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  • #16
    Re: Is $280 to $340 The Correct Hourly Price

    Maybe cutting back some on employees and keeping the rest of them busier would help.

    Possibly buying a truck coming off of a lease program and running it for a few more years would cut some vehicle cost,

    IF your reputation and pricing encourages repeat business, then maybe one would not have to spend as much on advertising to be seeking out new customers,

    bestline3
    Truth is customers don't know the right price and they are not loyal.
    but they sure feel they know when there being ripped off,
    Push sticks/blocks Save Fingers
    ~~~~~~~~~~~~~~~~~~~
    "The true measure of a man is how he treats someone who can do him absolutely no good."
    attributed to Samuel Johnson
    ~~~~~~~~~~~~~~~~~~~
    PUBLIC NOTICE: Due to recent budget cuts, the rising cost of electricity, gas, and oil...plus the current state of the economy............the light at the end of the tunnel, has been turned off.

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    • #17
      Re: Is $280 to $340 The Correct Hourly Price

      leonard, is every customer you work for uninformed? do they not get a couple of estimates. do you not have to bid on work? do you only work for desperate housewives? do you do work for management co's.

      it really sounds like it's buyer beware, as what they don't know, you can walk all over them.

      with the amount of flyer's you pass out, with your own guys, tells me that you have to keep finding new uninformed desperate housewives to keep your game going.

      with only 8 guys who do plumbing, how hard is it to keep them busy all over the 30 plus mile radius you pass them out?

      the more people that find out about your game, the farther you have to travel to find desperate housewives.

      just the opposite of my work. the more that find out about me, the less i have to travel. a tank of gas/ 160 miles last me almost 2 weeks.

      i guess gardena is well informed now, as your website list dozens and dozens of communities that you work. 8 plumbers and dozens of cities and communities. last count of 54 cities and communities. last time i checked bathroom remodeling, kitchen remodeling and hydro jetting are not cities. maybe city girl is padding the books for the boss

      so far you $280- 340 doesn't sit too well with the pros here.

      rick.
      phoebe it is

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      • #18
        Re: Why the 4 hours per day

        Originally posted by bestline3 View Post
        Reasons why we can bill only 4 hours per day.

        A few days ago, 3 of my crews started the day with 13 calls ad 7 am in the morning. We pulled out the driveway, called our customers at their scheduled times and about 8 of the customers did not answer. This was unusual, but it happens.

        Another reason is, we take the time to travel to a home and we don't get to charge the customer for many reasons.
        I would think that if you have 8 trucks, you should be able to have one guy do the calls that are close to each other and have pretty minimal travel time between jobs.

        Also if you need $300 for an hour, and your plumber makes $37; wouldn't it make some sense to have these guys work 10 hour days instead of 8 since most of your other expenses are fixed and just pay them overtime.

        Also, it sounds like you need one guy with flyers for every plumbing crew and you blame it on people moving. How often do people move, maybe pretty often; but probably not usually to a very different area. I would also think that people who pay for plumbers move less often, because they own the property (or their landlord would be paying for the plumber not them).

        I think some of your posts make great points, like you identified that flood restoration was a big pile of money that you were passing on; and now you can make money on that instead of someone else doing it.

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        • #19
          Re: Is $280 to $340 The Correct Hourly Price

          Sounds to me that the bigger you are, the more you have to charge, that's all.


          Down to the little guy who's a one/two/three man show, the pricing is more realistic to the margins needed to be profitable.


          Now if I was in LA and every time I had to drive on the expressway and it took 1-3 hours to get there? Better believe that the cost per hour would go up, considerably.


          I'm charging $85/hour now for services, $75 for regular customers I've had through the years and I've brought them from $65/hour which was a useless wage in trying to be profitable.

          I'm talented on the phone by peering into situations before I get "had" from price shoppers.


          For example,

          Guy called while I was finishing up on a drain call today and asked how much I'd charge to replace a closet flange. After asking pointed questions back I was able to get out of him that he had two plumbers out there looking at a freaking toilet flange.............?!!!


          As soon as I heard this I told him I couldn't get to him for a week, call somebody else and instantly hung up on him.


          I feel sorry for the two idiot plumbers that got their time wasted, their fuel, just for some bloomin idiot to find best price on a toilet.


          I don't need this type of customer base and I'll take my 4 minute phone call on a cell phone while I was being paid on another call......my only contribution to the ignorance.
          Northern Kentucky Plumbers Twitter Feed | Plumbing Videos

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          • #20
            Re: Is $280 to $340 The Correct Hourly Price

            There was an article in the cleaner about a company from NYC, "49.99 any drain" was their name. It sounds like they had much same concepts you have. Use drain cleaning to get your way in the door and then markup other services. They also marketed very heavily. For a new business getting off the ground, advertising is needed to get your name out there. Your advertising budget should go down as your business grows. This didn't happen in your case. I'm curious as to why.

            I used to work for a company about your size and netted 4 mil the last year I worked there. They were a commisioned based company and were notorious for ripping off customers(5g's for a 50 gal W/H). The way they made money was they spent 50g's per month in advertising to get the next victim.

            I'm not saying you do this but there are unsettling similarities between the 2 companies that I don't care for. Unfortunantly, I'm starting to see a lot of holes in your business practice.
            Buy cheap, buy twice.

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            • #21
              Re: Is $280 to $340 The Correct Hourly Price

              Leonard,

              You and I have both been at this for better than 30-years. Since you have been so kind as to share your business model with us I thought I would offer you some free advice back to you.

              The first thing I would do is consider firing your entire crew and office staff and starting over with a crew and office staff which can give you better than 1000-hours per plumber per year. My shop was closer to 1900-hours per plumber per year but anything close to 1700-hours per plumber per year would be a start. Because your hourly rate is based on annual hours per plumber the additional hours per plumber will reduce your burden by at least 35%.

              Secondly you need to factor in the profit you make on materials. Using your numbers you have $1,760,000 in annual material sales. Assuming you have a modest makeup of 30% on materials you should be making north of $500,000 in profits just on your materials.

              The third item is your advertising. After 30-years of doing this your phones should be ringing on their own. $5,000 per month is entirely too much money to spend for advertising in an 8-man shop.

              The last thing for now, as I am on a lunch break and need to get back, is I would reconsider how much you are paying City Girl. I know she shares the same last name as you so she is likely a relative of some type. However, with her $11,000,000 in net worth and her 121 homes is it possible she is over qualified for her position?

              Mark
              Last edited by ToUtahNow; 07-07-2008, 07:36 PM.
              "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

              I never lost a cent on the jobs I didn't get!

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              • #22
                Re: Is $280 to $340 The Correct Hourly Price

                I only figure for four billable hours/day also. I am flatrate, and my system is based on the time of actual work, not drive time, etc. And as a one-man shop I do the book-keeping, answer the phones, stock the inventory, handle the marketing, clean the truck, etc, etc. So 4 hours billable is normal for me. (also I work a much larger territory than Plumber rick for example, so I have a lot more drive time between jobs)
                However, if I had employees I would have to figure a little more time per day for them to produce, because as plumber employees, their sole job is to sell the work and do the work. They would not have to handle the phones, the book-keeping, marketing, etc. I would be dispatching them as quickly and efficiently as possible from job to job and I would expect a 6 hour billable day on average from them over a month of time or they are fired (if they want decent pay like the $1500/week example, it requires an efficient work ethic.)

                So I think figuring to pay your guys 1500/week based on 4 hours/day is a bit inefficient. Also like Mark said (toutah) above, it sounds like you are spending money inefficiently in your business and then acting like its normal and passing the expense on to your customers.

                You are good at job-costing and book-keeping obviously, but to sum up your problem in one sentence your business model is lacking in management efficiency. Just my 2 cents, I am just running a small start-up company, so take my advice with a grain of salt.
                Last edited by Service Guy; 07-07-2008, 04:00 PM.
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                • #23
                  Re: Is $280 to $340 The Correct Hourly Price

                  Originally posted by DUNBAR View Post
                  I'm talented on the phone by peering into situations before I get "had" from price shoppers.


                  For example,

                  Guy called while I was finishing up on a drain call today and asked how much I'd charge to replace a closet flange. After asking pointed questions back I was able to get out of him that he had two plumbers out there looking at a freaking toilet flange.............?!!!


                  As soon as I heard this I told him I couldn't get to him for a week, call somebody else and instantly hung up on him.


                  I feel sorry for the two idiot plumbers that got their time wasted, their fuel, just for some bloomin idiot to find best price on a toilet.


