Herk is smart.
Nice, clear explanation there about service contracting.
Well then. I guess we're all a bunch of crooks.
Last edited by westcoastplumber; 06-03-2009 at 11:19 PM.
This happened to me the other day at McDonald's. I wanted a mocha instead of a soft drink, and they didn't discount the meal. No - that's not fair at all. But that's different than an onion or some pickles.Originally Posted by Trent2
At Wendy's, I found that if I want a single and a salad with water, it's a lot cheaper ala carte than buying a meal.
And in flat rate, I make more money if I do more jobs at one time. But there are times that I have to be good at making it up as I go along. It's not possible to have a task for everything. The trick is to make it all come out to a reasonable amount. And the amount I'm getting is usually considerably more than what I got when I was using T&M. There are times when it's actually less, but again, you have to make the prices somewhere that the client won't fall over in a faint.
I hardly ever quote an hourly rate. I'm not a yardman someone is hiring to rake leaves or dally around the house all day. The flat raters are right about that. Whoever named it "labor" should be shot. People have in their mind the the labor rate is what I'm taking home (I wish!)
If someone asks my hourly rate I ask them what they need done. I tell them what that job normally costs. Theirs may be cheaper or higher but I can usually make that determination on the front end.
I believe most people know it isn't cheap to stock a truck and have a legal business model but are also ignorant as to what those costs are. In my experience, they usually only want a general idea of what a certain job or jobs will cost them so they won't be surprised by a $500 difference.
Oh, and I'd recommend if you do invoice your customers through the mail like I must do most of the time that you never itemize your labor and material costs. (I list every part but I don't price them). A final figure is all they need. Otherwise, their imagination will run away with them.
"Man will do many things to get himself loved, he will do all things to get himself envied." Mark Twain
I do both Bid and T&M jobs. If it's new or replacement it's a bid. If it's a funky fix or big unknown it's T&M (typically with estimate). If the customer still insists on bid for something I can't be sure of how long it'll take to fix, then they get a real high bid. I explain this and sometimes lose jobs because of it but that's how I cover my butt and make sure I make at least a decent hourly wage. Below a certain hourly wage I'm better off working on my own house.
I only have one speed either T&M or Bid: work hard and get it done right. T&M has a real bad rap because guys think they can milk the clock and use it as a training ground for green guys. That sucks for the guys just trying to hold a decent wage and do good work. Way it is.
For blind fix it calls I'm 2 hour minimum at $75/hour plus one way drive time. Same for T&M. Material is at cost but I'm on the clock going to the store. I won't mark it up if I'm paid to go get it. Remember, I work just as hard as bid anyways so I'm in and out just the same. Just getting a check and feeding the family. Billing is done by time sheet and reciepts. Time sheet shows days, location, time in and out, and tasks performed (list of 5) and receipts are attached. That's it. Thank you Mr. Customer it's payday.
Bids are just down payment, progress payment for balance of material as it arrives, and final payment on completion. I must say that bids are more lucrative in that I get way better material markups and can get ahead. I even bonus for early completion to my guys if they really kick ***. Work hard get paid more. Keeps them happy.
Anyways that system keeps me busy and keeps the mortgage paid. Still a work in progress though as I've only been running the show here for about 6 years.