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Old 10-16-2013, 12:16 AM
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What would you price this job? I'm a newbie

I'm new to the business. I'm subcontracting right now. A guy designed the project, my crew and I do the dirty work.

Here are the details:
Materials (at WHOLESALE costs): $1,750.00
Total Labor hours (including me): 66
Extra expenses (gas to/from, equipment rentals):$490.00

So...what would you guys say you would price it as? I'm not talking as a subcontractor, just overall price to hand to customer.
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Old 10-16-2013, 12:17 AM
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Here's what I'm figuring. You guys tell me where I'm off.
I would say this is a $7,428.14 job. That breaks down as:
Materials: 5,292.06 (wholesale times 3)
Labor: 1,650 (66 hours x $25/hour)
Extras: 486.08 (I rounded up to 490 earlier)

Is wholesale times 3 reasonable? Btw, I wouldn't break down line items on a bid like this with the customer.
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Old 10-16-2013, 07:07 AM
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What's the job?

Can't comment as to how it should be priced unless we know what may or may not be included in your pricing, and what possibly might be left out.

Your overhead is also going to play into it.
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Old 10-16-2013, 07:47 AM
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Generally speaking-

double wholesale and I can't believe you're covering overhead at $25/hr labor.


BUT impossible to say without knowing the job.
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Old 10-16-2013, 09:48 AM
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Quote:
Originally Posted by Clarkkent View Post
What's the job?

Can't comment as to how it should be priced unless we know what may or may not be included in your pricing, and what possibly might be left out.

Your overhead is also going to play into it.
The job includes putting in 2 beds, planting 3 small ten gallon crape myrtles, 3 5-8 ft blue atlas trees, 1 7-8 ft golden deodora, maiden grass all around, salvia plants and a few others. (Removal of sod, applying edging, hauling in 1 ton of top soil, landscaping fabric, plants, then adding 2 tons of 3"rock instead of mulch). Also includes delivering and installing five ~200 pound boulders, and cutting down/hauling off a 20 ft very full tree. I rented an auger and had to rent a truck from Home Depot. My brakes went out on my work truck. The unexpected rentals account for $390.

Last edited by Bigpoppa85; 10-16-2013 at 10:24 AM..
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Old 10-16-2013, 09:52 AM
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Quote:
Originally Posted by brooks View Post
Generally speaking-

double wholesale and I can't believe you're covering overhead at $25/hr labor.


BUT impossible to say without knowing the job.

I'm not covering much overhead at $25/hour. However, I am making it up by overcharging on the material. My logic is that, as a newbie, I am always going to be off on the time expected to complete the job (total man hours). I have been low everytime. So to balance that out, I gave myself the cushion of tripling wholesale prices. This gives me a balance where I know I'm not going to underbid hours tremendously.

Does that make sense? How would you estimate it?
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Old 10-16-2013, 07:13 PM
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why would you triple the wholesale, an unreasonable business practice, and not just charge a reasonable amount for labor? $25/hr seems unreasonable to me, and you'll get burned when your customers become accustomed to your cheap labor and you have to raise it later.

Try to avoid doing anything that you have to describe as "overcharging", (the word has a terrible ring to it).
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Old 10-16-2013, 11:43 PM
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And even if you don't show the "why" behind the final price, it'll leave you dancing unnecessarily if the client wants to eliminate materials, finds their own source, etc.

I usually don't mark up materials much at all, maybe 1.25 just to cover taxes, and time to locate, etc.

Now if there's extra time to drive and pick up, then time and gas should be factored in.

I agree with above comments. Charge for your labor, charge for your expertise, charge for your experience. Don't get burned on materials, but don't make it your profit center either.
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Old 10-17-2013, 08:43 AM
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I should clarify- I double green goods, which generally brings it up to retail pricing & covers sourcing time, and mark up hard goods like Clark. Our profits come from labor.
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Old 10-18-2013, 05:27 PM
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Excellent advice here. I knew my formula was nothing but a stop gap until I found a real one.

