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Markup On Materials?

 
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Old 03-07-2012, 10:23 PM   #221
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Re: Markup On Materials?


You guys are too quick for me tonight.
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Old 03-07-2012, 10:23 PM   #222
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Re: Markup On Materials?


Quote:
Originally Posted by plummen View Post
What are they called,and do you know of a wholesale source for them?
We could all just use your connections and save 99% off retail!
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Old 03-07-2012, 10:28 PM   #223
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Re: Markup On Materials?


I know where theres a bunch of unlicensed pharmacists that like to stand outside one of my buildings,judging from the way most of those idiots look most days I dont feel nearly so bad about myself!
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Old 03-07-2012, 10:31 PM   #224
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Re: Markup On Materials?


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Originally Posted by TNTSERVICES

We could all just use your connections and save 99% off retail!
Yeah then we would be in the 1%.
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Old 03-08-2012, 06:31 AM   #225
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Re: Markup On Materials?


First one in for the day.

So who's marking up today and who's not?
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Old 03-08-2012, 07:32 AM   #226
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Re: Markup On Materials?


Well Im getting ready to fax an electrical permit and a plumbing permit to the city ,I get to mark up material on 2 projects!
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Old 03-08-2012, 09:33 AM   #227
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Re: Markup On Materials?


I guess I am at a loss to understand what you are looking for... plenty of examples have been given and resources provided... are you looking for us to do the work and provide your local/regnional resources for manufacturers and wholesale distributors for you?

The fact that it IS out there will either motivate you to want to go after it or it won't... like was said, it all comes down to what you are selling. Your only choice may be a wholesale distributor depending on the product. But that is not the only option for other products.

But even if you are only buying from a wholesale distributor or a manufacturer, it still brings us back to the main point of the thread - "markup on materials"...

Everyone runs their business differently and has differing POV's, but I guess if you have capital reserves, emergency fund, no business or personal debt, a retirement fund, etc... it really doesn't matter what you do as it relates to markup as whatever you are doing is working... if you don't have those things however, I would encourage you to consider that you may be leaving money on the table that you could otherwise use to fund the above...

If you track your close ratio's (i.e. - how many appt.'s it takes to get a sale), try this for the next 30 days...

RAISE your prices 10%, and track how many sales you close. You will most likely find (as most do) that it really doesn't affect it that much and it sometimes even INCREASES your close ratio. But here is the thing, take EVERY DIME of that 10% and put it into a separate account as an emergency fund. You were paying your bills without it previously, so this should not affect your normal operation. Once you have done this, look at that figure at the end of the month, and then look at what COULD have been over the past year.

Once you have an emergency fund (1-3% of annual sales), then start working on having one months of capital reserves set aside, then three, then six... then take that same money and start building your retirement fund. Once you are in this position, just like the person who is REALLY trying to get out debt, you start to FIND ways to extract profit from your business that you previously would have just overlooked.

If you do this, REALLY do this, I promise you that the 10% increase will only be a start... you will liberate yourself from robbing Peter to pay Paul cycles, and begin the cycle of focusing on work that meets your needs, and having not to settle for less so often.

I always find it amazing that guys can't envision raising their prices, but will do so to pay SOMEONE ELSE when a supplier raises their rates or they choose to be an unpaid salesperson for the bank and raise their rates 2-4% to offer credit cards... they do this out of necessity... make YOURSELF, your family and your business the necessity... something to consider...

Best of luck... 8^)

Last edited by KAP; 03-08-2012 at 03:24 PM.
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Old 03-08-2012, 02:18 PM   #228
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Re: Markup On Materials?


Quote:
Originally Posted by TNTSERVICES
They still don't know what I was doing for those few hours, but they don't have to. I am the one that stays up till 1am putting things together (or on CT)....never mind.
They do now : !
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Old 03-08-2012, 02:49 PM   #229
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Re: Markup On Materials?


This thread was way more entertaining when everyone was arguing..

I think mark up bad... :
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Old 03-08-2012, 03:40 PM   #230
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Re: Markup On Materials?


Quote:
Originally Posted by ohiohomedoctor
This thread was way more entertaining when everyone was arguing..

I think mark up bad... :
Ok,

I think mark up GOOD....:

And my mark up's bigger than your mark up!
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Old 03-08-2012, 04:01 PM   #231
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Re: Markup On Materials?


I usually charge customers two to ten fold more money for a receptacle or a piece of wire if it's a tiny job like replacing one wall plug.

Obviously, the bigger is the job, the lower is a multiple I can charge for materials (one can not charge $10,000 if the cost of materials is $1000).

For small jobs I charge up to 1000% more for materials, for big jobs 10% to 20% more.
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Old 03-09-2012, 12:07 AM   #232
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Re: Markup On Materials?


