Has anyone actually done a study on overhead for 1-4 man shops compared to 20-30 man shops?
I ask because they will go after some of the same market, so there are similiarities there.
But I'd venture to guess that the larger shop probably has a lower amount of overhead per man hour than the smaller shop.
what I mean is this, take out all labor cost (including burden) and compare overhead costs on a man hour basis, my gut feeling is that the larger shop will be lower.
This is simply because the overhead is spreadout better over more man hours.
For the record, I don't know the answer. What does everyone else think?
I ask because they will go after some of the same market, so there are similiarities there.
But I'd venture to guess that the larger shop probably has a lower amount of overhead per man hour than the smaller shop.
what I mean is this, take out all labor cost (including burden) and compare overhead costs on a man hour basis, my gut feeling is that the larger shop will be lower.
This is simply because the overhead is spreadout better over more man hours.
For the record, I don't know the answer. What does everyone else think?