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Discussion Starter #1
Good mornin all,
I'm new to this site and so far it seems full of useful info.

I am in the process of starting my own business.
Right now it's after hours and weekends.
It's a Maintenance biz. Tageting commercial property managers and real estate investors with rental property.
I'm be doing odd jobs..things like replacing broken glass, fixing holes in walls, painting and so on.

My only problem is bidding the job. I understand all the factors...
material costs + labor costs + overhead + profit = price.
I'm not sure how to "pad" it so I don't loose my arse on a job.
 

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Padding is in profit & overhead. Only you and maybe your accountant knows your overhead. Your overhead is EVERY bill that can't be tied directly to one job.

For example if there is a tool that can only be used once, you would probably work the price of that tool into your materials for the job bid... but if it is a tool that can be used over and over, you would work the price of that tool into your overhead.

Your overhead is also your:
all telephones
advertising
office rent
accounting fees
vehicle maintenance
insurances
office supplies.

The list goes on and on.


I'm not sure about maintenance but I know many companies add anywhere from 10-50% for overhead & profit. I target around 30% on my bread and butter jobs and 50% on unusual jobs.
 

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Grumpy, here and now roofers are making 100%, this will taper back to normal unless we get whacked again. A lot of the smaller guys are planning on early retirement.
 

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Teetorbilt said:
Grumpy, here and now roofers are making 100%, this will taper back to normal unless we get whacked again. A lot of the smaller guys are planning on early retirement.
:cheesygri :cheesygri :cheesygri :cheesygri
 

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You keep from losing your ass by accurately estimating the cost and charging a profit that's commensurate to the risk you're accepting and the marketplace you're selling in. The technique of 'padding' costs is best used on an item by item basis in your estimate- not on the entire value of your bid. For instance, when estimating the cost I might inflate the current price I have to pay for a specific item because I'm not sure exactly what it will cost in the future -at the time I'll need to buy it. If I'm bidding a job that will be done 3 months from now I might 'pad' the cost of diesel fuel in my estimate in anticipation of further cost escalation. If I have to quote a job in a hurry and don't have time to obtain recent price quotes I might 'pad' the prices I've paid in the past in anticipation of having to pay more in the future. The best estimates don't require 'padding' because you're able to nail the cost down hard prior to submitting your bid.
 
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