Contractor Talk - Professional Construction and Remodeling Forum banner

1 - 20 of 21 Posts

·
Registered
Joined
·
1,989 Posts
Discussion Starter #1
What I am looking for is not for someone to tell me how to price a particular job. I am looking for the steps you use to estimate work. I have been in business for a couple of years. I am not making the kind of money I would like to be, which I think is fairly normal for a start-up, but I want to correct this ASAP. I do mostly kitchens and baths and I do all of the work myself with a helper (which I will change soon). I have only subbed out granite fab/installation up to this point. I get alot of compliments on my work, but I am always looking to improve my finished product as well as my income, and I would like to sub out most of the work from this point forward and run multiple (2 or 3) jobs simultaneously.....so...
What I want to know is...
1.) What process do you successful remodelers use to estimate a job when subs are involved?
2.) Do I insert my hourly rate for every working hour of each job on top of employee and sub costs, or divide it up between jobs? (seems like the price would skyrocket if I charge 40 hrs/wk per job).
3.) Would someone (Mike Finley :whistling) be willing to tell me approximately what the average price for labor for a general bath remodel (new tub, fixtures, tile floor and surround, retex and paint) is going for...(Ive been charging 7 to 8k and its not enough)
4.) Would someone else who does kitchens be willing to tell me what the labor price is for an average kitchen? (cabinets, granite, recesses and under cab lites, add some receps to backsplash area, flooring, texture and paint)?
Im in Southern California and would like to be making 6 figure income. I think my hourly rate is in the right ballpark but I tend to underestimate time.
I know this is a long post, but some guidance from people actually making money would be much appreciated.
 

·
DRIFTWOOD
Joined
·
803 Posts
One More Time

I'M IN N. CA. been doing this 45 yrs BUY IT,AND USE IT

HOME TECH REMODELING AND renovation COST ESTIMATOR

E Z TO USE AND FAST 1-800-638-8292
If You don't have a lic. GET ONE P S YOU'RE TOOO CHEAP

good luck Drift
 

·
Registered
Joined
·
1,989 Posts
Discussion Starter #5
Pearce. This figure is for labor only. I have been allowing the customer to purchase materials, which is no longer going to happen.

Slick. I have been figuring $65/hr for me (going up to $75 next job after reading this forum for a couple of weeks) and $30 for my helper, who I pay $12.50 and actually cost me $19 and change with W/C and payroll tax.

Drift. Thanks for the tip. I use National Estimator now, but almost never use the cost book. I dont trust it, and I dont try to compete with the productivity figures in it. I have more trouble estimating the amount of time my jobs will take, probably due to the fact that the customers are handling material purchases, and are either too slow with them and decision making. My last job the customer bought too little tile and too little grout. I charged for the time to get both items. I am licensed, bonded, and have 2 million G/L ins. and a warehouse space to store all the tools I've gathered from doing too much of the work myself. Too much overhead.
 

·
Registered
Joined
·
1,989 Posts
Discussion Starter #6
Still hoping someone will help me out with info about adding my hourly rate on top of sub cost and mark up, while running more than one job.....anyone???
 

·
Registered
Joined
·
91 Posts
divide it up based on theamount of attention the jobs would require during a specific time period. you should also have a profit coming from your employees labor, by increase the # of employees you will increase your profit, unless you get some hacks who need constant supervision and create significants amounts of rework.
 

·
DRIFTWOOD
Joined
·
803 Posts
Send it

This is My 45th year doing this !! The other books suck !!!!!!

Please give Me Your address . I'll be over to beat you over the head with a 2 x 4
 

·
Commercial Contractor
Joined
·
2,025 Posts
I do not know why someone would charge less for a helper then they charge for themselves???

I do, I charge about $20.00 less for a helper than a mechanic, or foreman, or superintendent...

You can't charge as much as you would for a guy who knows everything, for a kid who knows nothing.

IMO

$76.00/hour- Superintendent
$65.00/hour- Foreman(s)
$55.00/hour- Mechanic(s)
$32.00/hour- Helper(s)

and if I have to get on the job..

$84.00/hour
 

·
Registered
Joined
·
1,989 Posts
Discussion Starter #13
I appreciate everyone's input. Even the threats of violence...lol, but it would be really great if another remodeler took a few minutes to lay out his process step by step from start to finish so I can see how wrong I'm doing it.

Once you figure out how long the job will take and what your cost of the materials will be, and what the sub contractor costs will be.......