What do you all think about this one:

Materials: 200% of wholesale (double wholesale)
Labor: $50/ man hour.

Is that reasonable or do you think it should be more like 175% of materials and $65/man hour?

In the 200% MU example, I show the bid to come to 7,200. That's fairly close to my original number. In the 175% example the price would be 3062.50+4290=7352 +400= 7752.50

Which do you think is more feasible in the long run?

Last edited by Bigpoppa85; 10-18-2013 at 05:33 PM..
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Old 10-19-2013, 06:34 AM
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I have always had a problem with set hourly pricing for all employees. Are we talking about $65/hour workers, because that sounds like a very highly skilled person to me. are they new to this type of work? Do they bring 100 percent to the job every day? What is their pay? Are they on the phone throughout the day? Do they take frequent smoke breaks?

How will your clients perceive your charges if they would answer negatively to some or all of those questions?

There are no simple answers.

Most of my friends in the industry don't mark-up hard materials more than 25-50 percent.

You may have to come to terms with the fact that with experience, increased speed, efficiency and quality come profits, but the learning curve leading up to that point is an education, which often times has a cost.
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Old 10-20-2013, 12:05 PM
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Quote:
Originally Posted by matt in maine View Post
There are no simple answers.

Most of my friends in the industry don't mark-up hard materials more than 25-50 percent.

.
Amen Matt. @Bigpoppa, I really think you're trying to be too formulaic.

You just had a handful of experienced pro's tell you they don't mark up hard goods more than 1.25 to 1.5 at the most, and you come back with a markup of 200percent.

Here's my advice. Don't mark up the goods that much. Charge a fair labor rate based on the experience and expertise you're bringing to the table. It sounds like that may be less than what some of your competitors are charging.

Be honest with you clients, tell them you're just getting started in the business and you're looking to build a reputation.

Try to estimate your hours as close as possible. Don't underestimate, get paid for what you're doing.

And if you get halfway through the job and realize you underestimated, suck it up, DELIVER A KICK ASS PRODUCT, and remember your error when it comes time for the next bid.

You'll be left with a happy client, a glowing review/reference, and estimate experience, and you can build off that moving forward.

Every job is different. You can't just punch some numbers into some Seussian machine where they'll spit out on the other side. Yes, it takes a bit more time than simply doubling wholesale and adding a flat labor rate to it, but it will be more accurate, be more competitive (in your favor perhaps) with the competition, and prevent you from getting burned.

Oh yeah, make sure you're licensed and insured and legit. And make sure you cover any associated costs in with your overhead calcs.
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Old 01-30-2014, 01:31 AM
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25/hr is far too less. Should be around 40/hr
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Old 09-07-2014, 02:37 PM
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I charge materials at 1.5X-2X to cover time to pick them up, replacing any materials that may get damaged, ect. I make most of my money on the hand made materials (I have molds for cementing, make cement panels, bird baths, trellises, ect)

As a super human who can do everything now, I'm not good at estimating time either. I can be totally unrealistic. I have learned it's better to give yourself more room to budge than less. Always. It is better if you think it will take you 30 hours, that you quote for 40. If the job takes 30, the people are lovely to work for, ect, it always gives a job a bit of frosting to say "I over quoted, it may cost you less than estimated". Telling a client a job is costing way more is a dismal way to kill your reputation.

If they are a pain in the ass, do try to add crap in, ect, than they already agreed to pay more.


Under paying yourself isn't good, but as a new landscaper I understand that fear of not getting the work you need. There can be a silver lining. If you have done several very nice jobs, even if you were under paid, take photos, break the jobs down, and make a portfolio which displays the work and a price you would want for it now that you are more experienced and find a way to display it to clients outside of your referral pool.
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Old 01-13-2015, 12:01 AM
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I agree with greentrade $25hr is too low but here we charge $40+hr.
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