Bidding low rise multi-family residential

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petersonra said:
There is no requirement that your rate be justified at all. It's all about whether your rate is acceptable to the customer. Most times no one is going to care all that much if they have to pay $200 an hour to get their electrical service fixed if they have no power and have to call someone out in the middle of the night to fix it. There are less likely to want to pay those kind of rates to have a whole house wired.
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I know what you are saying. And I'm an advocate of extracting as many funds as possible. But I've also put together a lot of bids that were nowhere near competitive because the rate was too high compared to the other bidders. The rate couldn't be justified to the one who's paying for the work to be done.

Like I said, doing some kind of service work the rate is going to be higher. Primarily because there's a lot of behind-the-scenes work and expense per production hour

But if you're doing some kind of cookie cutter assembly, most people aren't going to pay that kind of money strictly for on-site hammer swinging.
 
petersonra said:
I find it curious that one of the posters thinks it is almost criminal to pay less than what he is paying his employees.

I don't know how much of that $25 an hour he is budgeting for labor goes for fringe benefits and other direct labor costs like unemployment insurance and workers comp. I bet you that $25 an hour gets down to 10 or $12 an hour pretty quick once you figure in the cost of health insurance, although being in Canada you do have a slight advantage there.
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For me, when I say $25/hr average wage, that’s the employee pay. In the bid that translates to about $43/hr.


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James L said:
Exactly. That's my point.

If you do service work, where estimating can realistically amount to 25% of your time, you have to charge $100+ per production hour in order to cover that much nonproduction time.

But if estimating only accounts for 3-5% of your time, there's no way it justifies that kind of production rate.
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Perhaps start a thread about service work labor charges. The OP is specifically talking about large projects with thousands of estimated man/hrs, where your statement doesn't apply
 
cdslotz said:
Perhaps start a thread about service work labor charges. The OP is specifically talking about large projects with thousands of estimated man/hrs, where your statement doesn't apply
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Keep reading, you should see.

My statement absolutely applies. You got people talking about bidding large projects with an hourly rate that you're only going to get on service work.

The reason you get that kind of rate on service work is that you have a lot of non-production off-site time that has to be absorbed into the hourly rate.

But when you have a very large project, like the OP is talking about, you don't put a service rate on it.
 
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