Materials Mark up, Trip fees

Discussion in 'Irrigation' started by Ferti-man, Feb 28, 2008.

  1. Ferti-man

    Ferti-man LawnSite Senior Member
    Posts: 252

    What are you all doing in materials mark up? If you purchase materials for 40% off list as an example, do you price it to customer at cost plus 40% to get back to list or is 100% over YOUR cost the going rate? Do you then also add for handling on top of mark up, such as another 5-15 %?

    What about initial trip fees to cover fuel, truck maintenance, job prep time...?
     
  2. BSME

    BSME LawnSite Senior Member
    from Midwest
    Posts: 829

    If you purchase materials for 40% off list and sell it to the customer at cost plus 40% you are selling for less than list.
     
  3. irrig8r

    irrig8r LawnSite Platinum Member
    Posts: 4,535

    In your example cost/ 60% would give you list price and a 40% margin. In other words, there's a difference between "markup" and "'margin".
     
  4. Mike Leary

    Mike Leary LawnSite Fanatic
    Posts: 22,063

    If you lose money by not charging list + 85 @ hr....you got a bad coke habit.
     
  5. Ferti-man

    Ferti-man LawnSite Senior Member
    Posts: 252

    Bad choice of words on my part. I meant the end result being list price dictated by supplier (mark up back to suggested list. Do you add to that for pick up / handling, using a margin system of x above cost regardless of supplier list price? Does it depend on the material such as zone valve vs. Brass Back Flow...? Hope that makes more sense :dizzy:
     
  6. Mike Leary

    Mike Leary LawnSite Fanatic
    Posts: 22,063

    Boy howdy, I'd sure be scared if a high roller like ferti-child came into my
    market. ;)
     
  7. Ferti-man

    Ferti-man LawnSite Senior Member
    Posts: 252

    Mike, The reason I am asking these questions is because I went to a seminar recently and they discussed adding trip fees, having a 200% margin and adding a bit more on to for handling. Seemed a bit much, so I wanted to see what others in the real world were doing. Its that simple. Thanks for the comment otherwise, or not. Why are you getting on my case already?
     
  8. Ignore him. He gets on everybodies case. I do agree that list plus hourly rate seems fair. This 200-300% markup leaves a bad taste in the customers mouth and would make me feel a tad greedy.
     
  9. Ferti-man

    Ferti-man LawnSite Senior Member
    Posts: 252

    Thanks Fimco Meister, Its what I thought as well, just wanted confirmation. Mike needs another :drinkup:
     
  10. hoskm01

    hoskm01 LawnSite Fanatic
    Posts: 5,690


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