Are you lumping materials together, then adding a set markup percentage to that?...or using the sliding scale to mark up items individually?

I know I already asked this and got 1 quick reply on it....How much of my hourly rate would I apply to the job(s) if I had two or three jobs running at once.

I must sound like a p.i.t.a., but I really need to make some changes. All of my work has come from word of mouth. The only advertising I have ver done is handing out business cards and I have had vehicle signage since November. (2 whole phone calls from that...no work) I've been steadily doing job after job for 4 years on my own, licensed for 2 years or so...(union carpenter b4 that) and have had no time to sit down and really change the way I'm doing things until now. As of yesterday I am caught up with my work and seem to have hit a slow spot. (I had a bathroom lined up to start this week, but the customer might be backing out...not sure yet). All help is greatly appreciated.
 

·
Banned
Joined
·
14,078 Posts
I hope the PM helps you a bit, the numbers are just pulled out of air, but the process and ideas are valid.

Hey, when in doubt just add 10% to your next estimate, you might be suprised that they just say okay.

Sometimes when you are just so far off, just adjusting to what the market will bear will work.
 

·
Registered
Joined
·
1,989 Posts
Discussion Starter #17
I hope the PM helps you a bit, the numbers are just pulled out of air, but the process and ideas are valid.

Hey, when in doubt just add 10% to your next estimate, you might be suprised that they just say okay.

Sometimes when you are just so far off, just adjusting to what the market will bear will work.
A big part of my problem is that I dont really know what the market will bear. I have no idea what others are charging for similar work. To be honest, being that all of my jobs are from referrals, I dont even know If I have ever been bid against. Except for my most recent bathroom customer. She told me yesterday that she is getting another estimate. I think she indicated it will be from an unlicensed handyman. Hmmmm, I wonder if he'll be lower.
 

·
Registered
Joined
·
44 Posts
Pricing

Here are a couple of recommendations from someone who has been completing kitchen/bath/additions/renovations for longer than I would like to admit:
1) Calculate your actual labor cost including burden (taxes/insurance, etc.) into an hourly total cost. Estimate how long the job will take in man hours and yes, include every hour that you think you will be spending working on that particular job including meetings, picking up materials, completing the general construction phases and also include some time for follow-up and warranty work. Multiply the expected hours time your rate and this gives you the labor cost (before oh/profit). A simple, quick labor cost is to double what the salary is. If you pay your helper $18.00, use $36.00 as the labor rate. This method isn't as good as actually calculating the rate, but it should be close.
2) Estimate as best as possible, the materials. Build the project in your mind and on paper. Price out the materials for the job. We do not allow customers to supply any materials other than bathroom accessories and decorative light fixtures. You need to make the mark up on materials to stay in business.
3) Get quotes from subcontractors for the work. Prepare written specifications for them to use for the pricing and if possible, provide at least a fairly detailed sketch as well. The more details, the more accurate their price will be.
4) Add up the above costs and multiply the total by 1.6 and if you use this figure as your contract amount and if the job goes as planned, you should realize at least a 35% margin (gross profit before overhead) on the job.

This is an incredibly simplistic recounting of what I do for every job but it gives you a basic idea of one way of estimating a price for a project. Other items that need to be considered are access to the job, driving and travel distance, amount of details for the particular project, job schedule (is overtime going to be involved in order to get the job completed on time?) and a myriad of other important items. I always add an unknown/unexpected cost as well because there is always something you miss or something unexpected that will cost money you didn't include in your estimating. If I estimate costs on a bath remodel to be $ 4,000, I will add $600 in "unknowns". If you're nervous about the 60% mark up, use 45% or some other percentage until you get a good grip on what is a reasonable mark up percentage for your business and your region. There is nothing better than experience when it comes to estimating and bidding and over time, you develop systems that work best for you. Keep in mind that even a 35% gross profit margin doesn't guarantee profitibility if your overhead is 36% so there are many other factors that come into play. There are just so many variables that effect the profitibility of a company but if you make a 35% gross profit (or more) on each job, you should be at least on your way to overall profitibility.

Good luck and have fun while you work.....!
 

·
Registered
Joined
·
1,989 Posts
Discussion Starter #20
Luke. Thank you very much. That is exactly what im looking for. Thanks to everyone else who posted also. Between that and a couple of pm.s I got, I feel like I have a much better handle on things. As it urns out, I wasnt far off on anything except allowing enough time for the job. Thanks everyone.
 
1 - 20 of 21 Posts
Top