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Old 12-15-2012, 11:28 PM
GreenLight GreenLight is offline
LawnSite Senior Member
Join Date: Dec 2008
Location: Birmingham, Alabama
Posts: 455
The toughest numbers to look at are abstract numbers in the background that are truly fixed overhead. When I hear the term "lowball", I generally feel that most of these guys look at the basic numbers (labor+materials+profit percentage = job cost). The very first thing I do every year is review fixed operational overhead. There are many small 5 man businesses that have a $300-500 daily fixed overhead everyday before they ever walk out the door in the morning. This doesn't account for one penny of labor or materials, just EXISTENCE fees. Being "profitable" is a misleading term because it can be interpreted as "whatever the boss gets after paying for the job". The job itself ends up almost being secondary to the fact that you have to build your model around simply being in business.
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