View Full Version : Price Mark up on Materials/Plants
01-29-2003, 11:15 AM
When doing an installation how much do you mark the product up and then do you charge an hourly rate/man? Before I would mark everything up 100%. So if I bid the job for $10,000 I would be profiting about $5,000 on everything. I would figure out what materials and how much labor was needed. Usually in the past I have been accurate as far as time. I will add in time incase an obstacle occurs. LCO's please give me some feed back. I want to be competitive but also I offer quality and knowledgeable work done, so I will be higher than most competitors. I also can offer a CAD design which is a big hit. Thanks for your time and input
01-29-2003, 12:01 PM
cost of sales + expenses + profit goal + customer/site factor = quoted price. With Regards... devildog
01-30-2003, 11:19 AM
if you're marking everything up !00% does that mean you are actually charging twice as much for your labor cost? Say you wanna make $50 an hour, you are actually charging $100 after the mark up? I figure out labor cost and then material cost and mark up on the material then add in any possible extras
01-30-2003, 01:31 PM
Originally posted by devildog
cost of sales + expenses + profit goal + customer/site factor = quoted price. With Regards... devildog devildog what do you mean by customer/site factor? how would this affect your markup on materials?
01-30-2003, 02:27 PM
In landscape work, percentage markup for labor is inaccurate. % for overhead works, but labor is your biggest variable.
A 2" oak costs a lot more than a 2" willow and yet the cost of labor to plant is roughly equal. With a straight percentage for labor, the oak customer gets ripped off and the willow customer gets a subsidy. The oak customer is already contributing to more overhead and the profit on the material should be higher, so why penalize him. Based on experience one should develop labor rates based on actual time averages for various tasks.
Also warranty costs for plant material should be at different %s based on your experience with that particular variety. A variety that consistently has a 25% mortality should have a 25% markup for warranty purposes while a species that only has a 2% mortality needs only have a 2% markup for warranty. How do you come up with numbers. Records, records, records.
01-30-2003, 05:47 PM
Originally posted by strickdad
devildog what do you mean by customer/site factor? how would this affect your markup on materials?
Just that, "customer/site factor". Once we've completed our budget estimate for the cost of sales & expenses, a target profit is added. Finally, before a Quote or Contract is done we put the job through a 9 point eval, AKA, "customer/site factor" checklist.
Each of these line items has a percent factor from 1 to 5% that we've determined through the years, that adds to the degree of difficulty for the job. We simply multiply our estimated price by the total percentage to obtain our final quote. With Regards... devildog
01-31-2003, 01:34 AM
Depends on the material. I have it to where all of the labor is included in the price of the material. Depending on what your using will determine your pricing. For instance, with mulch you might charge less as the quantity rises. With plants, I usually triple the cost of the plant. This will cover the labor, the fertilzer, etc. Works for me. Call other crews around your area and try and get prices. This will tell you if you are to high or to low.
01-31-2003, 02:58 AM
devildog, it sounds like to me that you are grading the site, and the customers ability to pay? to me a site evaluation would have a direct reflection on the "labor rate" not the mark up on materials.
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