Originally Posted by DaveWC

Standard business practice when valuing a business is to put a reasonable wage in under expenses for the labor of the owner. That way you get a true picture of how profitable the company is. In my previous example, if you remove the wage you end up with a cost of the bike of $2,150 plus 33% profit ($709.50) and a total cost of $2,859.50 for the bike. So you've reduced the cost of the bike, making it easier to sell and now you're paying yourself a wage of $500 (the assumption being that this is a reasonable wage to make a bike) and you're earning $209.50 profit. That's unreasonable payback for taking risk IMO. Either you're shortchanging yourself by placing 0 value on your time building the bike or you're earning far too little profit. As I said, you need to separate & place a value on your time & your risk.

But whatever, it's not going to happen. I guarantee you could easily end up with a million bucks with this company... but only if you started with about $5 million.