More $$$ ???

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rrrusty

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Colorado
My calendar is usually 3-6 wks out so I don't seem to be lacking for work (but I do get slow times); I charge hourly and have found that the most I can make a year is $xxx; Like everybody I would like to make more money but by working hourly I seem to reach a limit; I am a 1 person operation and most of the work I do is service work and small jobs (ceiling fans and light replacements); a couple of renovations and rewires as well as kitchen remodels
The thought of hiring someone does not intrigue me because of the amount of training I would need to do to have the person work at the same level of professionalism as myself would be tough as well as the additional cost of insurance; workmans comp; etc, and at times I do slow down to a point where I'm not sure I'll be working and so keeping the person that I have trained busy during the slow times will be a challenge; any suggestions?
 
Re: More $$$ ???

Sounds like you have all the facts in place.The only next move you can make is to get larger.In order for you to go the next step (hiring help)you will need to find lets say 80 hours of work per week.That means you will spend part of your 40 hours hunting for work,overseeing and training that new guy.Chances are he won't work as hard as you do.The cost of hiring is not cheap.Your going to find there will be times when there is not enough work for both of you.When you tell him you don't have work for a day or two he will likely go somewhere else.Your cycle has just began.If you have the financial backing you could spend full time seeking jobs and hire additional men.The sad part is if you really enjoy being an electrician you will find yourself taking your tool belt off and putting a salesman/managers/bidder/buyer, hat on.I know exactly where your at because i been there.What one can do is grow and your income depends on the profit you can make from your men.Should you be able to clear $10 hour after the real cost per man per hour(and that might be hard on some jobs)i am sure you can see how many men it requires before your making the money you want.
I think you already know most of what i said.
 
Re: More $$$ ???

Rusty:


If you stay sinigle only three ways (actually 4 see below) to increase your salary charge more for T or M or both. For us the profits with T&M billing is made with the M not so much the T. Look at your rates and mark-up on material. I find quite a few small shops do not have sufficent mark-up to cover actual overhead with a resonable profit. If you have too much work your rates are too low, what is the competion charging?
Are you competive or too low.

We are primarly a small speciality shop we do quite a bit of work for one and two man operations. We do the work, they make the money on marking up our cost to them. Does not take much additional mark-up on $X,XXX.XX to increase your take home
 
Re: More $$$ ???

Are you in tight with some of the smaller renovation/remodel/custom built GC's? My uncle was this type of GC for 40 years and never bid out the electric on his jobs, he stuck with the same small EC for decades until he retired.

Maybe more of those guys are trying to butcher up their own stuff these days though...I hear a lot of horror stories from the inspectors I use :D

What about 7x24x365 "emergency service". With plumbers, this seems to be a licence to steal. On hand supplies might need to be expanded a bit though. But a 15 minute "quickie" has the potential to put a $100 bill in your pocket (oh yes, cash would be fine madame :D )

[ January 05, 2004, 02:08 PM: Message edited by: tonyi ]
 
Re: More $$$ ???

I was working for one of my customers(3yrs ago) on a hot tub install and the customer said he needed some additional work to be done and he really liked the GC that he hired and gave me the additional work, Well the normal EC that the GC used at the time was booked out a lot farther than I and after he saw how my work was wanted me for his jobs; And then on one of the GC's jobs the cabinet installer saw the kind of work I do and now has his GC Lic and between the phone calls from the lighting stores and the 1 ad in a weekly paper as well as the 2 GC's I'm busy enough; And as far as the 24/7 svc calls I haven't been getting that many, but when they call I usually run
 
Re: More $$$ ???

One thing i did learn from previous EC company i owned was ,phones on at 7:00 am off at 4:00
pm m-f No job is worth 24-7
I work to live
I don't live to work
You need to have a normal family life and won't have that with phone ringing at 11pm
 
Re: More $$$ ???

We are a true 24X7 company, no Thanksgivings no Christmas and avoid working holidays when possible. It is amazing how many 24X7 contractors are not reachable after hours, we get ton's of calls from customers where we're the second choice, regular EC, then a call to us or someone that refers us. WE only do select calls, and usally for EC's we know or established customers.

This is our Money maker, And like plumbers who do not necessarily steal, but charge what the road will bear. We charge premium rates for this service. If you have a Ground fault PQ, ground issue, tripping CB ect and you need my/our service you will pay for it, we generally do not do small service calls such as tripped sign circuits, ect....
 
Re: More $$$ ???

A 24 hour service company in actuallity means that a call will be responded to within 24 hours of the call. It doesn't mean call me at 3:00am and someone will be there in 30 minutes or less.
Cudos to the person(s) who came up with caller I.D.!!
 
Re: More $$$ ???

I used to do call-out in England for my company. It was a nightmare. 3am call .. that means be there in 30 mins. The mill lost mucho-bucks / hour it was down .. the Production manager told me the figure was around $30,000 / hour in production profits, I never got the figures for utilities/wages/etc per hour ... but I figure at least triple that again. Losing $100K+ per hour and *I'll be there within 24hrs* was not an option LOL.

Worst thing was ... I was salary .. so no O/T just time in lew off /cry.

Shaine~
 
Re: More $$$ ???

I guess I should rethink the fee for a Midnite service run for someone who has lost main power and the temperature is 15-20deg; I used to just charge my standard hourly rate; I have raised my hourly for calls after 6:pm by just $10.00; Not enough eh? Ever notice that the main power usually goes out (bad C/B or dropped leg) when the temperature is down right cccold and in the middle of the night; I used to look at the situation as It wasn't planned and how would I feel if someone took advantage of me,I probably would not call or refer that person/ company; Am I wrong?
 
