pricing by manhours

Discussion in 'Lawn Mowing' started by Lacebark Boy, Jan 28, 2004.

  1. Lacebark Boy

    Lacebark Boy LawnSite Member
    Posts: 27

    Let me ask this question another way. How much would it be worth for a basic mow,trim,edge, and blow if it took 128 man hours? This is 4 guys at 8 hours a day,times 4 days.
     
  2. TYLAWN

    TYLAWN LawnSite Member
    Posts: 42

    I would say somewhere around $6500.
     
  3. LB Landscaping

    LB Landscaping LawnSite Bronze Member
    from Maine
    Posts: 1,309

    Depends what you have for overhead, and what your cost of doing business is.
     
  4. Critical Care

    Critical Care LawnSite Bronze Member
    Posts: 1,654

    How would this sound... If your employees got $10 per hour, wages would be $1280 dollars plus a bit more for travel time. So lets say, an additional four man hours ($40) per day, or $160 for four days. You'd be paying your employees $1440. With gas and other expenses you would break even charging about $14 per hour. If you charged $30 per hour for 128 hours that's $3840 total, or $16 per man hour profit. Does that compute?
     
  5. pjslawncare/landscap

    pjslawncare/landscap LawnSite Bronze Member
    Posts: 1,410

    Lacebark, Price that job high. Large jobs give good oportunity to make good money if priced with great consideration of YOUR expences OR can be a good oportunity to loose your fanny if you bid too low. If your not sure bid high at $6500. If you dont get it you loose nothing vs Underbid you lose big.
     
  6. DennisF

    DennisF LawnSite Bronze Member
    from Florida
    Posts: 1,381

    Here is a quick formula

    Total man hours X hourly rate of pay X 3

    EX.
    128 hours X $10 X 3 = $3840

    To make money in this business you have to multiply wages by 3 to cover expenses and make a profit.
     
  7. kris

    kris LawnSite Bronze Member
    from nowhere
    Posts: 1,579

    Dennis ...Im curious. How did you come up with the 3 x formula?
     
  8. DennisF

    DennisF LawnSite Bronze Member
    from Florida
    Posts: 1,381

    I use to work with a friend that owned a large lawn and landscape company in Michigan. Over the years he developed a system ( the formula) that would just about guarantee that you don't lose on a particular job. If you figure in hourly labor, insurance, maintenance of equipment, depreciation, fuel, etc it will usually come out to twice what you are paying your employees. If you're paying your employees $10 per hour, it's actually costing you $20 per hour, per employee to operate. So in order to "guarantee a profit" you need to multiply your employee's hourly pay by three. You could substitute a lower figure like 2.5, 2.6 or something less than 3 and use that if your costs are lower. But generally.. multiplying by 3 will yield a respectable profit.
     
  9. germann

    germann LawnSite Senior Member
    Posts: 259

    If a job involves no drive time and you are only working for one person, your overhead is somewhat reduced. In other words you might need $60 hr on a 3k sq.ft. job, but then have to do 20 a day and have drive time and increased managment and data entry.
     
  10. brentsawyer

    brentsawyer LawnSite Senior Member
    Posts: 663

    How much would it be worth or what others are bidding are about the same thing to me. From what I understand of large jobs like this is that if you bid $60 hour, you can forget about it. Think about it this way. A large company with large amounts of crews and large amounts of capital in equipment that is readily disposable for this job just needs to cover, employee wages, increased overhead and their profit margin. Like said before by DennisF, it will probably be awarded to a company in the range of 3 times employee pay, although that # has been on the steady decrease in the past few years. Last month one of the trade mags had this very point listed and I think it is somewhere around 2.8 right now. So if you have $12 per hour in employee costs*2.8*128=$4,300. As you can see that DennisF # and mine are simarily close with the given info using similar techniques. The thing that will make or break the deal is you gut feeling to stick to your guns, do the best possible job you can in estimating YOUR let me say again YOUR time for the job and like I said in the beginning, a large company would be happy with a profit like this for having an extra crew guaranteed at one spot. I know I would. Basically you just oversee the contract and make sure your guys are doing as told and make a good profit while your out doing something else.
     

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