Page 3 of 4 FirstFirst 1234 LastLast
Results 21 to 30 of 36

Thread: Billable hourly wage

  1. #21
    Join Date
    Jun 2016
    Location
    Tampa, FL, USA
    Posts
    865
    Every county in every state seems to have a different rate. What factors go into what people are willing to pay per hour I can only guess.

    Number of companies
    Number of available technicians
    Weather conditions
    Insurance costs
    How rich the customers are
    How old the housing stock is
    Union market share
    a dozen other things

    Customers look for two things: price and quality. The higher your quality, the more you can charge. Quality costs money so you can't be high quality and be the low price leader. Quality includes a lot of things. Being on time, exact time appointments, neat uniforms, booties, well spoken techs, neat work, cleaning up after yourself, good quality materials, being fast and efficient, accepting credit cards, and lot more.

    Some customers are only concerned with price and never ask about quality. (Hint: Stay away from these.)
    Some customers never ask about the price and call you because you were recommended highly (Hint: You want these.)
    If a customer calls and the first thing they say is "Do you offer free estimates?", they are probably going to be price shoppers.

    Probably the correct solution to the problem is:
    (1) Determine who your competitors are.
    (2) Find out what they are charging.
    (3) Figure out what quality benefits you offer that differentiates you from your competitors.
    (4) Decide where on the spectrum of pricing you want to be: lowest, low, middle, high, highest. (Hint: middle is a good starting spot.)

    Once you have a price and have used it for a while, how do you know if you are charging the right price? By seeing what percentage of estimates (small jobs) you give turn into jobs and how full your calendar is.
    I shoot for a 80% conversion ratio. If you start getting 95% of the things you estimate, your pricing is probably too low. If you are only getting 40%, your pricing is probably too high. If you are booked out three weeks, your pricing may be too low. If you are booked out only two days, your pricing may be too high (or you need to work on getting referrals).

  2. #22
    Join Date
    Aug 2004
    Location
    Northern illinois
    Posts
    15,506
    people make too much of some formula for figuring out how much to charge.

    start by figuring out your actual marginal cost per hour and your overhead.

    figure out how many hours of billable time there are likely to be per year.

    it is simple math to figure out from there what you have to charge to break even if your estimates are good.

    the important thing is to decide what you want to be. if you are happy doing the work that comes in from referrals, and don't care about growth, your costs will be a lot less since you won't have to pay for a salesman, a PM, a fancy office, or a lot of other overhead. This allows you to make a good living with a lower rate if you can make it work.

    Keep in mind that a lot of self employed businessmen make less working for themselves than they probably would if they worked for someone else.
    Bob

  3. #23
    Join Date
    Feb 2007
    Location
    Alexandria, VA
    Posts
    360

    hourly vs flat rate

    I posted earlier about the three answers to the question how much do you charge to install a ceiling fan?

    A. $250
    B. I charge $100 per hour.
    C. I charge $100 per hour and it will probably take 2-3 hours.

    What I was getting at is this. Are there customers out there that will hire someone to install a fan or do other similar work on an hourly bases?

    In my area people want to know what the cost will be for electrical work. Not how much I charge per hour. I could say $20 per hour and they still would want to know what it would cost. Besides, how many fans do I need to install until I learn that it takes about 2 hours start to finish?

  4. #24
    Join Date
    Jun 2016
    Location
    Tampa, FL, USA
    Posts
    865
    Quote Originally Posted by Greg1707 View Post
    I posted earlier about the three answers to the question how much do you charge to install a ceiling fan?

    A. $250
    B. I charge $100 per hour.
    C. I charge $100 per hour and it will probably take 2-3 hours.

    What I was getting at is this. Are there customers out there that will hire someone to install a fan or do other similar work on an hourly bases?

    In my area people want to know what the cost will be for electrical work. Not how much I charge per hour. I could say $20 per hour and they still would want to know what it would cost. Besides, how many fans do I need to install until I learn that it takes about 2 hours start to finish?
    I do "C". Everybody seems to have a different take on this. Perhaps customers in different areas react differently. I give fixed prices on very few jobs. (Ceiling fans being one of them.) I charge an hourly rate + a trip charge + material x markup + rentals. I itemize all of that on my invoice. I get no pushback from customers. The majority of my customers are upper income. Perhaps that's the difference. Perhaps it's because the people that ask detailed pricing questions aren't the ones who hire me which is fine because I'm very busy with people willing to pay what I think I'm worth.

    P.S. I'm still learning how to estimate my time. I routinely underestimate my hours so I routinely end up saying "Sorry, it took me a bit longer than I expected." Their response is usually "How should I make out the check?"

  5. #25
    Join Date
    Feb 2003
    Location
    New Jersey
    Posts
    3,338
    I just want to add this to what has already been mentioned. In NJ it is unlawful to charge a HO on a T&M basis. You should look at the Board of Electrical Examiners website and find and read through the Statutes and Regulations document

    http://www.njconsumeraffairs.gov/ocp...gulations.aspx

    You'll come to this section :

    http://www.njconsumeraffairs.gov/reg...ontractors.pdf

    If you're just performing a straight forward service call (i.e changing a switch, receptacle or a breaker) you can probably get away with that unless the work becomes more extensive than just an hour or so worth of work.

