Lets talk about markup shall we?

[e57]

I worked as a subcontractor for ---- electric, and he told me everything i sell mark it up times three.

This guy from Hayward?

I used to work for a 'four letter word' Electric there back in the early 90's - invoice X3, Blue book column 2 X2.

I did a service call for an Accountant (Bad GFCI) and handed her a bill for .5 labor under a 1 hour min w/ service charge and a $135 GFCI receptacle and she had a conniption. (total around $250) Accused me of highway robbery and was dialing the cops... Broke it all down for her - 'this book, this item, this column X2 + 1 hour min and $15' She renegotiated the bill to $150 with the boss....

 

[cadpoint]

I mostlly (is that a word?) agree with mule..

I live in a small town near the big city. If I charged $60 for a ballast, word would get "around" and I would probably lose new customers. I could probably get away with $30.

HOWEVER, IF a customer pays me the hourly rate to goto the supply house and back ,I feel its hard to justify the 3X upcharge.

A small customer woud go Ballistic (ballast-tic)- pun intended -if I charged $300 to fix a 2X4 lay-in fixture.

-$90 ballast + 2hrsX $100hr(2men) + $10 for wirenuts etc.. = $300

Small town and ethics, yeah, but the point to it was, was is it a service call, a client emergency, it all seemed like a "what if", than an exact situation. OK, as I read it!

I've read enough here to not go high browe on the price or total cost,
in respects to being a local, regional, thing. I can argee with others on both sides of the arguement. It's such a no win conversation verses
ones prespective as to how one bills.

There always seems to be some available sliding scale on the total sum due! ( other's have there price- Well hello they know there Business now don't they)

Be it a bid, or appliable to what makes up a cost of servicing a situtation, or doing business or whatever one what's to call it, or wherever one is with all this!

This is not just an electrical thing but a real life issue!

It been said here many times if you don't know your cost, well then you don't!

To me, it is our trade, its a craft that we've mastered, we have to deal with the/a pitch, please price accordingly!

To the orginal OP that I posted, your numbers are your assumed numbers...
(I'll even assume that it was something learned from being around here! )

Some can't equate to anything said here about all this, why not?
But they sure do like to mention how it is!

It was 3.375, for the mark up, as shown...

 

[e57]

Charging higher prices after a storm is supply and demand. If I bought 20 generators 6 months ago for 5$00.00 each. Why is it wrong to sell them at $1,250.00 each to people after a storm. Those that really need it will be weeded out from the folks that might want one.

Charging more after a certified natural disaster can land you in jail in some states. See paragraph 2.

 

[Mule]

Maybe I'm not understanding you correctly.
Are you saying that you cover all your overhead expenses with material markup?

It would seem to me you would have to mark materials up a lot in order to do this. Just opposite of what your saying you shouldn't do.

If you're covering all your overhead costs with material markup what happens when a job has little or no material involved?

I've always been of the understanding that overhead should be covered in the labor charges as much as possible.

Material markup would cover overhead costs associated with ordering, storing, handling and warranty of the materials.

Am I wrong in my thinking?

Just re-read post #5.....so I wont have to repeat it ....:grin:

Is it wrong?, not unless you disclose it on this forum....

 

[hardworkingstiff]

It is not wrong to make money.:smile:

Bob, you hit the nail squarely on the head with that one.

 

[LarryFine]

. . . and a $135 GFCI receptacle and she had a conniption.

For a $135 GFCI receptacle, I would have, too.

 

[hardworkingstiff]

For a $135 GFCI receptacle, I would have, too.

Yea, seems that the double book price was thrown at her. $135 GFCI receptacle seems like it would include labor.

 

[B4T]

I always mark up parts (X 3).. sometimes I get a complaint of why so much?? ANSWER It goes towards my one year guarantee for parts and labor and it is company policy to guarantee everything I do.

 

[brother]

For a $135 GFCI receptacle, I would have, too.

Oh my!! Just one thing that some 'bizness' owners need to remember is that you should bill out like you had a person working for you even though you are working for yourself. So if you had someone that you paid medical,insurance, retirement, etc.. on, you shouild bill your labor as that as well.

As far as material is concerned, yes you should mark it up, but within reason. Not sure if the sliding scale is the best way but like someone said, its a start.

