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cost of operating equipment

Discussion in 'Lawn Mowing' started by kellroy, Aug 13, 2006.

  1. kellroy

    kellroy LawnSite Member
    Posts: 39

    does any one have the break down on cost to oper each hour , each piece of there equip example z turn mower/weed eater /blowers /hedge trimmers. i "ve seen a break down several years ago very helpful , but can"t seam to locate thanks in advance kellroy
  2. br1dge

    br1dge LawnSite Member
    Posts: 49

    In developing a business plan (which I may or may not execute) I have assumed $3-$4 maintenance costs per hour (includes mowers, blowers, trimmers, & edgers.) Was hoping this would cover blade sharpening, Washing and cleaning, belt replacements, any mechanical repairs not covered under warranty.

    Would like to hear some other opinions.... jeff
  3. AGLA

    AGLA LawnSite Bronze Member
    Posts: 1,742

    The fixed cost per hour goes down by how many hours a year you use it. The cost of buying and storing a $5000 dollar mower used 300 hours a year is twice as much as if it were used 600 hours a year. Then maintenance, labor, fuel, and hauling is directly related to use. Don't underestimate the importance of that first point.
  4. gene gls

    gene gls LawnSite Gold Member
    Posts: 3,213

    Every ones cost is different. It all depends on how much you run the items and how hard they are worked.
  5. horsequick

    horsequick LawnSite Member
    Posts: 131

    Costs will be the same. No matter if you use it 2 hours or 500 hours per year. Now if you're talking profits over cost then yes, the more hours the more profits.

    You should be able to figure out what it cost you to operate your equipment fairly easy. Take in to account your trucks gas getting from house to jobs. Also factor in fuel used per hour by your equipment. Figure in how many times you change edger blades. I have to change mine about every 7 or 8 yards. So maybe I use 15% of the cost of an edger blade per hour. Figure in trimmer line if you're getting an exact cost. The list goes on and on as to what it costs you to operate per hour. Maintenance, spare parts, ins, advertising, etc. etc.
  6. gene gls

    gene gls LawnSite Gold Member
    Posts: 3,213

    You need to rethink your cost, 2 hours verses 500 hours....
  7. ChadsLawn

    ChadsLawn LawnSite Bronze Member
    Posts: 1,110

    yeah how is 2 hrs and 500 hrs per year the same? So you telling us $3.00 a gallon of fuel will last me either 2hrs all the way up to 500 hrs?. Wow hook us all up with that plan.
  8. cleancutccl

    cleancutccl LawnSite Senior Member
    Posts: 698

    what I think gene was trying to say is that your cost per hour should be figured as soon as you get the piece of equipment. Meaning that you should be charging the original cost of the machine back to the jobs you are doing with it. Once the machine is paid off it is in turn making a profit to buy a new piece of equipment. Just because a machine is used more hours than another shouldn't change anything because you should be using the useful life of the machine to calculate cost per hour, or how long the machine should last you before needing to be replaced. If this is confusing to you you should look into talking to a consultant about setting up your costs per hour.
  9. horsequick

    horsequick LawnSite Member
    Posts: 131

    LOL. Do you guys have ANY business experience other than cutting yards? It's VERY simple in fact. The cost to operate ANYTHING per hour whether it be a freakin' helicopter, crop duster, or a lil' small spark ignition lawnmower will be the same whether you operate it 2 hrs or 500 hrs. Fixed costs never change. Hence the word "fixed". To figure how much something would cost you to operate per hour you have to look at the word "cost". Get the term "profit margin" outta your mind. The cost, YES, whether it be one hour or many, can be figured easily. The number of hours that you use that piece of equipment is irrevalent. As a matter of fact, ANY number of hours past the 60 minute point is useless information. Because what he's trying to figure out is "cost" for ONE hour.

    Now....when you start adding hundreds of hours, yes your "profit margin" increases greatly. Because your fixed cost are the same. You still must change blades after x number of hours. You still burn a certain amount of fuel per hour. You still do LOTS of things in an hour.

    In the next few days I'll take a careful look at seeing what it costs me per hour. If you want, I'll get my wife to put it on an excel spreadsheet. She's a CPA therefore much more qualified than myself.
  10. AGLA

    AGLA LawnSite Bronze Member
    Posts: 1,742

    Horsequick, If you run $20,000 worth of mowing equipment 20 hours a week vs. a guy running it 40 hours a week, he will make about $3 more an hour than you will assuming that you operate 34 weeks a year and you will replace your equipment in 5 years. That is just the price of the equipment, not the additional cost of the building to store it in. You would not pay your help three bucks more an hour and feel competitive. Why would you pay that much more for your equipment.

    This is the thinking that gets so many of you guys with barns full of equipment that could keep 12 guys busy full time, yet you only have 2 or 3 people working for you.

    Certainly the cost to operate the equipment and is the same in terms of gas, labor, and routine maintenance. But you are not accounting for the fixed cost that exists whether or not that equipment moves. The more it moves the greater the amount of money divided by that fixed cost = a lower percentage of money going to the fixed cost.

    Fuel and maintenance is use cost, not fixed cost. It is 1:1 with the use.

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