Irrigation Charging?

Discussion in 'Irrigation' started by RwADesigner, Oct 30, 2002.

  1. RwADesigner

    RwADesigner LawnSite Member
    Posts: 107

    Do you guys use the "Charge by head" or "Charge by zone" way of pricing a irrigation system?

    Or do you have a completely different approach.

    Please share your ideas on this
     
  2. VERY SIMPLE:


    All your costs (valves, timer, heads etc.)

    PLUS

    all your labor costs for time spent on this job

    PLUS

    all your "per hour overhead" (you do know your per hour cost of doing business right?)

    PLUS

    Desired profit

    EQUALS THE PRICE OF THE JOB


    Sorry, no magic formula, everybody has a different cost for each job, or at least they should. Not all companies cost the same to operate right?
     
  3. HBFOXJr

    HBFOXJr LawnSite Bronze Member
    Posts: 1,712

    I've written a bunch about this. Read my old posts.
     
  4. Ground Master

    Ground Master LawnSite Senior Member
    Posts: 505

    ditto sprinkler guy
     
  5. JimLewis

    JimLewis LawnSite Fanatic
    Posts: 6,842

    Ditto what Sprinkler Guy said except I simplify it a little.

    I already have in my mind a desired rate for labor - per day. This rate includes overhead and profit. It's $400 per man per day. That's $50 per hour for an 8 hour day.

    So today I gave an estimate for a sprinkler system. I guessed at parts (and permits) costing me about $1000 (which is pretty accurate) and I figured we'd need two guys the first day ($800) and my foreman could finish up from there on his own for another 3 days ($400 x 3). Total price for job = $3,000.

    I use this price/day/worker thing for all of my estimating. For irrigation, it's a little higher because it's a skill thing and that's the market. But for clean-ups, installations, etc. I charge $350 per man per day. That covers me for 10 hours at $35 per hour IF the day goes that long. And often times it's just 8 or 9 hours.

    It makes it a lot easier for estimating. I can look at most jobs and think to myself, "Yah, two guys could get that done in ___ days. So I'll charge ____." As for knowing how many days it will take a guy or a few guys - that's just something that comes from experience. But I am pretty dead on these days.
     
  6. Well if the truth be told....that is exactly how I do it Jim!

    Only I add some markup to the parts just for fun...for example:

    Typical 3 zone system one of them being a drip system w/ 100 plants.

    Timer 250
    PVB 150
    2 grass valves 100
    1 drip valve 100
    1 valve box 25
    10 hds per zone/20 total 200
    100 drips 100
    1 roll tubing 50
    400 pvc 100

    2 days labor 1200

    Total without tax 2275

    I get 3 out of 10 bids roughly, which is pretty good and usually it is 1.5 days not 2 by the time we're done. I wish I could do 2 of these per week for 52 weeks per year!
     
  7. JimLewis

    JimLewis LawnSite Fanatic
    Posts: 6,842

    We get that rate or maybe a little less. There is a LOT of guys around here doing it for hella cheap. I don't understand why because it's super difficult to become an irrigation contractor in this state and there aren't too many of them around. But the ones who are, have perfected the art of turning what should be a 5 zone system into a 2 or 3 zone system (complete with shrubs and lawn all on the same zone, and many other shortcuts) so that they can reduce the price by $1000 or so from what I charge. So customers often choose my competition over me just because of the price.

    We even provide a really detailed portfolio explaining why the systems we design are superior to the way most competitors do it - but this rarely seems to influence people. They seem to like the cheaper price.

    I have determined that in order to land jobs like you speak of (2 / week all year) I'll have to find some way to lower my prices drastically. And that means cutting corners or becoming REALLY efficient and fast at installing them. I dunno....... But I, too, would love to land a LOT more of these jobs. It gets really annoying when you go give 5 bids and don't land any of them.......
     
  8. Unfortunately the customer doesn't care about quality or integrity until after the job is over. We find that most systems we DO get to install are referrals from current customers who are happy.

    Since we do a lot of service also, we get to see these bad systems all the time after they were installed improperly. You are right, here though it is trees/shrubs on the same drip zone.....15 gallons on each lawn valve piped in 3/4 class pvc...shade and sun on the same zones......hills on the same zone as flat areas...I could go on and on.

    I agree that the way to do more systems would either be to bid these jobs apples to apples or get more efficient. Or more volume with less profit per job. I have struggled with this for 10 years and here is my conclusion.

    I raise my rates every year in order to make more money doing the same amount of work or less with the same employees year after year. We do get more efficient. We do fewer installs than some companies but our margins have to be higher......

    The less work we do the less liability we have and the less headaches. This has allowed me to live in Beautiful Colorado and own a business in Scottsdale. I don't have to hold hands anymore with employees. Every year for the last 3 years I have added a technician and plan to again this spring. Expanding into more service breeds more installs with less headaches, I think.
     
  9. devildog

    devildog LawnSite Senior Member
    from sc
    Posts: 270

    You can have a per head price, if you are working a devlopement with alot of identical houses. BUT, I'm not recommending this sort of bidding/estimating. IT TAKES ALOT OF EXPERIENCE WORKING IN IDENTICAL CIRCUMSTANCES.

    You did not mention IF YOU ALREADY INTO IRR INSTALLS, GETTING IN, HAVE A PUT TOGETHER CREW ETC, so I'll just throw out some ideas / info

    ? if not into irr installs, go in slowly, a season or two.
    ? if not irr certified, do it.
    ? if not bacflow certified, do it.
    ? if not into irr serv work, do it.
    ? if not member trade assoc, do it.

    $ don't fall into the trap of buying from one vendor (we use 3)
    and typically save 12% on what the others are buying
    $ we've come to know for every hour spent on design, (within reason) our field effiencies are now at an all time high (per zone)
    $ don't let the install crew have the authority change design layout without approval. and then it should be for a labor or material savings. your bid counts on the job costing for the bid.
    $ reward the crew lead if he (or she) brings the job in with a 10% saving in materials AND!!! 10% SAVINGS IN LABOR estimates.
    $ do make sure the crew goes to the install WITH EVERYTHING and spare materials. mistakes do happen. routinely resupply all consumables
     
  10. devildog

    devildog LawnSite Senior Member
    from sc
    Posts: 270

    You can have a per head price, if you are working a devlopement with alot of identical houses. BUT, I'm not recommending this sort of bidding/estimating. IT TAKES ALOT OF EXPERIENCE WORKING IN IDENTICAL CIRCUMSTANCES.

    You did not mention IF YOU ALREADY INTO IRR INSTALLS, GETTING IN, HAVE A PUT TOGETHER CREW ETC, so I'll just throw out some ideas / info

    ? if not into irr installs, go in slowly, a season or two.
    ? if not irr certified, do it.
    ? if not bacflow certified, do it.
    ? if not into irr serv work, do it.
    ? if not member trade assoc, do it.

    $ don't fall into the trap of buying from one vendor (we use 3)
    and typically save 12% on what the others are buying
    $ we've come to know for every hour spent on design saves hours of install time, (within reason) our field effiencies are now at an all time high (per zone)
    $ don't let the install crew have the authority change design layout without approval. and then it should be for a labor or material savings. your bid counts on the job costing for the bid.
    $ reward the crew lead if he (or she) brings the job in with a 10% saving in materials AND!!! 10% SAVINGS IN LABOR estimates.
    $ do make sure the crew goes to the install WITH EVERYTHING and spare materials. mistakes do happen. routinely resupply all consumables, nothing than a crew swabing the bottom of the glue can and putting in a supply line (CALL BACK!!)
    $ set up a cargo tralier to do these installs.
    $ study the competition. its amazing what you will see if you look at their actual install procedures / process

    Having said all that its all about design experience and installation
    effiencies. In closing
    + cost of sales
    + expenses
    + profit (min 15%)
    = quoted price

    with regards... devildog
     

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