How much do you really make and hour? 20 and hour

Ron Musgraves

Ron Musgraves

Exterior Restoration Specialist
Staff member
How much do you really make and hour? 20 and hour


What’s the break down after its all said and done?


Hour employee:

Fuel costs per night:

Maintenance cost per night:
A: equipment
B: vehicles

Insurance costs per night:

Workman’s comp per night:

Office rent:
A: utilities

Office and stationery supplies:


I think even if you’re a one man band you will find that even if you just ad your fuel labor and insurance.

You’re going to find that you need to make over 32 dollars per hour before you make a penny.

How many of us thought that? How many people think they can make less? How many would challenge these figures and believe there over head is lower?

Before you do please sit down and ad them on paper. No I didn’t even put chemical costs in. I know for some this can even make them higher.
 
When I started out 4 years ago, as a "one-man-band", my goal was been $50/hr. With experience and upgraded equipment, my goal is now closer to $100.

Here's an example: 4 yrs ago, I charged $175 for an average house that took me almost 4 hours. I still charge $175, but that same house now takes me less than 2 hours. Where I still charge $50/hr is on decks and drives.
 
Ron, these numbers are based on 2003 gross receipts and total expenses after calculating roughly how many hours were actually worked.I wash from March to November with a very limited schedule in the winter months, normally grossing less than 2,000.00 in winter. Last year was tough with rain nearly 20 days each in both April and May and bad weather all through summer .I charge 70.00 per hour and after all is said and done I pull in right around 30.00 an hour for myself. That is after the following deductions: Taxes,all office expenses, fuels both truck and machines, insurances, materials, licenses and permits, replacement of hoses- qc's etc.... , computer and internet, cell phones,lease payments on machine, Vehicle payments and maintanance on vehicle and machines. I have no employees or worker's comp since its just me and I own my own shop and office. At 32.00 an hour id be out of business even being a one man band, i would struggle at 50.00 an hour. I was at 60.00 for a couple years until I got hot water last year, then the rates went up to 70.00. If my expenses grow so does my price to keep the same margin. Im in a completely different market than you so my numbers may not jive with yours. My overhead is fairly high with payments on truck and lease on machine. It takes right around 40.00 - 45.00 per working hour to run my business legit. I could cut alot of corners and bring the costs way down but I belive in quality over large profits. At over 70.00 an hour my job landing percentage goes way down. Once lease is up and truck is paid for my profit will increase until I buy again lol.
 
Ron,
I figure out my cost of duing business every season (maybe I should do it more than once a year - but no time). Last year my fixed costs for the year were around 37.50 per hour. I think everyone should find out what this number is because it does two things; 1) comparing it year over year allows you to see if your costs are in line and 2) gives you an idea of what you need to charge to be making money (not what the market is charging).

Great topic for conversation.

John,
why do you get less per hour for deck cleaning, is it half again as easy or half again more fun or are you just that slow at doing decks? LOL. Just kidding, I have work that we do that is not as profitable per hour as others. I make up excuses: ____ gets me in the door, the market won't bare the price of $____ per hour for ___, we need the work, etc.

Does the different pricing levels effect your advertising and priorities?

Mike,
I like what you had to say and agree about figuring out what you need to make and also being aware of what the market will accept. But, I think you misunderstood Ron, I got that he needs $32 per hour just to "turn the lights on" - that is not what he charges per hour.

I would reconsider the fact that "I own my own shop and office". I charge my business "rent" so that cost is in my overhead (it is a cost of doing business). Also, I know you are in Delaware so this may not apply, in NJ I would need to have workmans comp. ins. if I was a one man show - the contractors demand it (or they get charged for it when they get audited).

What does everyone else think?
 
Tim, I understood Ron's Point to be what is left after all expenses are paid and how much do you really make per hr. I can say I make 70.00 an hour but in reality i only make around 30.00. I interpreted his 32.00 mark to be what one must charge just to cover expenses and challenged anyone to provide proof that they can run a legitamite business on less than that. I cannot as justified by my numbers. 70.00 bucks an hour is about as low as I go. Here in De we are not required to carry Worker's Comp unless we have employees. We must carry liability insurance and that is what the contractors here always request for their audits. Very good point about renting out my shop space. I will look into that with my accountant and see what we can come up with. May be another deduction for uncle sam. By the way Tim, how are you faring this winter? Its terrible here snow everywhere and ice can't even hardly buy a day above freezing. Today is the first in almost 2 weeks. Gonna get 34 with 20mph wind out of the NW .
 
Fixed Cost $21.43
Varible Cost $12.86

Total Operational Cost $34.29

After everybody was fed and paid - I took home in 2003: $57.82 an hour.

Not factor in the above numbers, are lots of hours of thinking and planning late at night, when I was off the clock. The majority of my varible cost is in advertisement. I plan to raise that rate $3.00 to $5.00 in 2004.