    Hope this helps

  6. #26
    Join Date
    Dec 2007
    Location
    NE Nebraska
    Posts
    32,914
    Quote Originally Posted by Greg1707 View Post
    I posted earlier about the three answers to the question how much do you charge to install a ceiling fan?

    A. $250
    B. I charge $100 per hour.
    C. I charge $100 per hour and it will probably take 2-3 hours.

    What I was getting at is this. Are there customers out there that will hire someone to install a fan or do other similar work on an hourly bases?

    In my area people want to know what the cost will be for electrical work. Not how much I charge per hour. I could say $20 per hour and they still would want to know what it would cost. Besides, how many fans do I need to install until I learn that it takes about 2 hours start to finish?
    My answer is D. "I need to know more about what I may run into before I can tell you"

    Couple times have had to spend 2-3 hours plus a helper just setting up scaffolding to get to a fan in churches where the fan was 30 feet off the floor, fixing/replacing the fan was otherwise quick and simple.

  7. #27
    Join Date
    Jun 2005
    Location
    NJ
    Posts
    673
    Quote Originally Posted by staticcontrol View Post
    Hello Fellow Electricians.
    Can someone please share some knowledge here.

    I have a small company in NJ. What is an acceptable hourly rate to invoice a customer for 2 guys doing service work? And do you charge a higher rate for the 1st hour and then default to another rate for each additional hour? If so, is it to much to ask what going rate is?

    Any input particularly from a company in NJ would be appreciated.

    SINCERELY
    STATICCONTROL
    Sometimes it's hard to just get a straight answer without the discussion veering away from your original question. So I'll just answer your question for you.
    A service call is $99 for the first half-hour and $99 for each additional hour (rounded to the next quarter-hour). This is just for service work.
    We're in Middlesex County.
    John

  8. #28
    Join Date
    Jun 2016
    Location
    Tampa, FL, USA
    Posts
    865
    Quote Originally Posted by kwired View Post
    My answer is D. "I need to know more about what I may run into before I can tell you"

    Couple times have had to spend 2-3 hours plus a helper just setting up scaffolding to get to a fan in churches where the fan was 30 feet off the floor, fixing/replacing the fan was otherwise quick and simple.
    I think that went without saying. If someone can't explain their job clearly to me in two sentences and it sounds like it might take more than a few hours, I'll just go over and take a look if they need an estimate. The reason I like T&M is because except for the simplest jobs, you never really know how long it will take without a detailed look. And even then, you really don't know.

    Even something as simple as a ceiling fan installation requires an extensive question and answer session on the phone before a quote can be made.

    "Is there a fan there now?"
    if not, "Is there a box to mount a fan on there? (probably with a white blank cover.)"
    if not, "Is there an accessible attic space above where the fan will be going?"
    if not, "Is it OK if we cut your drywall ceiling and wall to get the wiring in?"

    "How high is the ceiling?"
    "Will the fan have a remote control?"
    if not, "Will the fan have a light?"
    if ceiling is 10 feet or less
    if a light, "Do you want a switch to control the light or will you use the pull chain?"
    "Do you want a switch to control the motor or will you use the pull chain?"
    if yes, "on/off or three speed?"
    Tall ceiling
    "a switch to control light (if present) and motor is required. Do you want on/off or three speed?"
    Last edited by Coppersmith; 05-18-17 at 11:09 PM.

  9. #29
    Join Date
    Jun 2016
    Location
    Tampa, FL, USA
    Posts
    865
    Quote Originally Posted by goldstar View Post
    In NJ it is unlawful to charge a HO on a T&M basis.

    I skimmed the document you linked and could not find where a T&M job is prohibited. I did find this section which seems to indicate that T&M jobs ARE allowed:

    "iii) The total price or other consideration to be paid by the buyer, including all finance charges. If the contract is one for time and materials, the hourly rate for labor and all other terms and conditions of the contract affecting price shall be clearly stated;"

  10. #30
    Join Date
    Feb 2003
    Location
    New Jersey
    Posts
    3,338
    Quote Originally Posted by Coppersmith View Post
    I skimmed the document you linked and could not find where a T&M job is prohibited. I did find this section which seems to indicate that T&M jobs ARE allowed:

    "iii) The total price or other consideration to be paid by the buyer, including all finance charges. If the contract is one for time and materials, the hourly rate for labor and all other terms and conditions of the contract affecting price shall be clearly stated;"
    That's correct but I believe you cannot perform the T&M on an open ended basis (i.e. I get $100.00/hr and not sure how long it will take). You have to state in writing what your rates are and how long you believe it will take (or not to exceed in terms of time and $$). The HO has to know up front approximately how much the repair or job could end up costing.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •