Calculating overhead – Secrets of knowing what hourly rate to charge for your work.
Let me ask you a question. What hourly rate should I price my work at?
Or, What is the going rate for painting work?
I wish I had $5.00 for every time I have heard someone ask that question of another painter.
So what?
Here are two more examples of “so what”.
1 – I am a 35 year old married man with 3 kids, a big mortgage, and my wife is a stay at home mom. I pay all my medical expenses out of pocket. I have two painters and two tucks with all their bills and expenses. I pay for workers comp and liability insurance on our combined payroll. And of course if I get hurt my government won’t allow me to collect disability; because, I am the owner.
2 – I am a 45 year old man living with my wife who is tenured teacher in a big upper class public school. Her job pays all medical expenses and insurance. We bought our home 20 years ago, and the mortgage is small for today’s standards. We are childless and have no major expenses.
Different needs, both business and personal, so what do they charge?
The “going rate”, or whatever that is. The problem with selling our services for the “going rate” is that the “going rate” is someone else’s rate, not your rate. So to ask anyone what the “going rate” is a sure fire way to work for an hourly rate lower than you need.
You should ask yourself what your “going rate” is. That is, what do you need to sell your jobs at in order to do the best job you are capable of and make what you need plus profit. The way to know is to add all your costs including what you need to earn and diving that by the amount of hours worked.
Just add all your costs, for the year and divide by your historical hours worked. That will be your “going rate” not some number thrown out in order to be the lowest bidder. And that is usually what someone else’s going rate is.
The problem with most people in our business when calculating overhead is not including everything.
For example, do you pay yourself to do an estimate? We all advertise “free estimates”, they may be free to our clients; but, they are not free to us. Leaving out things like this will give you a lower number than what is needed. And the greatest challenge of painter/craftsman/ business owner is to learn to think like a businessman before thinking of himself as a painter.
By: P E Cavanaugh
Posts Tagged ‘Insurance’
Painting Jobs – Going Rate, Hourly Rate Or Selling Price
March 9th, 2010How to Hire a Painting Contractor
November 21st, 2009
Painting your home all by yourself isn’t a good idea any longer- there are too many improvisations that need to be carried out before you can actually begin your job. So hiring a professional painting contractor is a better choice as your job will be done on time and with less effort on your part as well. Also hiring a painting contractor would also save you time and energy, which is very essential as well. But before choosing one, you must look into certain details which are a must. Consider the following points noted below while you are in a quest to choose the best painting contractor for your house-
Look for Efficient and Professional Painters: You must not be hasty while choosing a painting contractor; browse through the net, look into the yellow pages, ask friends for references and try to shortlist some of the best known painting contractors in town. Also, don’t forget to learn about their years of experience in the field and their turnover rate.
Get The Details of The Employees: You need to know about the employees of the prospective companies you are considering – their experience, their skills and their training process must be clearly narrated to you. That’s the USP of any good contractor.
The Preparation: Get the details of the preparation work that needs to be done before actually implementing the whole thing. A good painting contractor will help you out with the colors and the areas to be painted; time shouldn’t be a constraint in these cases and you must know how long the whole project would take. If the painter asks for more time, try to understand whether he has any justified reason or not. An experienced contractor would take some time I suppose, but would deliver the finest work, which is worth the time spent.
Employee Insurance Is a Must: Yes, that’s true. You should look for reputed companies having insurance for their employees, which is very critical. A licensed contractor would always ensure his employee’s safety.
Ask For Reference List: This is a must as it will help you in understanding the status of the considered painting contractor. Call up the references and verify the details.
Ask For Recommendations: A superior painting contractor would have all the latest updates on the kind of products and materials being used recently for painting. Ask their suggestions for painting materials, techniques and color schemes based on the area of your home that needs to be painted. If the painting contractor is truly experienced, you’ll definitely get some great tips.
Ask for a written agreement: Yes, a reputed contractor in the business would have all the necessary details in writing for your convenience.
The Maintenance Program: Some contractors do offer maintenance programs, so it’s better to ask, though it’s not mandatory.
The Charges: Its not that expensive contractors are the best in the business, some contractors with competitive rates can have great services to offer. But of course, if you want all the above mentioned specifications in your painting contractor, he’ll not be cheap. You’ll have to spend a bit more than usual to hire a painting contractor like this and it’s truly worth the dollars spent.
By: Sanjana Antony