 

[iwire]

Charging higher prices after a storm is supply and demand. If I bought 20 generators 6 months ago for 5$00.00 each. Why is it wrong to sell them at $1,250.00 each to people after a storm. Those that really need it will be weeded out from the folks that might want one.

I did not say selling was wrong I said gouging is wrong.

What is the definition of gouging? I can't define it, $1250 for a $500 generator sounds OK, 3K, 4K because they have no other choice is IMO wrong.

 

[bradleyelectric]

I mostlly (is that a word?) agree with mule..

I live in a small town near the big city. If I charged $60 for a ballast, word would get "around" and I would probably lose new customers. I could probably get away with $30.

HOWEVER, IF a customer pays me the hourly rate to goto the supply house and back ,I feel its hard to justify the 3X upcharge.

A small customer woud go Ballistic (ballast-tic)- pun intended -if I charged $300 to fix a 2X4 lay-in fixture.

-$90 ballast + 2hrsX $100hr(2men) + $10 for wirenuts etc.. = $300

What if you had a well stocked service truck and didn't have to go anywhere other than out to the truck to get the ballast?

 

[bradleyelectric]

This guy from Hayward?

I used to work for a 'four letter word' Electric there back in the early 90's - invoice X3, Blue book column 2 X2.

I did a service call for an Accountant (Bad GFCI) and handed her a bill for .5 labor under a 1 hour min w/ service charge and a $135 GFCI receptacle and she had a conniption. (total around $250) Accused me of highway robbery and was dialing the cops... Broke it all down for her - 'this book, this item, this column X2 + 1 hour min and $15' She renegotiated the bill to $150 with the boss....

I had a woman last week ask me if it was $250. to change that outlet. I assured here that was not the case at all. It was $250. to find what needed to be changed. I was including changing the outlet in the price. She was ok with that and had us come back the next day and do additional work for her. It's all in the presentation.

 

[aline]

Just re-read post #5.....so I wont have to repeat it ....:grin:

Ok. I re-read post #5 and it sounds like if the material sold doesn't cover your overhead expenses you increase the labor charges.

So if there is no material used at all then you would increase the labor charge enough to cover all the overhead expenses.

If you're charging T&M wouldn't your hourly rate to the customer always be changing?
Wouldn't they be confused by this and question it?

 

[Mule]

Ok. I re-read post #5 and it sounds like if the material sold doesn't cover your overhead expenses you increase the labor charges.

So if there is no material used at all then you would increase the labor charge enough to cover all the overhead expenses.

If you're charging T&M wouldn't your hourly rate to the customer always be changing?
Wouldn't they be confused by this and question it?

HA...you still are missing it.....no biggy...Im not good at explanations....

I dont increase the labor for the price of the part. Labor rate stays the same.

The markup rate is equal to the cost of part x 1.25(25%) or at minumum $10-15/billable hr.added to the cost of the part. did I say that right?

Of course this is contingent on Iwire convincing me otherwise....

 

[Mule]

So, where do I find this "Blue Blook" with different pricing columns?

 

[Sparky555]

HA...you still are missing it.....no biggy...Im not good at explanations....

I dont increase the labor for the price of the part. Labor rate stays the same.

The markup rate is equal to the cost of part x 1.25(25%) or at minumum $10-15/billable hr.added to the cost of the part. did I say that right?

Of course this is contingent on Iwire convincing me otherwise....

It seems a little devious to say you charge $65/hour plus materials at cost plus $10-15/hour minimum. IMO a more straightforward way of stating your charges would be $75-80/hour minimum plus materials at cost. It looks like you're hiding your true hourly rate.

 

[Mule]

It seems a little devious to say you charge $65/hour plus materials at cost plus $10-15/hour minimum. IMO a more straightforward way of stating your charges would be $75-80/hour minimum plus materials at cost. It looks like you're hiding your true hourly rate.

Everyone in town is $60-$65/hr and I never tell the customer my recipe for my markup, they only see the cost for materials on the invoice unless I have a TM agreement with them previously, parts are apparently lower than the average according to this forum. So I dont think it would be devious, no different than Marc's sliding scale IMO...Its just a way to calculate in my head to ensure that my overhead is being funded.

 

[ItsHot]

Marc

Marc

Where is Marc?

 

[Mule]

Guess he is banned.....really seems different

 

[ItsHot]

Guess he is banned.....really seems different

Will there be a hearing?