                  I don't need this type of customer base and I'll take my 4 minute phone call on a cell phone while I was being paid on another call......my only contribution to the ignorance.
                  I need to get better at the 'phone game', it sounds like you got it down to a science Dunbar! I hate people like that that get multiple free estimates just for a small job, its why I hate to do any free estimate. I usually charge a small service fee ($40-50) just to show up on any call. If they don't like it, its usually because they are looking for the low-baller in town, and that not me.
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                  • #24
                    Re: Is $280 to $340 The Correct Hourly Price

                    Also, I vote this thread gets moved to the business discussion section.
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                    • #25
                      Re: Is $280 to $340 The Correct Hourly Price

                      Originally posted by Rafael View Post
                      If your employees make $1500 per week and you need to bill at least $280 per hour then something is wrong.
                      On a related side note. I needed a toilet replaced. I called a few places out of the phone book. 2 would give me estimates on the phone assuming that there was nothing unusual or unexpected. Both wanted about $800 to do the job, including the toilet. They gave me 2 options on the toilet they had. I priced the toilet itself and it would cost me about $200. So they wanted $600 to install a toilet. IMO, only a fool would pay $600 for what was a simple install. I bought a new toilet myself and I got a referral to a licensed plumber from my neighbor. He charged me $200. It took him less than 1/2 hour to do the job including unpacking the new toilet and cleaning up after he was done.
                      Who do you think will have my business from now on? The thieves from the yellow pages or the plumber who doesn't advertise but get referrals from happy customers?
                      To call someone a thief because a company wanted to charge you $800 to supply and install a toilet is unfair. you have to go to the supply house pick up the toilet and hardware remove the old, install the new one and dispose of it plus you have to factor other things into it. I charge $700 if I supply it $300 if I just install it.

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                      • #26
                        Re: Why the 4 hours per day

                        Originally posted by cpw View Post
                        I would think that if you have 8 trucks, you should be able to have one guy do the calls that are close to each other and have pretty minimal travel time between jobs.

                        Also if you need $300 for an hour, and your plumber makes $37; wouldn't it make some sense to have these guys work 10 hour days instead of 8 since most of your other expenses are fixed and just pay them overtime.

                        Also, it sounds like you need one guy with flyers for every plumbing crew and you blame it on people moving. How often do people move, maybe pretty often; but probably not usually to a very different area. I would also think that people who pay for plumbers move less often, because they own the property (or their landlord would be paying for the plumber not them).

                        I think some of your posts make great points, like you identified that flood restoration was a big pile of money that you were passing on; and now you can make money on that instead of someone else doing it.
                        You cant have only certain guys in certain areas. It doesnt work, at least most of the time. The last company I worked for as a service manager, we did plumbing heating and air. Certain guys couldnt do certain jobs, we had journeymen that could only replace faucets and clean drains and some guys couldnt do renovations and certain guys that could do heat but not a/c and vice versa. So for the most part this wont work.

                        Dont forget 300/hr for bestline is not every hour it's only the billable hours and if he covers a large area he has alot of travel time.

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                        • #27
                          Re: Is $280 to $340 The Correct Hourly Price

                          Originally posted by Masterplumb View Post
                          To call someone a thief because a company wanted to charge you $800 to supply and install a toilet is unfair. you have to go to the supply house pick up the toilet and hardware remove the old, install the new one and dispose of it plus you have to factor other things into it. I charge $700 if I supply it $300 if I just install it.
                          I hear you on that. I have many choices and prices.

                          Customer-supplied toilet: $175.
                          Round wellworth: $371
                          elongated wellworth: 413
                          ADA height: $455

                          elongated Cimmaron: $486
                          ADA cimmaron: $599

                          elongated pressure-assisted gerber (for the people who require a super-flush):$699
                          ADA height pressure-assist gerber: $799

                          Of course I am in a much more rural economy also than many guys. If I still lived on Long Island, New York these prices would be MUCH, MUCH higher.
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                          • #28
                            Re: Is $280 to $340 The Correct Hourly Price

                            i will place a $ down that this is going to be one of those threads that go no ware and keep going and going and going
                            Charlie

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                            • #29
                              Re: Is $280 to $340 The Correct Hourly Price

                              Originally posted by HVAC HAWK View Post
                              i will place a $ down that this is going to be one of those threads that go no ware and keep going and going and going
                              Charlie, that's scary, I was thinking the same thing, back away from the computer and go buy a lotto ticket.
                              Buy cheap, buy twice.

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                              • #30
                                Re: Is $280 to $340 The Correct Hourly Price

                                Originally posted by HVAC HAWK View Post
                                i will place a $ down that this is going to be one of those threads that go no ware and keep going and going and going
                                Those are my favorite threads! The short threads are short because the topics are boring.
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