Re: More $$$ ???

I would say you're wrong. IMO.
I'm not sayin gouge anybody, but it is a major inconvenience and you've got to be compensated.
I'm usually just going to bed at 2:00am so to get me to go on a service call in the middle of the night is gonna cost somebody more than an extra $10 per hour.
 
Re: More $$$ ???

Well Rusty that depends on what you feel is "taking advantage". If you get out of bed at 1am because someone needs you and you have a hero thing happening...that's one thing. Presonally I'm not a fireman, or an EMT, I get out of bed in the middle of the night because it pays to do so, and that's it.

I need my sleep more than I need my hourly rate, or even twice my hourly rate, and if it's an honest to god emergency a customer should be prepared to for such. I'm not inhuman, if granny's respirator is down due to power out and money's an issue I'll fix it and stroll for free and consider my good deed done for the month. But the 3am call because the garage door doesnt work.....get the checkbook bud.
 
Re: More $$$ ???

I was just looking at all the emot-icons trying to figure out how I feel about all the varied responces. I've been doing electrical work for 12 years and quit the IBEW 3 years ago to start my own business. I have alot of the same questions and feelings that rrrusty does. I feel that my quality is right up there with the big boys, and trying to train someone else would just stress me out, and I'd wind up doing it myself anyways. So I'm a one man show(literally sometimes)and happy about it, I do occasionally hire a helper. I do at times wonder about the prices I charge, I am also 24/7 and charge $40.00 for the first hour and $20.00 there after. Is that out of line cheap or expensive? I also know that my $ will not grow unless I decide to grow by hiring more employees, but it all seems like more headaches, and more money until you get large. So I'm complacent. A few of you made some very good points, that I am going to take to heart. I guess that I have not really thought of my time as that valuable. Do those of you that own your own business have a web site and yellow page adds?
 
Re: More $$$ ???

IMO your rates are way to low.
If you take the journeyman rate in your area and add the following expenses: $5 or $6 for your truck, cost of benefits comparable to what you had, work comp, insurance, advertising, telephone, cell phone, etc. and after that think about what your time is worth for your unbillable time, such as estimating and billing. When you add all this up you will be way above $20.

Some people think that if you are a small contractor, you can be more competitive because of lower overhead. This is not true, your overhead as a percentage or per man will be higher than large contractors.
 
Re: More $$$ ???

"quit the ibew 3 years ago to start my own business"....My tax advisor told me when I started out it would not be uncommon to "lose" money the first couple of years! Once I got the hang of things, I knew what to charge and how much money I needed (not wanted) to make! The third year was prosperous and I am now getting closer to the money I (want) to make! Since this is your third year, way the pros and cons as to what you need and what you want and charge accordingly! btw....this is the start of my 12th year in residental....big house, corvette, you get the picture!!!
 
Re: More $$$ ???

Luke:

In my business 24 hours means a call back with in 30 minutes, and a determination made as to whether this call demands someone at what ever time.
In a true emergency we are usally on site with in 2 hours, depending on location. Hospitals, data centers, communication companies, take priority then, it is down hill from there.

As for rates minimum 4 hours double time of our hourly rate. The hourly rate depends on what type of tech is sent. This is not gouging, customers are aware of rates before we move and usally need the service more than they need a few dollars.
 
Re: More $$$ ???

Genuine after-hours 7X24 emergency service in a commercial/industrial setting can command serious $$$, and those customers won't choke at paying it the way residential would.

Back when I was doing computer consulting after I left IBM, I spent a couple of years at a firm that was billing me out to clients at $250/hr (I never saw that much :D Yet, knowing it isn't going to be cheap, they still picked up the phone because they determined it can't wait.

$100-200/hr doesn't seem unreasonable to me for genuine commercial emergency service during off hours. You'll need a lot more on hand stock than I did traveling with just a laptop and a pack of CD's :p I'd run the clock on a portal-to-portal basis too unless the client just around the corner 5 minutes away. If you have to drive say an hour and a half one way to get somewhere at 3:00am, find/fix the problem in 15 or 20 minutes, you sure ain't gonna hand that client a bill for only $50 for the time you spent on site.
 
Re: More $$$ ???

If they were about to lose thousands of dollars of lets say frozen food.Your bill for $500 would be easy to swallow.Once got a 911 call from a greenhouse.The fans had shut down and they stood to lose every thing in a matter of hours .They were lucky in that it was daytime on a wed.Was no need to gouge them in this case.Had it been 3 am on a sunday i believe $500 would be well in line.
Should this be a homeowner they might try to live with out electric till morning.How much value will a worker be the rest of the day if he only had 2 or 3 hours sleep.Would only be fare to pay him for 8 and send him home.
 
Re: More $$$ ???

brian john,
I'm sure that's why you started your other post with 'we are a true ...
While I'll agree that you in essence are a ' true ' 24/7 service company, I would imagine that you convey that message to your customers and in any ads that you put out.
Therefore, I stand firm that a 'standard' 24/7 company without a clause is one that responds to calls within 24 hours, not 'give us a call anytime'. And that company probably would respond to an emergency, but not for a normal rate.

I own a very successful company. We do not advertise on the web, or in the yellow pages. We tested it out and found it to be a waste of money for us.
 
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