Example Of Cost/profit

needham

hey guys! I really dont understand how yall guys really make money, so if you could fill out this example it would solve many of issuses and questions. OK.. you have a 20x15 room with 9 foot ceilings.3 doors and 3inch baseboards, 2 windows. you bid at $45 an hour.you are painting walls only.BUT how much extra would it be for trim? please bid this room at what YOU WOULD BID . please break cost down like this TOTAL .....LABOR(including number of guys).....PAINT COST.......WHAT IS LEFT FOR PROFIT/OVERHEAD...I Know if a couple of you really good guys could do this ONE example for me it would solve MOST of my questions and negate the need for MANY more post by me!!you guys are awesome!! THANKYOU

KENNEDY

How can you know how long it takes to paint the walls, but not know your production rate on any other surfaces in the room? If your rate is $45 per hour (where did you get that # from anyway) you should be able to figure your time on the other areas and attach that number to your manhours for a price.

__________________
Sean Kennedy
St. Louis Painting Contractor
Kennedy Painting LLC

boman47k

the last couple of jobs I did for the other man, I kept a half*** record of the time each step took. I really wish I had done like one complete room instead of maybe running running trim in several rooms before going to the next step such as rolling, cutting in, etc.. Can be kind an eye opener to see how much faster things can go when you set your mind on it.
I don't really mean busting ass to see how fast things can be done but just a good steady flow of uninterupted work.
Just as importantly, if not more so, it can also be an eye opener on how long something can take to accomplish. An example would be rolling a textured ceiling in one direction.

needham

I guess noone gives out bids on fridays

Danahy

Sounds like this could easily be done in one day, however two light days would be better, for me anyhow.

Overhead = What does it take to run your business per month? (30 hrs per week (low in case you end up with errands, or sick days) times 4 so the magic number here is 120... (remember that for later)...

Let's say with ads, and gas, and vehicles, and tools, and supplies, and phones and everything else costs you (example) 1000 / month. Divide 1000 by your magic number 120, you get about $8.34 / hr you need to charge for overhead costs.

How much profit would you like to make? For things like incidentals, or re-investment back into the company for growth etc... Lets say for fun, you'd like 500 / month. Divide 500 by your magic number of 120 you get $4.17 / hr.

So far Profit and Overhead are now $8.34 + $4.17 / hr, which is totalled at $12.51 / hr.

What would you like to make per hour? Going rate might be anywhere between $20 - $60, depending on your market, how good you are, etc... Lets say for fun you'd like $30...

Take your $30 add your P/O and you get $42.51 / hr that you should charge per hour.

If this is your number you can now look at it in two ways... Bill them by the hour, which gets you what you want, but leaves the customer holding the bag for trusting you part, or give it an estimate using the usual methods you use to come up with? Room like that sounds like a living room, and let's say your living room price to do 2 coats on the walls was like $350 (labour only)... Divide $350 by your hourly rate of $42.51 you get 8.2 man hours... Which means you can do this job over 2 days provided you are headed directly to your next job long before lunch, or you just hang in there, and complete it in one day to make sure you hit your quota.

Hope this helps (remember these are fictional numbers only, replace with your own real numbers to see really what you need).

needham

i dont want FICTIONAL NUMBERS !! i WANT REAL NUMBERS from real painters. I dont understand why people just will not answer the question and break it down to labor,,,mats,,,whatis left.

everyone wants to say .."you need to know ***" NO i dont cause thats not what I asked for.

Sorry for the rant ....... I just dont know why people type a long explainations of reasons they cant/wont answer instead of answering the question!

thanks guys

slickshift

Kennedy and boman answered your question

No one can tell you your production numbers
You need to know what your production rates are
No one can tell you what your expenses are, what your overhead is

You may need to guess at some if you are just starting out
But they would be doing you no favors by giving you their numbers

That's like saying I want to build and sell computers
I don't know how long it will take me, what my labor costs are, what my overhead is, and what I'm going to charge
OK, I'll just take Dell Computer's numbers and go by them

Danahy's formula should work pretty well to get you close to what you need for hourly
But you'll have to fill in your figures
If you don't know, estimate and adjust later
You can't start a business w/o a plan

Now you need to know what you can do in an hour
You should have all basic production rates written down
You really can't build a paint business without them
If you've been painting for a while, you probably know a lot already
Just put it in writing and use it

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Quote:

Originally Posted by ModernStyle I have never used this crap before and I pray to the paint gods that I never have to use it again, I would rather use Behr

George Z

Also, do not forget the owner's salary.
The owner's salary must be part of the overhead,
and is not the same as wages paid for completing a job.

Even if you are a one person operation, pay yourself some salary
for running the business, and hourly for working in the field.
It may look like it is the same money anyway, but it isn't.
When it's time to replace yourself in the field, you know how much it costs.
When it's time to have a great salary, you know what to charge.

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Double-A

I'll paint it for $10,000.00. But, you only have to pay me 10 bucks an hour. See, I'm gonna show up stoned, and burn a bowl or six while I do this job, take a look through the house and snag what I can for my habit, take a few things cause I just feel like it, and then not answer my phone for the next two weeks while I stay sprung. BTW, I also plan to "fall" off my ladder and sue you/your WC carrier for the bill, cause, I forgot to get a certificate/lied to you about my WC coverage.

The check you write to me might be a cheap one, but the checks you write to your insurance co., the home owners, your WC folks, etc., etc.