The more I learn, the more I make. Without these boards, I wouldn't make half that much. Same example as above: I can wash a house in 2hrs that take others in my area 6 - 8hrs and I produce a better product for the same amount if not more.


Heres a question: Tell a story of when you made a bunch of money per hour or even per minute on one a job.

Last summer, I was so busy, that I bid $175.00 to remove mold off one side of two story vinyl office building & got it. So I threw it on my schedule to do at the end of the day. Now keep in mind, that I had to hurry, so that I could get to my daughters soccer game. From the time I turn my truck off to the time I started my truck to leave was 18 minutes. Thats about $525.00 an hour. I actually made $9.72 a minute.

Whats the most that you have made a minute?
 
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I got you guys thinking,, no one can run less than 32 and hour.. thats breaking even and paying yourself about 10 and hour..

thats reality.. i average over many units 71 dollars per hour..

I have sone guys that make 45 and some who average 90
 
Mike Smith said:
. By the way Tim, how are you faring this winter? Its terrible here snow everywhere and ice can't even hardly buy a day above freezing. Today is the first in almost 2 weeks. Gonna get 34 with 20mph wind out of the NW .
Click to expand...

I'm not Tim, but I'm going to comment anyway....This weather is brutal, but the snow is what's keeping me alive (I plow). The cold temps have helped too. There have been a couple of really weak snow storms that ordinarily we would not plow, but since the temps are never above freezing people are forced to have it plowed.

Spring will be here before we know it.....
 
Mike

Is there money in plowing snow?
 
Sure...........but you have to save some of it for repairs........snow plowing is really hard on a vehicle.

I didnt get into snow plowing for the money. Back in 2000, I was shopping for a new truck. I was pre approved for financing, and was seriously looking. Saw a truck sitting on the side of the road.........walked up to it, and there was no signs on it or anything. Just then, the guy walks up with a for sale sign in his hand.

I bought it that day. I had my mechanic look it over pretty good though........because it was a 9 month old truck with a snow plow..........I was worried..........but the guy had a legit reason to sell it.

Point is, the truck I ended up with came with the plow.......basically I got thrown into that business by default.

But I really enjoy plowing snow. I've always liked driving in the snow, now I get paid to do it. It's like that episode of the Simpsons where Homer gets his dream job in the bowling alley :)


I wouldnt recommend anyone rush out and spend thousands on a plow.........because it might take you a couple years just to pay it off! Depends on the year........
 
what do you put in your fixed cost verses variable cost?

This is the hardest area of understanding, Being a worker all my life, i never had to worry about it. I can buy all the software or books, but with out doing the math on paper myself I would never "Get It".

I accually use the Dome Bookkeeping, It works out great for my lack of accounting skills.

Matt
 
Fixed Cost - cost that you have month after month. For example your phone, electric, or anything with a contract. A loan is an example of a fixed cost.

Varible Cost - cost that you can stop - no contract - example if you have advertisement (as long as you did not sign a contract) or a mail-out, etc.

Labor can be a fixed cost or a varible cost. If you have someone on salary or working full-time, thats fixed. If you pay someone by the job, it can be classified as a varible cost.

Basically, your fix cost is what you have to make to stay in business.

I keep up with my fixed and varible cost for different reasons. I keep a running balance sheet. The two varibles can be used when developing your business budget or creating marketing plans, etc.
 
Wow, this is a real detailed thing here. My wife does the books and some of the work my company does has very little overhead. Just gas,labor and uncle sam ect.

Some days I can make over 200 an hour all day and pay for one guy labor and gas costs... other days only 100 an hour. I would say take 30% for taxes just to limit my math and it comes out to 70-140 an hour, including gas,labor and the rest of the overhead stuff.

Some days maybe as low as 25 an hour.
 
I had a job one time that a company from another state asked me if I could pressure wash the side of a glass building on a site. There was no water and one of the tires on a piece of equipment burst and went up half the building (library). They called me after calling several other pressure washing companies. They needed me immediately and I was an hour away and they had no water.

So, I charged them. $1,200 on the visa and away I went. Drove an hour down and spent an hour washing on a lift that they provided and then returned to the shop. I took one employee and paid him $100 cash for the 5 hours we spent working, driving and eating. Per hour, that was a good one.
 
Henry, thats pretty low$$$$ 25.00... labor in maryland must be low... can't get anyone decent here for less than 10 per hour and often 12 or 13.

I guess guys who run cold would run about 7.50 per hour cheaper also.. hot water costs.
 
Justin

Thats awesome. I would have thought others would have those dream jobs, where they made a ton per hr.
 
Hey Ron,
The $25 an hour was after all expenses including labor. It also very rarely ever happens but there have been those days when nothing goes right..lol

My company actually pays higher than most in the area by at least 2-3 an hour and I also have excellent benifits.
Our minimum starting pay is $10 but thats for no experiance and no drivers license or car. Sometimes it's just good to have another person around for some jobs.
 
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