Is there a formula for figuring actual expense of a ztr per hour?

Discussion in 'Lawn Mowing' started by Countrymow, May 1, 2008.

  1. Countrymow

    Countrymow LawnSite Member
    Posts: 30

    In bidding jobs, I would like to know how you guys allow for the actual expenses of your mower. I can estimate the time it takes to cut a piece of property, materials, gas, etc. The problem I am having is with the mower itself. Someone suggested the formula where you take the value of the mower new and use 1,000 hours as an estimate of its life span. Thus a $7,000 mower would be about $7 per hour. Is this a reasonable figure? Then you would have to add filters, blades, belts, routine maintenance, repairs, etc. What would be a good estimate on these expenses per hour?

    I am sure this has been discussed many times on the forum, but I cannot seem to find a discussion on this. My searching has been in vain.

    Thanks for your help.
     
  2. TomberLawn

    TomberLawn LawnSite Bronze Member
    Posts: 1,299

    There was a thread a few days ago about the hourly cost of running mowers. You'll find some helpful stuff in here. http://www.lawnsite.com/showthread.php?t=225682
    1000 hrs is low, like half. I've got a friend whose dad has close to 3000 hours on a couple Bob-Cats in his fleet. You can figure depreciation pretty easily. Take your purchase price, then estimate the salvage value (what you can sell the mower for when you're done using it), and estimate the useful life (how many hours you'll use it). Here's an example:
    $7000 mower cost
    $1500 salvage value
    2500 hours
    To find your "depreciable base" subtract the salvage value from the purchase cost. $7000-$1500=$5500
    Then, divide that by the number of hours you expect to use the mower. $5500/2500=$2.20
    Your depreciation per hour is $2.20. Add to that the cost of fuel, maintenance, and parts and you have your operating expense.
    To figure maintenance/parts costs per hour, figure out what needs to be done and the service interval. For instance, changing the oil is about every 50 hours. In 2500 hours, that would be 50 oil changes. Figure an oil change is $25x50=$1250. Divide that by 2500 hours and you get $0.50/hour for oil changes.
     
  3. tacoma200

    tacoma200 LawnSite Fanatic
    Posts: 5,426

    Most on Lawsite have come up with much lower figures than the studies I have read. But anyway I think $7 to $11 is a good average. Remember some ZTR's are much more productive per hour because of design, size, power, deck performance, and cutting speed. That affects you bottom line.
     
  4. Countrymow

    Countrymow LawnSite Member
    Posts: 30

    Thanks guys. These replies really helped.
     

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