We don't pay in percentages. We give them a flat rate going into the job and unless something unknown comes up that's what they get when the job is done. We usually pay per square of roofing or siding. We actually have open agreements with them where we don't need to ask them before each and every job because we know what our charge is going to be.Florcraft said:75% if they have workman's comp, less if they dont, and we will provide the comp.
Well let me show you a spread sheat I did today (edited for easy math)nwingate said:Let me ask it a different way.
You bid a job for $150 (for the sake of easy math)
$50 for materials.
$100 for labor, advertising, overhead, etc...
How much of the $100 does the sub get?
I've heard estimates anywhere from $35 - $65.(or 35%-65%)
Assume the contractor has his own tool and insurance.
The flooring trade may be a little different than other trades. You guys are making a lot of your profit off of the sale of the materials. Trades like painting don't really make much (if anything) on the products. We are strictly selling a service.Florcraft said:All materials are of various margins, but the labor is figured what it is ( what we pay the installers) then we add 25% profit margin onto the labor and add it to the estimate.
I know some companies that use only subs. Infact the largest roofing companies in Chicago don't have any employees other than office and sales. One that I used to work for uses the same pricing structure that we use, except have been known to add more than we add!nwingate said:This is an interesting topic to me. Does anyone work for a company that only uses Subs and doesn't have any labor working directly for them?
If you could really get a way with paying a Sub 50% of a contract price minus materials it could be very profitable. (I would think)
Is this what your trying to do Grumpy?
What are the ups and downs to this?
Lack of control would be one Con.
Also, if customers found out you had no real work force it could look a little shaddy.
Like I said in my previous post I Know companies who use only subs. They have them use special sub tax forms. They also give them no tools or equipment. Just materials and the address for the day.nwingate said:How much control can you have over subs before you start getting in trouble with the IRS?
I've heard of a few companies who classified their workers as subs but the IRS considered them employees because of how they structured things.
I disagree.Trades like painting don't really make much (if anything) on the products. We are strictly selling a service.
Well, it still doesn't really look like your making money off of the paint, only covering your costs to buy it. The extra money your charging is only covering your time.ProWallGuy said:I usually charge $1 less than retail per gallon. My cost is considerably lower than retail. Afterall, it is my time and gas thats wasted by picking up materials, waiting for mixing, etc., and the customer thinks they are getting a deal.