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

[nickao]

A company I used to work with in Chicago charges the clients 75.00 an hour and pays their subs 40-50.00 an hour for labor only.

How can one charge 800.00 or even 1000.00(GBP or US) for 4 days work installing a kitchen and make any money? Heck, one helper alone cost me over 400.00+ for 4 days. Then their workers comp Ins and my liability Ins, plus taxes, I would make about 50.00 for myself(after gas, parking, toll, etc).

 

[jmbfestool]

Thats a good company get paid well!

I thought the company I worked for was good to work for.

The company I use to work for they payed on average 12GBP hour

This included a van which you could take home with you, ( I didnt have a van though not old enough!)
28 days holiday pay a year (This has now become compulsory in the UK now use to be 21days)

Some tools supplied ( Mitre saw, First Fix paslode, Second Fix Paslode, SDS Hammer Drills, Circular saw, Jigsaw, now also because I complained using mine all the time they supplied me with a Trimmer and Router and biscuit jointer but it wasnt standard just I used loads of my tools to help the job the Forman got me some new gear for me to look after)   

New blades for any of your own tools and ofcorse company tools.  Drill bits anything what wear out!  except hand saw the only company I ever heard of not supplying hand saws.

I got a few supplied though being blue eyed boy the Forman liked me[wink] I did what I was asked and more plus quick with out moaning and never bothered him.

JMB

 

[woodguy7]

Nicado

I didn't say it was a good living  [wink]  I am in a small town where i possibly don't have the same overheads as you do & i also don't need any helpers to pay.  This is around the going rate here but there is always someone willing to do it for half the money for cash.  Its a bit easier when you don't have to pay tax ect, just some of the things we are up against.  I'm glad you can charge so much more but for the moment, this is what our economy will stand.

All the best, Woodguy.

 

[jmbfestool]

I agree with wood guy.  

I dont need a helper either the price is just for me alone.  If the work tops are very large some clients will help because they want to keep the costs down or I say ill have some one to give me a hand for one day when its ready for doing the worktops.

Your prices are very high around here you wouldn't get the job no way.

JMB

 

[harry_]

I do not have an hourly rate, per se, only a daily rate. Hourly is reserved for "extras" for jobs I am already on.

I sat down and figured out EVERY possible thing I could think of directly relevant to operating my business and came up with a cost. Then I came up with a number for how much I need to "pay myself" for a year. Then I allowed for taxes that I have to pay as a self employed person.

To that I have a multiplier for materials, and another one for "fuel". 

For me, as I drive further away from home, I happen to be driving into a higher cost expectation. Metro _expects_ to pay more than the suburbs, so that works well for me.

when I can find work....

 

[WarnerConstCo.]

It costs me $1000.00 per month just to wake up and go to work, sometimes more.

There are many things figured into that overhead #, tools, truck, trailer, insurance, taxes, cell phones, office supply's, internet, food, and so on.

At $55.00 hour I tend to take my time and maybe stretch an extra hour out.

8 hours times 55 is only 440.00 bucks a day, 2,200 per week.  I have come to learn and understand that MY time is valuable.  I have 2 little girls that I like to spend time with and work can get in the way.

Let's say I bid a roof (easy numbers to work with) that is 30 squares (3000 sq/ft) one layer tear off and reshingle.  I would be right around $9500.00 and offer a great warranty with it.  I would shoot for 4 days maybe 5 to finish that job. There is roughly 4400.00 in materials and around 5,000 left for overhead, labor and profit.  So at 5 days divided by 5000 averages out to 1000/day.  Sounds like a lot but, it is not really.

My average bathroom 45 sq/ft starts at 11K for a gut and re-do.

I am in the business to  make money, not work like a slave for slave wages.

For as many people that don't want to pay what I want, there are those that do without blinking an eye.

I don't bid stuff cheap just to keep busy all the time, I bid things to make money on and be able to enjoy some free time with my family or playing golf or whatever.

 

[peter halle]

One thing that it took into consideration when I started my company nine years ago was that I would not be working 100 percent of the time.  There are many administrative tasks, and for you Wayne, there is the design and rendering time, and also unemployed time.  I would suggest that you look at a percentage of 25 to 35 percent of your time as being not out on the job and earning income.  That needs to be considered and accounted for in my mind.  So if you figure that working all the time you will earn x at x rand an hour, you need to charge 1.25 to 1.35 times as much.

My other advice is that you should be thinking and charging so that you can expand your business,  People in the trades have a shorter physical work span and if you plan so that you will eventually have employees and a business entity to sell when the time is right for you years down the line, you will be better off.  Please do not make the mistake that many others - including me - have made.  Plan for something that will exist even if you can't or don't.  Not trying to be morbid here.

I am going to look for a couple of articles from Fine Homebuilding and also Fine Woodworking from years ago that might have some credence or at least be interesting.

Peter

 

[nickao]

Guys those are not my prices those are the prices that are paid in Chicago for a sub and what I got paid as a sub. I did not dictate the prices and for big jobs that is how it works here. The general says do it for this amount and that's that or you pass on the job. And anything hourly is such and such an amount. Hey punch list and add on's is where all the hourly big money is made.

For 45-65.00 an hour you are expected to have your own insurance and workers comp and prove it plus you get a 1099 at the end of the year too. They expect a truck as well and you pay your own gas and can end up running around sometimes. You must have all the tools, the general will supply nothing, not a single blade.. The general has to make a buck too that is where the price goes up to 75.00. SO 45.00 is not a high price to charge at all. Hey a handy man with no insurance or workers comp working alone i can be a completely different story.

