Billable Hours

[jgarner]

There are 2080 hours a year working 40 hours a week. Out of that, how may would be consider billable? Small 1 - 2 man operation. Trying to work up hourly rate sheet. Included following:
Salary $47,840.00
GL cost 3%
WC cost 7.8%
Truck expense 8%
Unemployment tax 5%
Labor burden 23%
Using 1820 billable hours with 10% profit hourly rate works out to $42.30 hour.
Does this sound about right?

 

[Mule]

There are 2080 hours a year working 40 hours a week. Out of that, how may would be consider billable? Small 1 - 2 man operation.

These size EC's generaly dont have a secretary, estimators, schedulers, etc.. so the EC has to do all of the planning, which takes away from daily billable hours, and you can recover some of it, but not all.

With that said, this describes my business, and we average 5.5 to 7.5 billable hours at our regular rate, and can average full 8 hrs at a reduced rate.

I try really hard to do all of my invoicing and planning on the customers time and billfold....

 

[Rewire]

The secret to sucsess in business is only work half a day.....and it doesn't matter which 12 hours.

 

[Mule]

The secret to sucsess in business is only work half a day.....and it doesn't matter which 12 hours.

Sucess, in your definition would be wealthy, for me its a balanced life style.

I've worked 16's, 12's, turnarounds with 16'-18's for 4-6 weeks, shift work, you name it, and less money, and time with my wife and family is much more apealing to me... But to each their own IMO...Its America

 

[Rewire]

Sucess, in your definition would be wealthy, for me its a balanced life style.

I've worked 16's, 12's, turnarounds with 16'-18's for 4-6 weeks, shift work, you name it, and less money, and time with my wife and family is much more apealing to me... But to each their own IMO...Its America

That"s the difference between being a self employed electrician and being in business as an electrical contractor.You should note the post was about sucsess in business and not about how I gage sucsess in life. The sucsess of my business now allows me the freedom to enjoy more time with family and the financial means to provide them with a higher standard of living.

 

[bradleyelectric]

depending on what type of work you are targeting. 50-70%

 

[Mule]

That"s the difference between being a self employed electrician and being in business as an electrical contractor.You should note the post was about sucsess in business and not about how I gage sucsess in life. The sucsess of my business now allows me the freedom to enjoy more time with family and the financial means to provide them with a higher standard of living.

So in truth, your now saying that you dont put in 12 hours...so which is it?

I think your trying to say, that the fruits of your (12hr) labor have paid off.

Not trying to judge you brother, just stating how I think and function.

And I like your statement here....the difference between being a self employed electrician and being in business as an electrical contractor....Yep, Im more the self employed electrician, now getting to whole enchilada, instead of my employer eating half of it before I get the table scraps....

 

[satcom]

In todays economy $5000 a week in the contracting business would not be considered wealth, it may be more like just getting by with a small business. to a self employed electrician, $ 1000 a week may look like wealth. It's all in what you want to do with your life!

 

[Mule]

In todays economy $5000 a week in the contracting business would not be considered wealth, it may be more like just getting by with a small business. to a self employed electrician, $ 1000 a week may look like wealth. It's all in what you want to do with your life!

Well put....but $1000 a wk wont cut it for me, maybe $2000...

 

[Rewire]

So in truth, your now saying that you dont put in 12 hours...so which is it?

I think your trying to say, that the fruits of your (12hr) labor have paid off.

Not trying to judge you brother, just stating how I think and function.

And I like your statement here....the difference between being a self employed electrician and being in business as an electrical contractor....Yep, Im more the self employed electrician, now getting to whole enchilada, instead of my employer eating half of it before I get the table scraps....

I think you were reading way to much into a tounge in cheek statement.But reality is that to build a business you have to break away from the 8 hour a day mentality.I don't need to spend the hours in the business like I did in the early days because I now have people in place to take some of the burden I have guys to work the after hours calls and an office manager to take care of invoicing so I have time.I think a business sucsess is being able to step away and the business still runs.The reward was last year I flew the family to Orlando we did the Disney thing and I got to attend Mikes code update seminar,and when I returned after a week away the doors were still open.

 

[Mule]

I think you were reading way to much into a tounge in cheek statement.But reality is that to build a business you have to break away from the 8 hour a day mentality.I don't need to spend the hours in the business like I did in the early days because I now have people in place to take some of the burden I have guys to work the after hours calls and an office manager to take care of invoicing so I have time.I think a business sucsess is being able to step away and the business still runs.The reward was last year I flew the family to Orlando we did the Disney thing and I got to attend Mikes code update seminar,and when I returned after a week away the doors were still open.

Your right, Sounds good to me, not a problem....Im just a even smaller operation, just doing what I love to do....and making a good living, and enjoying my customers and my work...

 

[Rewire]

Your right, Sounds good to me, not a problem....Im just a even smaller operation, just doing what I love to do....and making a good living, and enjoying my customers and my work...

