Overhead

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FVC electric

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Question:

im in trying to calculate my overhead. How do I apply my salary. On average 2 days a week I work in the field with my tools. That time (16 hours) would not be applied to the overhead because that's a direct job expense. The rest of the week I'm doing office/management work. How do I apply that time to overhead. Would I just say around 2/3 of my salary get included?
 
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FVC electric

Member
Bob, question....I should tell the office staff the same thing. I'll pay you at the end if the year?


Cadpoint, the link for overhead did not work. Thank you
 
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petersonra

Senior Member
Location
Northern illinois
Occupation
engineer
FVC electric said:
Bob, question....I should tell the office staff the same thing. I'll pay you at the end if the year?
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No. Paying the staff and the other bills comes before your pay, assuming there is anything left.

There is nothing that says you cannot collect some of what is left over along the way but the bottom line is that if there is nothing left to pay yourself with there just won't be any pay for you.

Small business owners often end up earning less than what they could make working for someone else. It is hard to consistently turn a profit.
 
mjf

mjf

Senior Member
Location
The incredible, yet very expensive, Hudson Valley,
petersonra said:
No. Paying the staff and the other bills comes before your pay, assuming there is anything left.

There is nothing that says you cannot collect some of what is left over along the way but the bottom line is that if there is nothing left to pay yourself with there just won't be any pay for you.

Small business owners often end up earning less than what they could make working for someone else. It is hard to consistently turn a profit.
Click to expand...


The above is one reason the OP is trying to determine his overhead. He specifically asked about his salary, not his businesses profit.

To the OP: You are an employee of your business. Figure your salary into your overhead as you would any other employee.

Hopefully your business is profitable and there is money left after ALL overhead. If not, I guess your salary lessens and there is no profit for your business.
 
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FVC electric

Member
Thank you MJF, another question for you:

include all 3 insurances in my over cal then / by gross sales

or

break out the ins cost and / that by total annual employee labor costs. Then include that to my labor rate per hr?

Any thoughts?
 
Fulthrotl

Fulthrotl

~Autocorrect is My Worst Enema.~
Location
HB, CA (19 Hrs. 22 Min. from Winged Horses)
Occupation
E
mtfallsmikey said:
http://www.barebonesbiz.com/

Mainly for plumbing contractors, but same principles apply.
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saved me having to post the link.... download her "weekend business plan"
and do it.

this time of the year, being tax season, is an excellent time to do this,
as you have crunched all the numbers for your tax prep.....

you *have* crunched all those numbers, right? :happyno:

get ready for an interesting emotional ride as you find out how much
you need to bring in the door for each billable hour, to actually function
as a real business.

it's about twice what most electricians charge, which explains the failure
rate.

it also clears up why flat rate pricing is about the only solution that lets
you function well.... most folks figure in the $75~$85 per hour range
for electricianeering..... add a buck to that number, and it becomes real.
but you can't tell someone you are $175 an hour. people who have just
had strokes can't sign checks.

so.... flat rate pricing is born.

electrical flat rate pricing is an excellent place to start, right after ellen.

http://www.electricalflatrate.com/

jim is an excellent guy, and on this forum, as a matter of fact.
 
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