Help with pricing....

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MJReigle

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I am just starting out and I am pretty much working solo. I was contacted by a builder that I know to wire his home. He knew I would be a little more expensive than other contractors he could use but was willing to pay for quality work. His house is about 2400-2500 sq. ft. on the first floor and roughly 800-1000 sq. ft.on the 2nd. floor. It has a 3 car garage and a full unfinished basement. He wanted to buy all the material and pay me an hourly rate...whatever time it took me to finish. The rough in took me 71 hours plus another 20 for a journeyman and 30 for a helper that I used. He is paying them directly. I originally told him $70/hr for me but now Im thinking that may be a little high as this may lead to future jobs. My question is does almost $5k
(for the rough in) for me sound steep or would your numbers be in line with mine? I was considering billing him for $70/hr and then showing a discount so it would appear I was working with him. I would end up in the $60/hr range. Do the man hours seem to be a little high?
 
did you not agree to an hourly rate when you took the job? stick to it or he may think you are somehow cheating him.

never believe the stories or implications about any job leading to future business. it almost never happens when they bandy it about.
 
first, read this book and this one also.

these books are perfect for you.

also, as stated above, stick to your price. after you read those books you'll be more confident in knowing what you should charge. i get that "i'll give you more work" line all the time. it never happens, so don't worry about that. don't give the customer the impression that you're making enough off their job to offer a huge discount.

also, get accustomed to estimating. its not very hard in new residential; just takes a little time to get your labor units on paper.

finally, there's no way for us to know if $5k in labor is an adequate number for the rough-in. it really depends on the scope of the work (is it a code job or are there many extras, etc. . .?) just read those books and get a book to help you with estimating and you'll be all set. . . for now.
 
You took that job on really screwed up terms.

Are you seriously in business, or an electrician hobbiest? Why would you let him buy all the material and pay your help directly? That's industrial-strength stupid. If you don't have credit enough to buy material and the proper insurances, etc to pay your men properly yourself, you're not seriously in business.
 
mdshunk said:
You took that job on really screwed up terms.

Are you seriously in business, or an electrician hobbiest? Why would you let him buy all the material and pay your help directly? That's industrial-strength stupid. If you don't have credit enough to buy material and the proper insurances, etc to pay your men properly yourself, you're not seriously in business.
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well, it did need to be said.

but don't take offense there reigle. everyone has a starting point.

i was hoping he'd just do some reading and figure out he needs to be making money off the material as well.
 
MJReigle said:
I originally told him $70/hr for me but now Im thinking that may be a little high as this may lead to future jobs. My question is does almost $5k
(for the rough in) for me sound steep or would your numbers be in line with mine?
Click to expand...

You asked for $70 and hour and he accepted that's what it is.

It not really to much at all. You didn't make any money on materials and none on the other labor but if you permitted the job then you are now responsible for the whole job. Don't forget that you may end up making a couple of call back trips for free.

Don't worry about charging the builder to much because he's going to screw you out of it latter on anyway. :wink: If he don't he will at least try to.
 
brantmacga said:
first, read this book and this one also.

these books are perfect for you.

also, as stated above, stick to your price. after you read those books you'll be more confident in knowing what you should charge. i get that "i'll give you more work" line all the time. it never happens, so don't worry about that. don't give the customer the impression that you're making enough off their job to offer a huge discount.

also, get accustomed to estimating. its not very hard in new residential; just takes a little time to get your labor units on paper.

finally, there's no way for us to know if $5k in labor is an adequate number for the rough-in. it really depends on the scope of the work (is it a code job or are there many extras, etc. . .?) just read those books and get a book to help you with estimating and you'll be all set. . . for now.
Click to expand...
Those by far are the best books I have ever read when it comes to buisness
 
mdshunk said:
You took that job on really screwed up terms.

Are you seriously in business, or an electrician hobbiest? Why would you let him buy all the material and pay your help directly? That's industrial-strength stupid. If you don't have credit enough to buy material and the proper insurances, etc to pay your men properly yourself, you're not seriously in business.
Click to expand...