All I can say about using a helper is that I can get done 4 times what I could alone. For me personally a helper is mandatory if I go in the field alone to do actual carpentry and woodworking myself.

Like I said a regular experienced Carpenter Employee(not a sub) may get about 25-28.00 an hour(that cost the employer 40.00+ per hour). For me that is not a high price when the minimum wage with no exp is 8.25 and really 10.00(to get anyone resembling reliable) an hour.

One note: It is expensive to live in or near Chicago. If I could move to Iowa and  get paid the Chicago rates I would be really well off! This is the reason I would drive 90 minutes or more each way to work. I had to work in the city and live in the country to make it . In my town I am sure I couldn't get 20.00 an hour if there is any work at all. If I lived in the city in the places I worked at it could cost 3000.00 a month for a single bedroom apartment! So the pay is relative. I don't pay that for a 6 bedroom home on an acre 75 miles out of the city.  

 

[-woodsman-]

My boss bills all of us out at 55$/hr.  He only makes money of off the green newbies.  It seems to work for him.  I always thought that it was odd that there weren't different billing rates for the different levels of employes but he keeps us all employed.  Does anyone else do that or is that as weird as i think it is?  I am currently using  40$/hr in my estimates for side work.  This is what its worth to me to have no free time.

 

[peter halle]

Advice that was given to me was if you are not charging at least $45 or more per hour with insurances and at least 12 percent markup on your materials, you are making a big mistake.

 

[WarnerConstCo.]

And don't get me started on people doing "side work" that can cut my throat by 25%+ because they don't pay for General Liability Insurance, WC, commercial vehicle insurance, your own tools and so on and so forth.

In my opinion that makes you no better then the jack-leg hacks that have a "business" but, don't pay for all the things that go along with a legitimate business.

 

[peter halle]

And don't get me started on people doing "side work" that can cut my throat by 25%+ because they don't pay for General Liability Insurance, WC, commercial vehicle insurance, your own tools and so on and so forth.

In my opinion that makes you no better then the jack-leg hacks that have a "business" but, don't pay for all the things that go along with a legitimate business.

Darcy,

From everything I have read on the forum, you tend to work alone.  If that is the case, and if you want to reduce your auto insrance, check on an artisan policy from State Farm, Nationwide, etc.

 

[rnt80]

And don't get me started on people doing "side work" that can cut my throat by 25%+ because they don't pay for General Liability Insurance, WC, commercial vehicle insurance, your own tools and so on and so forth.

In my opinion that makes you no better then the jack-leg hacks that have a "business" but, don't pay for all the things that go along with a legitimate business.

So anyone doing "sidework" is a hack?  I'm a teacher full time and do this stuff on the side to keep our family afloat.  I do pay business associated costs but certainly didn't when I got started.  I understand your frustration but I'm not sure I share your sentiments.

 

[-woodsman-]

I think this conversation is getting a little heated.  Not my intentions with anything I have said.  Warner If I have offended you I am sorry.   We all work hard for our money.  I own all of my tools and my boss pays me acordingly,  I also train his new employees.  I plan to start my own business in the next 6-8 months, the only thing that has held me back has been the economy and feeling comfortable with the size of my client base.

 

[WarnerConstCo.]

If you do side work I don't care as long as you are carrying at least general liability insurance.

If you don't have GL, don't install or work on things in someone's house.

It is the first thing I hand a customer or potential customer. (copy of my insurance cert.)

Not having GL and having something go wrong could be devastating.

Trying to be helpful yet, that subject irritates me and keeps rates down for the legitimate guys.

Peter, my insurance for my truck does not bother me, I was just including all the costs of doing business I could think of, there is a lot more too.

 

[-woodsman-]

If you do side work I don't care as long as you are carrying at least general liability insurance.

If you don't have GL, don't install or work on things in someone's house.

It is the first thing I hand a customer or potential customer. (copy of my insurance cert.)

Not having GL and having something go wrong could be devastating.

Trying to be helpful yet, that subject irritates me and keeps rates down for the legitimate guys.

Peter, my insurance for my truck does not bother me, I was just including all the costs of doing business I could think of, there is a lot more too.

You are absolutely right Warner, I also need to get all my tools insured as well.  I have so much invested that if something happened I would be ruined.  These are all things I need to do regardless of when I'm opening my own company.  Side work for me has been how I learned about bidding and dealing with clients.  It also has given me the opportunity to learn skills that I would have otherwise not learned.  Years ago a friend wanted 2 leaded glass windows and my payment was him buying the tools for me.  I have since done more for him and restored some old ones for other clients.  The door I am about to build (as side work) contains a leaded glass window and there is another one in the foyer that needs to be rebuilt.  They where so happy that I could do both for them.  I am perfectly competent to do this and at what I charge (which will make me a tidy sum) I'm still under the glass guys.  Now maybe I'm steeling from them, but my clients use me because they can have a relationship with 1 person who cares about how there home looks.  Just because there is only 2 stained glass guys around doesn't mean they should stick it to the clients.  They ARE better than me no doubt but at there prices my clients would just put in a replacement window in.  I feel side work, for the folks who work in the trade, is how we graduate from being a employee to owning a business.  When I am finally up and running my prices will reflect that.  This thread has shown how much there is to consider.  Personally it is a little overwhelming.  I salute any one who runs a construction company.

I'm sorry to let this run on I just felt the need to explain myself.

Wayne you do this full time, I think you should be charging the same as others around you for comparable work.  That is, if there is anyone doing work as nice as yours there. [big grin]

 

[Notorious T.O.D.]

Hey if you can have 100 guys working for you and make $10-$15 an hour on each one of them you can get by....

Best,
Todd