I have threeJWs an apprentice the office manager and me so its not like I am huge.And like you I love what I do .An early mentor of mine told me "just because you love the smell of flowers does not mean you should be a gardener,you gotta like the smell of manure too."

 

[Sparky555]

There are 2080 hours a year working 40 hours a week. Out of that, how may would be consider billable? Small 1 - 2 man operation. Trying to work up hourly rate sheet. Included following:
Salary $47,840.00
GL cost 3%
WC cost 7.8%
Truck expense 8%
Unemployment tax 5%
Labor burden 23%
Using 1820 billable hours with 10% profit hourly rate works out to $42.30 hour.
Does this sound about right?

Billable hours vary with the type of work you do. Residential service is around 1000-1200 hours per year. Commercial installations where the job runs day after day might be around 1600-1700. Someone else on the forum can give you the correct number for that.

IMO you're too high with 1820 hours, and too low at 10%. If you stay with 10% at least calculate your unbilled time for call-backs & warranty work. If my target was 10% I'd calculate at 20% to hope to end up with 10%.

 

[tonyou812]

I think you were reading way to much into a tounge in cheek statement.But reality is that to build a business you have to break away from the 8 hour a day mentality.I don't need to spend the hours in the business like I did in the early days because I now have people in place to take some of the burden I have guys to work the after hours calls and an office manager to take care of invoicing so I have time.I think a business sucsess is being able to step away and the business still runs.The reward was last year I flew the family to Orlando we did the Disney thing and I got to attend Mikes code update seminar,and when I returned after a week away the doors were still open.

That must have been a good feeling. I cant wait untill i get to that point. to me a buisness is a buisness when you can step away for a while and its still making money for you and your family. Otherwise your just self employed.

 

[emahler]

That must have been a good feeling. I cant wait untill i get to that point. to me a buisness is a buisness when you can step away for a while and its still making money for you and your family. Otherwise your just self employed.

that's the goal...now the guys i look up to are the one's who can take a month off, and come back to a machine...and I know a bunch of them...any of them that run resi service, follow the same business model...simple as that...

 

[tonyou812]

that's the goal...now the guys i look up to are the one's who can take a month off, and come back to a machine...and I know a bunch of them...any of them that run resi service, follow the same business model...simple as that...

I know i worked for a guy out of Landing for 3 and a half years. He would go away at least 3 to four times a year and sometimes on his boat with his wife. And why not he busted his but for years. I want to model my company after his. It was a great place to work and he really had his stuff together. It really was a well oiled machine.

 

[jim dungar]

There are 2080 hours a year working 40 hours a week.

Most people consider a year to have 2000 billable hours at straight time. In general most people get about 10 holidays a year. It does help with the math slightly, but this way you would be talking apples to apples when comparing to federal or national numbers.

 

[aline]

that's the goal...now the guys i look up to are the one's who can take a month off, and come back to a machine...and I know a bunch of them...any of them that run resi service, follow the same business model...simple as that...

I know i worked for a guy out of Landing for 3 and a half years. He would go away at least 3 to four times a year and sometimes on his boat with his wife. And why not he busted his but for years. I want to model my company after his. It was a great place to work and he really had his stuff together. It really was a well oiled machine.

Why would anyone want to do this if they love what they do like many contractors say they do?

Would you really want to spend less time working? Something you love to do?

I can think of a lot of things I love to do that I'd rather be doing other than electrical contracting. I may like doing it but I sure wouldn't say I love it. I do it so hopefully I'll have the money to do the things I really love.

If you didn't get paid anything or make any money doing electrical contracting would you still do it? Would you be willing to spend money doing it without receiving any money in return? If not I wouldn't say you love it. Oh wait. Never mind. Many contractors are already doing this so I guess they really do love what they do.

 

[Mule]

Why would anyone want to do this if they love what they do like many contractors say they do?

Would you really want to spend less time working? Something you love to do?

I can think of a lot of things I love to do that I'd rather be doing other than electrical contracting. I may like doing it but I sure wouldn't say I love it. I do it so hopefully I'll have the money to do the things I really love.

If you didn't get paid anything or make any money doing electrical contracting would you still do it? Would you be willing to spend money doing it without receiving any money in return? If not I wouldn't say you love it. Oh wait. Never mind. Many contractors are already doing this so I guess they really do love what they do.

I truely love my work, I dont want to do it all of the time because there is other things I love as well. To each their own, but some people go to work just to make money, and I did that for years, and got sick of it. Now I work for myself, I love the social part of my work, and have purpose in providing a safe electrical system for my customers......the payment is nice and I cant exist without it, but personaly I had to re-focus my thinking and Im a much happier person for it....

 

[SEO]

Mule sure sounds like your happy and having a good go at life. Good for You!:smile: