What do i need to know in order to work out a hourly rate ?????

[waynelang2001]

Hi guys, this is basically coming off my last post on what you would charge. I work out my income now based on a percentage of the materials, but it seems like everyone else uses a hourly rate. Could anyone give me some idea of what they did to work out there hourly rates???

 

[Guy Ashley]

Wayne

I just posted a reply to this on the other thread, have a look. I dont know if a moderator can shift my reply across to this thread as it is perhaps more relevant.

Guy

"The "hourly rate" has many formulas and variations but for what its worth I will give you the way I price and quote/charge

If you are fitting on site you should charge a minimum of GBP150 per day for your labour alone. There must be an equivalent "subbies rate in SA"?

If you are in the workshop it becomes more complicated. In short you should add up all your outgoings, rent, rates, utilities, insurances, annual vehicle running costs, an amount for depreciation/replacement of tools and consumables, and I am sure there are other members who will say don't forget other things.

You end up with an annual figure, divide that by 260 (52 weeks @ 5 days) then divide that by 8 (Hours) and there is an hourly rate that you need to run your business.

You will the need to add on an amount you ideally want to earn a year and do a similar breakdown taking into account tax, health insurance, shoes for the wife, etc.

Add those together and you have an hourly rate to cover your business and living costs.

Only then can you consider your "profit margin" or Festool purchasing pot".

I don't know how competitive you have to price in SA but you may have to adjust your figure according to the job on the degree of difficulty/skill.

I have sat down with a couple of clients who have choked on a quoted price and set this out and when they realise how little you actually pocket from the job they have seemed embarrassed they even questioned it.

That's the way I do it here and my accountant and wife still say I am too cheap but when you are chasing work it is hard not to keep your prices keen.

Hope this helps

Guy"

P.Halle

 

[waynelang2001]

Wayne

I just posted a reply to this on the other thread, have a look. I dont know if a moderator can shift my reply across to this thread as it is perhaps more relevant.

Guy

I did see it thanks, im not sure if this topic is in the right place though?? The moderators can maybe advise me om where it should be.

 

[jmbfestool]

I just spoke to other work mates who are self employed and said I was planning on going self employed so leaving the company I was working for.

They said  they Normally Charge

150GBP a day  ( I have heard some charge 160GBP a day I never thought they where anything special to charge that amount but they do)

If times are little hard they would charge 130-140GBP

'' Cash in hand  [eek] 120GBP ''

Working hours   8 till 4:30   Having Lunch break 20 mins  and have short tea break  but thats down to individual if you just wanna work work work all day.

I sometimes do if I can get it finished saves coming back or if I feel like it hasn't gone as well as I thought. I know its a day rate so why bother some might say but but I feel the client should be getting value for money.

So answer you question  Based on 150GBP a day works out  18.75GBP a hour

JMB

 

[jmbfestool]

Wayne

I just posted a reply to this on the other thread, have a look. I dont know if a moderator can shift my reply across to this thread as it is perhaps more relevant.

Guy

Just copy and paste?  and then Delete you old message on the other thread?!?

jmb

 

[waynelang2001]

I just spoke to other work mates who are self employed and said I was planning on going self employed so leaving the company I was working for.

They said  they Normally Charge

150GBP a day  ( I have heard some charge 160GBP a day I never thought they where anything special to charge that amount but they do)

If times are little hard they would charge 130-140GBP

'' Cash in hand  [eek] 120GBP ''

Working hours   8 till 4:30   Having Lunch break 20 mins  and have short tea break  but thats down to individual if you just wanna work work work all day.

I sometimes do if I can get it finished saves coming back or if I feel like it hasn't gone as well as I thought. I know its a day rate so why bother some might say but but I feel the client should be getting value for money.

So answer you question  Based on 150GBP a day works out  18.75GBP a hour

JMB

That still seems very high to me but i guess it all depends on the country and living costs, I watched a program here about how for the money you pay for a little flat in the UK you could have a mansion by the see here in South Africa........Honestly......... Id like a mansion  [thumbs up] Ok just worked that out in rand, and it actually doesnt seem to high, if i had to carry the cost of a factory i would just about make a profit.

 

[image132]

Hey Wayne,

Just thought I'd chip in my  [2cents]. I was lucky enough that my first client was a guy who setup his own business and he was extraordinarily helpful with helping me with this exact question. I would love to start my own business "Chris' Carpentry" but I doubt that would happen.

Anyway my point is that I charge about R50 an hour and this is dirt cheap it however affords me roughly R500-700 per job as profit. That includes, wear, petrol and metrial costs. I am happy with that, still living under my parents roof but I doubt that would let me live happily. I'm sure you, being a professional, could easily charge R200-300 per hour. Labour is always the most expensive part of build, in just about any job.

Just my 2 cents. Maybe call around to competitors and ask them how much they charge per hour, get a feel of where the market is at?

 

[waynelang2001]

Hey Wayne,

Just thought I'd chip in my  [2cents]. I was lucky enough that my first client was a guy who setup his own business and he was extraordinarily helpful with helping me with this exact question. I would love to start my own business "Chris' Carpentry" but I doubt that would happen.

Anyway my point is that I charge about R50 an hour and this is dirt cheap it however affords me roughly R500-700 per job as profit. That includes, wear, petrol and metrial costs. I am happy with that, still living under my parents roof but I doubt that would let me live happily. I'm sure you, being a professional, could easily charge R200-300 per hour. Labour is always the most expensive part of build, in just about any job.

Just my 2 cents. Maybe call around to competitors and ask them how much they charge per hour, get a feel of where the market is at?

Thanks Chris, It want even a few weeks ago you asked me this question lol. Now im in the same boat you where. I might just do that and call around to see others hourly rate.