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Old 03-09-2012, 09:44 AM   #233
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Re: Markup On Materials?


My typical mark up on T & M is 150% on material
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Old 08-28-2012, 11:24 AM   #234
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Re: Markup On Materials?


My husband prices the material on his quotes using the retail price online, then gets a 5% discount at the store. So he has a 5% markup i guess.
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Old 08-28-2012, 02:51 PM   #235
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Re: Markup On Materials?


I don't make money on materials. I make money on the service that I provide for people.

I do leave a nice fluff in my material budgets though, usually 35-50%. If I perform an accurate takeoff, i'm rewarded with some additional margin.

Pricing out material, picking it up etc is factored into my overhead.

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Old 08-28-2012, 03:06 PM   #236
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Re: Markup On Materials?


For Me I factor any markups on the labor side to avoid having to deal with getting a resale license and then dealing with the board of equalization. I have enough govt. entities to send checks to as it is
so, I only sell labor/service.
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Old 08-28-2012, 07:39 PM   #237
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Re: Markup On Materials?


So one time ho says "the dump will take that for free", "O" ok i will not charge the $20 to dump, 1 day later call from ho "hey you left all the trash here" yes sir i did, you told me "the dump will take that for free" have they not took it yet?, my $20 charge was to load it and dump it. give um a call.
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Old 08-30-2012, 09:34 PM   #238
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Re: Markup On Materials?


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We do handyman and small remodeling work. Our company policy is to mark up all material purchases that can be directly tied to a customer by 30%. Overall this is working pretty well for covering the cost of all materials including the misc ones we don't directly bill. For example: I bill the customer my cost of the disposal + 30%. The markup covers cost of towels and any other misc materials I may need, like a new seal or even new drain pipe (if I have one on the truck). It also covers my risk and carrying cost of paying for their materials at the start of the job and not being paid for the job until some time later.
The problem is that from time to time, I have a customer who questions the cost of the materials. They see $113.88 for the materials and then challenge my invoice or bid with "I can buy a disposal at HD for $99, why do you charge me $113.88". Sometimes it is easy to justify the difference, other times it's not. Either way, by the time the customer asks the question, their opinion of me is already tarnished. Other times it is difficult to justify, for example, last week I bid for new blinds throughout a house. My cost for materials was about $500 then the 30% markup of $150. While she did question me on the cost of the blinds, I was able to accurately communicate to her the blinds I would supply were a much higher quality than the HD's entry level blinds. In this way I was able to avoid the markup question but this would be an example where I would have a hard time justifying the markup to the customer. Especially in this case too I would not want the customer to go buy them on her own for me to install because if she buys the wrong size then I have to spend extra time/trips to the house for her mistake.

Questions:
1) How much do you mark up for all materials?
2) How do you communicate this to the customer in a way that prevents needing to justify your materials price?

thanks
The reason for marking up material is simple, acquiring the proper materials to perform the labor of installing said material is a service in itself. Acquiring material takes time & man power, you can cover these costs by either directly billing as such or simply mark up materials. If you don't mark up material and "hide" the time & man power cost for acquiring material in labor then you may be setting yourself up for a dispute on labor charges. As for your example "Blinds throughout a house", if you want to feel better about only marking up by 30% call some of the interior decorators that specialize in window treatment from your area, If they are priced anywhere in the ballpark of the decorators in our area I'm sure your markup of 30% is conservative!!

http://www.vcgconstruction.com

Last edited by VCGConstruction; 08-30-2012 at 09:36 PM.
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Old 12-23-2013, 07:43 PM   #239
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Re: Markup On Materials?


Love this discussion, i have to subscribe to this thread
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Old 12-23-2013, 07:51 PM   #240
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Re: Markup On Materials?


im a plumber

on small parts($0-$4.99) for service work its 300%---for anything over $5 its 50%-100%

for fixtures its always 35%..i get them for 58% of list and I sell them for 70% of list

on remodels I markup parts 50%

on new homes I markup parts 35% + 10% fudge factor(forgotten parts)

I never get anyone questioning anything except for fixtures....when they question it I tell them its part of my profit......sometimes if they complain enough I add a couple hundred onto the bid and let them buy the fixtures...I make the same profit and they get no warranty........stupid as it sounds I get a few of these customers every year.

if someone is complaining about $20 for a garbage disposal you need a better customer base....you pick your customers by your pricing/service......they don't pick you

once in a while ill get someone who wants to supply his own parts....I refuse the work....if the part goes bad in 2 weeks who is he going to blame? he's going to say I installed it wrong....ive had customer supplied parts from HD with holes in them...even had a no burst fridge line blow out as soon as the water was turned on.....that was the last time I allowed homeowner parts.....

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