Time And Material (T&M)

gal

I am the owner of a business looking for information on billing for time and material. The job consist of several homes that are to be restored in Louisiana due to hurricane damage. How do I charge for T&M on these homes? How much do I mark up my labor, workers, covered truck with tools, pick-up truck, etc. I have a crew of 4 experienced craftsmen and all the tools to build a house. I will be required to carry worker's comp and general liability insurance, so the cost of insurance must be covered completely by T&M.

MinConst

Wouldn't you figure this just like you would figure a project in you normal place of business?

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Minichillo's Construction
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gal

All other jobs were awarded by a bidding process.

Gordo

Use the hourly labor wage that you used during your bid process.

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Looks like some pros were here.

welovepainting

check out www.yourcostcenter.com they have a great sytem to determine your operating cost per hour then all you need to do is add profit and material.

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GregS

So how much does your "labor, workers, covered truck with tools, pick-up truck, etc" cost you? Don't forget everything else like phones, gas, food, insurance...

Figure that out and add enough markup to stay in business. Otherwise you will be going out of business.

house bldr

I usually charge double what I pay my guys plus mileage

skyhook

That's the old formula. Now it's triple or more if you want to be in business next year.

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Runamuk

I'll check it out(for grins) but I seriously doubt they cover the F factors.

I'd figure your time accordingly and add a pad of $500-$1000 for the F factor in each. It will give you almost a day depending on damage done.

Rick

TNGHomes

I use the Magic Number formula, granted sometimes I have to tweak it a bit to win certain bids however:
*figure what you want to make a year
*divide it by how many weeks a yr you want to work
*then figure out you overhead and cost for help and
double it.

Some Goverment bids want you to lock in for X-amount of yearly increments if so be sure to leave more budget room for expanding your company, and material and gas price increases accross the contract duration.

TNGHomes

P.S. why is it that you dont seem to typically carry insurance on you and your guys, it almost sounds like it is the first time your considering carring insurance.

MarkNoV

Time and Material pricing.

Time component - expressed as rate per direct labor hour, computed as follows:

- direct cost of employee including salary and fringe benefits
-a pro rata allowance for selling and admin. expense.
-allowance for desired profit per hour of employee time.

Material component-is determined by adding a material loading charge to the invoice price of any material used on the job. It must cover the cost of ordering, handling,and carrying material in stock, plus a profit margin on the materials themselves.

Mark

gal

Went from 16 years as an employee in construction, to owner. We are just starting out. I know how the "bid" jobs work, but have never done a "T&M" job. What kind of prices do I charge for the vehicles and tools?

Gordo

Your in trouble my friend. Only you can figure that out.

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Looks like some pros were here.

MarkNoV

What did the vehicles cost?
Are they paid off? If not how much interest are you paying?
License cost?
Insurance cost?

How much did the tools cost?
Are they capitalized or expensed?

How many in each crew? are they employees or subs?
How much do you pay them per hour?
What are the additional salary burdens, taxes, comp etc.?

How will you pay for the materials?
If using your money to buy material what is the cost of your capital?
What is the probability that you will not get paid?
Will you store the material in your own warehouse or will they be delivered?

Did you print business cards, invoices ,PO's,
How much did they cost?
How much do you pay for the phone, internet , computers?

DO YOU HAVE AN ACCOUNTANT?

Mark

gal

What did the vehicles cost? 2 trucks - $40,000
Are they paid off? yes
License cost? $50.00 annually
Insurance cost? $5,000 annually (both trucks)

How much did the tools cost? approx $10,000 (paid in full)

How many in each crew? five
are they employees or subs? employees
How much do you pay them per hour?
1 carpenter $24.00/hr, 2 helpers $12.00/hr,
1 painter/sheetrocker $20.00/hr, 1 supervisor $35.00

How will you pay for the materials? My money (adding 20%)
What is the probability that you will not get paid? 1%
Will you store the material in your own warehouse or will they be delivered?
Materials stored on jobsite and in my covered truck


How much do you pay for the phone, internet , computers?
$1500.00 annually

DO YOU HAVE AN ACCOUNTANT? not yet

mahlere

Then why even quote? or was that a misprint and it should be 99% probability that you will get paid?

skyhook

My wife of 7 years has a saying when ever I tell her how much it will cost or how long it will take. Her saying "Times Three" has helped me over and over. Especially when it comes time to pay Uncle Sam.

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gal

Sorry should have been 1%. Edit done.

jiggyjack

Pay your guys $7.50 an hour and just guess on materials.



GOOD LORD how can you say you are in the trade and not have some idea how to figure this?!

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