 

[tbellemare]

I have a good carpenter who has done quite a bit of work for me at $40/hr. He's good, works hard, has tools, etc. I've never had a complaint with him at all and I'm pretty critical.

Tom

 

[waynelang2001]

I have a good carpenter who has done quite a bit of work for me at $40/hr. He's good, works hard, has tools, etc. I've never had a complaint with him at all and I'm pretty critical.

Tom

This helps alot Tom, from what I can gather from members in the UK and USA you all seems to have a very close hourly rate, When i work it out it does make alot of sense. I think i might have my hourly rate worked out sooner then I thought.

 

[jmbfestool]

I just spoke to other work mates who are self employed and said I was planning on going self employed so leaving the company I was working for.

They said  they Normally Charge

150GBP a day  ( I have heard some charge 160GBP a day I never thought they where anything special to charge that amount but they do)

If times are little hard they would charge 130-140GBP

'' Cash in hand  [eek] 120GBP ''

Working hours   8 till 4:30   Having Lunch break 20 mins  and have short tea break  but thats down to individual if you just wanna work work work all day.

I sometimes do if I can get it finished saves coming back or if I feel like it hasn't gone as well as I thought. I know its a day rate so why bother some might say but but I feel the client should be getting value for money.

So answer you question  Based on 150GBP a day works out  18.75GBP a hour

JMB

That still seems very high to me but i guess it all depends on the country and living costs, I watched a program here about how for the money you pay for a little flat in the UK you could have a mansion by the see here in South Africa........Honestly......... Id like a mansion  [thumbs up] Ok just worked that out in rand, and it actually doesnt seem to high, if i had to carry the cost of a factory i would just about make a profit.

The prices I gave you are for site work only. So ofcorse things like overheads and replacing expensive machinery parts doesnt come into play on site.

I dont know how much per hour you would charge for workshop.

You could be on more per hour if you was doing price work and worked hard. Could be on maybe 20-25GBP a hour.

Yeah houses do cost alot here in the UK but they have come to a stop at the moment which is GOOD! Well for some people.  

JMB

 

[WarnerConstCo.]

I hardly charge and hourly rate, almost all work is bid work.

Last hourly job I billed at $55.00/hr.  That is at the top of the price range around here for hourly work but, I really shoot for say $75-100/hr on hard cost work.

There are a lot of things I have to pay for out of those numbers though.

 

[jmbfestool]

I hardly charge and hourly rate, almost all work is bid work.

Last hourly job I billed at $55.00/hr.  That is at the top of the price range around here for hourly work but, I really shoot for say $75-100/hr on hard cost work.

There are a lot of things I have to pay for out of those numbers though.

Thats alot  55Dollars is high but  75-100 umm  [blink]

Ill be behind making sure im gettin every second of work out of you

JMB

 

[waynelang2001]

I hardly charge and hourly rate, almost all work is bid work.

Last hourly job I billed at $55.00/hr.  That is at the top of the price range around here for hourly work but, I really shoot for say $75-100/hr on hard cost work.

There are a lot of things I have to pay for out of those numbers though.

Thats alot  55Dollars is high but  75-100 umm  [blink]

JMB

$100 does seems a bit of a stretch to me aswell, if im working it out right around R280 an hour seems to be close to the top of the scale. thats about $40 an hour.

 

[jmbfestool]

$40(25GBP.)  seems a rate I would properly charge for workshop work maybe bit more really. 

JMB

 

[woodguy7]

Wayne

If i am on site or in a customers house then i charge 20GBP per hour.  If in the workshop then its 25GBP per hr (higher skill level for workshop).

If a job is to be priced then i price it at 25GBP per hr.  All the above is plus extras eg, travel, consumables, van costs ect.  I will let you do the conversion to Rands.

Woodguy.

 

[waynelang2001]

Wayne

If i am on site or in a customers house then i charge 20GBP per hour.  If in the workshop then its 25GBP per hr (higher skill level for workshop).

If a job is to be priced then i price it at 25GBP per hr.  All the above is plus extras eg, travel, consumables, van costs ect.  I will let you do the conversion to Rands.

Woodguy.

Yip just as i thought, that works out to just about R280. This is awesome i could have my own festool wall of drool sooner then i thought [dead horse]

 

[woodguy7]

It looks like your work would be worth it & i don't think any of your well heeled clients would flinch if you upped your prices by a considerable amount.  They are probably sitting at home admiring your work & thinking, i cant believe we got it for that much !

To give a small example of price, a standard kitchen install here is 1000 GBP & i would expext it to take 4 days max.  36 hours works out to be just about 28 GBP per hr, for a job that is relatively easy.

Woodguy.

 

[jmbfestool]

Wayne

If i am on site or in a customers house then i charge 20GBP per hour.  If in the workshop then its 25GBP per hr (higher skill level for workshop).

If a job is to be priced then i price it at 25GBP per hr.  All the above is plus extras eg, travel, consumables, van costs ect.  I will let you do the conversion to Rands.

Woodguy.

Yeah forgot to mention that.   Travel and Consumables are Extra with me two.

you say Van cost so you charge for your van?

JMB

 

[jmbfestool]

It looks like your work would be worth it & i don't think any of your well heeled clients would flinch if you upped your prices by a considerable amount.  They are probably sitting at home admiring your work & thinking, i cant believe we got it for that much !

To give a small example of price, a standard kitchen install here is 1000 GBP & i would expext it to take 4 days max.  36 hours works out to be just about 28 GBP per hr, for a job that is relatively easy.

Woodguy.

I charge normaly 600-800 for kitchen takes me 3 to 4 days to fit. Kitchens normally work on ?200 a day.  (25GBP hour) Plus travel, consumables ( Router bit everytime for cutting work tops)

JMB