I think he's far from stupid, In fact I think he's pretty smart, He's working, and he's joined a really good forum where people are helpfull and where he can gain wisdom in the trade. He will learn like you did..

EVERYONE has to start somewhere. And this is a great forum to do just that.
 
MJReigle said:
I am just starting out and I am pretty much working solo. I was contacted by a builder that I know to wire his home. He knew I would be a little more expensive than other contractors he could use but was willing to pay for quality work. His house is about 2400-2500 sq. ft. on the first floor and roughly 800-1000 sq. ft.on the 2nd. floor. It has a 3 car garage and a full unfinished basement. He wanted to buy all the material and pay me an hourly rate...whatever time it took me to finish. The rough in took me 71 hours plus another 20 for a journeyman and 30 for a helper that I used. He is paying them directly. I originally told him $70/hr for me but now Im thinking that may be a little high as this may lead to future jobs. My question is does almost $5k
(for the rough in) for me sound steep or would your numbers be in line with mine? I was considering billing him for $70/hr and then showing a discount so it would appear I was working with him. I would end up in the $60/hr range. Do the man hours seem to be a little high?
Click to expand...

One things for sure, you will learn how many hours it will take, and cant loose. You will also learn how much material it will take at someone else's expense. Then next time you will be able to bid with more confidence, nowing actual cost.
 
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MJReigle said:
I originally told him $70/hr for me but now Im thinking that may be a little high as this may lead to future jobs. My question is does almost $5k
(for the rough in) for me sound steep or would your numbers be in line with mine?
Click to expand...
You told him $70, he agreed, that's the charge.

Believe me, he got a bargain even at that price.

Worry about future work when and if it happens.
 
i heard a lot of people talking about future work if you give them a deal or whatever. i think its just a way of getting people to actually do the work and they have no intentions of giving them any future work. but maybe he will anyway who knows
 
I don't think the OP said the Builder promised future work if he got a deal on this job.

The OP said he was thinking of lowering the rate to possibly get future work from the builder.

I think your rates are low as it is, when your first starting out it is tempting to low ball jobs to get work. Don't do it. You will end up super busy and wonder why you still can't pay the bills. You will also end up with a customer base that will call the next cheapest guy once you raise your rates to stay in business.

If you do quality work, show up when you say you will , and are professional you will get plenty of work. People are willing to pay for quality. You said yourself that this builder didn't want to use his regular guy. He knows how those low baller guys do things.
 
Take the $70 you talked about with him. Charge more when times are tight.

P.S. what are you doing on here at 5:04pm............
 
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Long night of thinking everything over......final decision-keep the $70 rate and dont worry about future work and let the quality of the job be the reason for more work and not the low ball price.

By the way what are you doing here at 11...shouldn't you be at the dew drop?
 
Mule said:
One things for sure, you will learn how many hours it will take, and cant loose. You will also learn how much material it will take at someone else's expense. Then next time you will be able to bid with more confidence, nowing actual cost.
Click to expand...

Excellent point....I recently did a new home time and material. This was my first new construction in about 2 years since I am always to high when I bid to win the job. I tracked my time very closely on this job because I looked at it as a way to sharpen my bidding skills on future projects on somebody else's nickel.

One of the things I learned is that I'm much better off ($ wise) to stick with service and upgrade work but when the next new home opportunity arises I have solid real world numbers to use on the next.
 
I agree Jeff, I think this a really good opportunity to get a good idea of the amount of man hours and just how much material a custom house will eat up. I think once Im done with this one I will have a good idea for my next bid.
 
ElectricianJeff said:
Excellent point....I recently did a new home time and material. This was my first new construction in about 2 years since I am always to high when I bid to win the job. I tracked my time very closely on this job because I looked at it as a way to sharpen my bidding skills on future projects on somebody else's nickel.

One of the things I learned is that I'm much better off ($ wise) to stick with service and upgrade work but when the next new home opportunity arises I have solid real world numbers to use on the next.
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chances are if you don't do that kind of work regularly, you will take more time than someone who does it everyday.

that is one of the reasons why we sometimes turn down work on things we are unfamiliar with.
 
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