You are getting your answers. You just don't like them. You want someone to tell you what they charge, but maybe they are hiring folks like me, in the above example. Maybe they are me in the above example. Or maybe they hire and pay only pros, carry WC insurance, demand current insurance proof on every single job from their subs, etc., etc.

Without knowing your prevailing wage for interior journeymen painters in your area, your WC rating, your insurance coverage limits/costs, there is no way anyone can start to answer these questions.

Know your numbers or find out. Anyone that is in the dark on this should start looking for a real job, because what they have now is just a hobby waiting to become a lawsuit or a bankruptcy proceeding.

__________________
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New York Times, July 20, 2006

boman47k

Mind if I ask your age?

Joewho

Not everyone here does charge all that you are asking about. Only the ones that do would be able to answer you truthfully. I envy those guys cuz they have the really good customers willing to pay.

Personally, I stay away from having employees because workmans comp costs too much. You need to have a really big company to support 25 or 30% of your gross? Then if you want a profit...pick your number. 20%? It goes on, and sorry it's not a straight answer. You have to take the BS factor into account too.

Start with labor, your labor is 45/hr.

Overhead is a big question to answer.
What is YOUR overhead? Add it all up and divide it down to a day and a half. That includes a day and a half of insurance, vehicle depreciation. etc.

materieals broken down to 150 for paint and 50 for sundries. Brushes, drops etc. are all part of overhead and profit.

Profit @25% of total job.

A day and a half of labor = 540
Add a day of overhead ?? = 75
Materials = 200
Profit = 180

Total 995.00

This is just my straight answer, some of the other guys with bigger operations can probably work it out better.
But, yeah, that's a lot of money to paint a room. For me, I'd cut my labor cost to 35/hr. and profit down to 20 or even 15%, to stay competitive and not worry about someone calling me a cutthroat. It's an open market, as long as you pay taxes and insurance, do what you gotta do. The goal it to get to the point of charging top dollar, but most don't start there.

needham

I understand what all of you are saying. I would NEVER answer the above question like what yall do. I want to know how others are breaking it down and charging. I WANT to use people that I respect (YOU GUYS) as a model then tweak it to my own tailored needs. I totally understand that I need to grasp my own numbers. But for this example I have asked for YOUR numbers, I dont care what region of the country you are in, or what your market is, I just want to know YOUR numbers as a BASE, or home point, so I know that in GENERAL my methods are not totally out of whack and I have a starting point to tweak my own numbers and business practices. Also this would help everyone by knowing in AVERAGES what people are doing, so we dont leave money on the table. I really didnt think it would be that hard, since all of yall are pros.

needham

JOE THANKS ...........the entire post was good but the NUMBERS are EXACTLY what I wanted. I wish I could get a few more straight shooters like that, and I would really have a good base to tweak. THANKS AGAIN JOE

Cat_painter

Thank you danahy I have been racking my brain trying to figure out how to come up with my numbers now I know Thanks

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Joewho

Ditto to Danahay.

needham

yes Danahay's was chaulked full of info for the long haul.

GoodPainter

Needham,

I'm a newer guy i the biz. It has been only 1 year since I had
the dream and vision. A little under 6 months since my first contract
signing.

I have learned alot and by my own experience and trials. I started wondering what the H*LL am I going to charge? Well started with the
"$30/hr"+mat+profit+error+etc rate and has worked but that price just
seems
like I am getting ripped off. So i decided to jump it up a bit.

This new year comes a lot of new beginnings for me and my family.

And my biz...

I will be estimating my time(and biz time) at $40-$60+/hour depending
on job (i.e. difficulty), adding in 10%+ for error, Adding Material costs,
20%+ profit, and adding in OH (per job actual costs + markup and misc
charges)?this is hard to explain and understand but I dont have a OH
calculation worked out since I add OH all the time, i.e. will be getting
Health Ins, incorporating, WC, hiring Employees, getting licences, expanding into
different works, getting a new van, getting many new vans, getting a
building/garage, etc. the list goes on and on.


So If its just you yourself with no many expenses YET---they will come!
Then just do the $30 to start and Avg $500 room+mat and see what your speed time and skill levels are and go frome there.

If you are thinking about quiting your job and supporting your
family with painting, for sure dont quit but paint on the side till you got
your biz worked out and can get a little experience with the numbers.

__________________
Robert Good
It's Your Life-Make Fun Of It!
http://www.robertgoodpainting.com

premierpainter

NEEDHAM

Here is how my estimate would read:

Dear Homeowner,
Seeing that I have no clue what I am doing I am going to charge you the following:

Labor: About $7000, give or take a few thousand
Materials: About $20 because I shop at Home Depot
Other costs: About $1000 because I think that I need to profit
Grand Total: $8020
As our motto states, Here at No Clue Painting we strive to ask all painters what they will charge, then twist the numbers to some magical number and come up with a quote. I know this Estimate sounds expensive, but remember, I have no clue about estimating and the guys on the board will not give me direct numbers.

Thank you and look forward to ripping you off soon,
Kevin

boman47k

Not an attempt at hijacking the thread, but what are you calling an average sized room?

GoodPainter

Thats the whole idea....

He has to find his own Average room with his own labor costs and OH.

From there he can find his rates.

Thanx

When I first came here to CT I looked, search and found what I needed, Lets
just say you need a place to start, then you can work & adjust from there.

That is how I did it, of course you have to know your OH. I cant tell hhim that figure.

__________________
Robert Good
It's Your Life-Make Fun Of It!
http://www.robertgoodpainting.com