Let me say 1st, that this is just my opinion.
What SGR is finding out about his break even cost is more for service work.
Which that number is always higher than what you would use when you are bidding commercial work or residential.
One reason is that on service work the average tech can only bill out for 5 hours a day, hence making the hourly rate more expensive, versus having a guy on the job site from 7:00am to 3:00 pm.
Lets say hypothetically speaking, Your overhead is $5000.00 a month. You bid a commercial job and your take off came up to 50,000. Now you add %10 overhead then 15% for profit.
That's $5000.00 for overhead and $7500.00 for profit.
Merritt shop or union shop, doesn't matter, Lets say total package for a jw is 33.00. Lets say that's the wage you plug in for estimating.
Now lets say that on that same $50000 job your total man hours were 500
The rest was material, lights and gear.
500 hours x $33.00 dollars an hour equals $16,500, Don't forget the tax burden.
You cant take that $132.00 hour labor rate and multiply that number by 500 hours, which will equals $66,000 plus the material which was $33,500.
Total price for the job, $99,500 and still add profit, You will never get a commercial job.$66,000 vs $16,500 labor cost.
I bid allot of commercial and its a very tight market, Jobs are being done at cost right now or sometimes even less. Very disheartening.
My labor rate is $150.00 an hour, But that is not the number I use when I'm bidding commercial or industrial work.
