the price list across the board: large parts stay at 520 ₴ and medium ones at 690 ₴. The only type that moves is the one that was being sold cheap by the minute.

An offcut from a large part is glass already paid for: +24 633 ₴

The second move touches neither the price list nor the schedule. When a cutter marks out a worktop, a strip is left down one side and a chunk in the corner. A small part of 0.12 m² fits into an offcut like that without any squeezing, and its glass has already been paid for: it was sitting inside that 8% of waste.

Cut three fifths of the small parts from offcuts and the 34.50 ₴ of material vanishes from the cost of 714 parts — that is 24 633 ₴ a month. There is one condition, and it belongs to the bookkeeping: an offcut must have a size, a thickness and a place. While it stays “whatever was left over”, no cutter will go looking for it: taking a whole sheet is quicker than rummaging through the rack.

“For four years I walked past that rack. And that is glass I paid full price for, standing there waiting for somebody to write a size on it. Now every chunk has marker on it: thickness, two dimensions, date. The small stuff gets cut from there first.”

Two moves — and profit 2.08 times over

The first and second moves do not clash: one changes the price of small parts, the other the glass they are cut from. Together: 62 245 + 42 840 + 24 633 = 129 718 ₴, 2.08 times more.

To double profit the ordinary way you need a second table, a second cutter, a second machine and twice the orders. Here you need nothing: the same 1 990 parts, the same 13 230 minutes, the same supplier at 184 ₴. The third move still holds too — it is simply third in line.

What changed once the minute had a price

The bookkeeping took three technical changes in all. Every part got minutes and contribution per minute standing next to its area. Glass began to be counted as two numbers: sheet area and usable area. And offcuts got rows of their own.

• The price list is built from the minute, not from the metre. 33.14 ₴ and 12.70 ₴ are the two numbers that lifted the price of small parts to 1 450 ₴ per metre with no talk about “the market”.
• Cutting waste moved out of the “material” line. 194.9 m² a month, and separately by type: 37.6 / 77.0 / 80.3 m². You can see which part is making it.
• The rack of offcuts became a store, not a heap. 24 633 ₴ a month is glass already bought, and there is no need to pay for it twice.
• Small orders stopped being a free service. A customer after two little shelves sees a price with 5 minutes of the cutting table in it, not just 0.12 m² of glass.

No machine, no second shift and no turning small orders away was needed. What was needed was seeing a minute of the cutting table as a row with a price of its own.

The takeaway for owners. If your production cuts its goods out of material that comes in a standard size, you have two different costs for the same material — and the difference depends not on the supplier but on the size of what you make from it. Work out the price of a unit of usable material for every type of product, then divide the product's margin by the time it took to make. Almost always the smallest item with the highest markup sits in last place by hryvnia per minute — and it is the one that takes the most time. Any cutting works the same way: metal, chipboard, fabric, film, stone.

A few closing pointers

• Restate the price of material per usable metre for every type of part. A sheet at 184 ₴ per metre yields 200.00 ₴, 230.00 ₴ and 287.50 ₴.
• Put the part's time into money. 480 ₴ for an hour of the shop is 8 ₴ a minute; without that number labour never reaches the part.
• Divide the part's margin by its minutes. 464.00 ₴ and 63.50 ₴ decide nothing — 33.14 ₴ and 12.70 ₴ decide everything.
• Work out what share of the time your smallest item takes. 1 190 parts at 5 minutes each are 45.0% of the shop's month against 25.4% of contribution.
• Do not declare small items loss-makers. 63.50 ₴ a part is a plus; the problem is not the sign, it is the minutes.
• Give offcuts a size, a thickness and a place in the books. Three fifths of the small parts out of offcuts are 24 633 ₴ a month.
• Start with the price, not with the cutting. Waste from 36% to 20% gives 8 211 ₴, while the price of small parts at 1 450 ₴ gives 42 840 ₴.

The money does not vanish — you simply do not see it

People think a glass shop is decided by the supplier's price and a clean edge. Without those you cannot start. But earnings are decided by a third thing — how many minutes of the cutting table a part amounts to, and how many usable metres come out of a sheet under it.

A hole like that does not close by itself and will not show up in the bottom line: the line shows 62 245 ₴ of profit, and it shows the truth. Yet the moment a minute has a price, the main thing becomes visible — the 10.35% of profitability belongs neither to the large parts nor to the small ones. It is the average between a part that gives 33.14 ₴ a minute and a part that, at twice the price per metre, gives 12.70 ₴.

How to see this in your own shop

Everything above rests on one row: not the month in square metres, but each type of part on its own — with its area, its cutting waste and its minutes on the table. As long as cost is counted per metre, you see neither that the same sheet price yields 200 and 287.50 ₴ per usable metre, nor that small parts take 45% of the shop's time. When the same data is collected automatically, the contribution per minute becomes visible — which is exactly why owners of small and medium businesses use Finmap: to see the financial picture rather than gather it from fragments.

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Topic foundation: Management Accounting Explained: What It Is and Why Owners Need It