DOH!!!!

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hardworkingstiff

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Location
Wilmington, NC
Well chit. I got a little too tired today. I've been working on some estimates for the last couple of days and I really blew it today. I do my estimating in Excel. I have multiple worksheets in it. One of the worksheets was the panels schedules. I wanted to email this and a copy of the CAD drawing showing the wire and panel layout I was quoting to the GC's engineer. What I do is copy and paste the one sheet into a different file and send that info. Well, guess what. I copied the whole workbook and sent it with the site plan to the engineer, and ..... copied the GC. So now he sees my cost, markup, my complete estimate.

So here is my question.

What do you guys put on materials for a markup?

Do you mark up switch gear and big ticket items at a lower rate?

What is your general per day charge for labor for a day (3-men). What do you allow for out of town?

If you think this is too personal for this forum, please PM me.

I might have been a little zealous on this estimate. Any suggestions on how to deal with the customer when they eventually start picking me apart?

Thanks.
 
Re: DOH!!!!

I generally mark up materials 20%. Possibly less for a big ticket item. I base rates at $75.00/ hr. for a licensed man and $50.00 for an apprentice.

You don't have to justify your costs, in my opinion. You gave a quote, and if the GC accepts it, fine. If you were a little overzealous, I'd try to explain that I were trying to account for variables, unknowns, etc. Or go for the insanely high escalation of material cost excuse. Many products have increased substantially.

If you were extremely high in your figures, you might be SOL.

Good luck!
 
Re: DOH!!!!

Since you're Emailing all your best keps secrets, how 'bout a copy? :D

I use a sliding scale for markups, with nickel-dime stuff being around 6 times, and 5 digit stuff around 1.25 times. I have a formula that I made up in Excel that figures it all out. I've never accidentally emailed it to anyone, though.
 
Re: DOH!!!!

Legit people know what it cost to run a business. If they start picking everything apart, you cant retreat. Hold firm and keep your credibility and integrity.
 
Re: DOH!!!!

Here's a copy of the chart I use:

attachment.php
 
Re: DOH!!!!

I base rates at $75.00/ hr. for a licensed man and $50.00 for an apprentice.
Click to expand...
So your man hour rate is $62.50, in other words if your man hours for a job are
30 man hrs x $62.50=1875.00 for labor (2 men on the job)
Material price $300.00 x 20%=$360.00,
Is this correct?
 
Re: DOH!!!!

In my example the job would be done in 15 actual hrs. One hour short of two eight hour days
2 men 15 hrs each =30 man hrs.
 
Re: DOH!!!!

I mark up 30% on the pre-tax cost I pay at the supply house. I have to pay sales tax of 7%, so I guess that would make my markup 23%.

The biggest-ticket items I buy are generally under $500 (e.g., a tandem meter socket), so I apply the same markup to everything equally. It's easier that way.

Labor is billed out at $85/hour. Since I'm a one-man shop, customers always get a licensed master electrician and get to deal directly with the boss. :D

I try to stay fairly close to home because I'd rather do electrical work than drive all over the place, but in cases where I do wind up doing more driving than average, I'll tack on a trip charge.

Yeah, it was an oops to send out all that information, but I don't think there's anyone on this forum who hasn't made a few mistakes of similar magnitude. As long as you weren't trying to rip him off, I'd say it's not a big deal. I agree with Jim -- don't let them use this information against you.
 
Re: DOH!!!!

Send him another e-mail stating that the information given in the first e-mail is proprietary information, and is not to be dispensed to any third party under any circumstances. Include a vague reference to legal action for any violation of this. This guy might be the type to hand your entire bid over as a bid shop method. You just never know....
 
Re: DOH!!!!

Originally posted by jeff43222:
I mark up 30% on the pre-tax cost I pay at the supply house. I have to pay sales tax of 7%, so I guess that would make my markup 23%.
Click to expand...
Should I nit pick? :) Your markup would not be 23%.

First, is the markup a percentage of your cost or what the customer is charged? I have heard markup means the percentage of what the customer is charged. Does everyone agree? A 33% markup using this method is 50% of your cost, so it makes a difference.

Saying a markup on the pre-tax cost tells me Jeff is using a percent of the cost. So the $100 item he charges $130 for, but he pays $107 with tax. The $130 is about a 21.5% markup (percent of cost) or about 17.7% markup as percent of what the customer is charged.

But if Jeff means the markup is 30% of the customer price and the markup includes the sales tax, the $100 item he would charge 142.86 for, which is a markup of 25.1% of the customer price treating the sales tax as cost.

It isn't 23% either way. ;)

[ January 20, 2006, 12:18 PM: Message edited by: paul32 ]
 
Re: DOH!!!!

To add to Paul's confusing discussion, when marking up materials (at least in MA) you are required to charge your customer sales tax on the amount that you charge him for the material. If your pay sales tax when you purchase a product from the supply store, you are allowed to do this, but you are not allowed to then mark up the material. But who's checking :)
 
Re: DOH!!!!

Fortunately I don't have to charge sales tax on any materials I bill the customer for provided I install the materials. I don't want to get into having to keep even more records, and I'm not interested in becoming a material supplier.

As for my math, my intention was that the markup of the original cost was 23%. So if the item cost is $100, the state marks it up 7%, and I mark it up another 23% (of the original cost), for a total of 30%, and I bill the customer $130. All those years in engineering school did teach me that 107/130 isn't 23%. Leave it to a fellow Minnesotan to nit pick. :D
 
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