1. Groundcover Solutions

    Groundcover Solutions LawnSite Bronze Member
    Posts: 1,254

    I was wondering what % of a job do you guys make. Like if i did a 1,000 doller how much should i make for that. Any information would be great thanks.
     
  2. cleancut

    cleancut LawnSite Member
    Posts: 222

    Hey Hometown you need to be a little more specific about what type of job you're referring to...Is it a mowing job, mulching job, landscaping job????How much materials are you going to have to provide???You get the idea...Give us a little more info., and maybe we can help you out...Derrick
     
  3. Groundcover Solutions

    Groundcover Solutions LawnSite Bronze Member
    Posts: 1,254

    It is a landscaping job.

    i charge 60.00 for 1 yard of mulch dillivered and instaled.
    it costs me 30.00 per yard. 3 yards

    i charge 40.00 for 1 yard of top soil dilleverd and instaled.
    it costs me 19.00. 5 yards

    i charge 30.00 for 20' of blakc dimoned edging instaled.
    it costs me 15.00. 45'

    enployees cost me $8 per hour. should take me and 3 enployees 1.5

    that is most of it so what should i be making on this job!!!
    thanks for the help
     
  4. joshua

    joshua LawnSite Bronze Member
    Posts: 1,226


    from what i got you made a $130 in sales but you paid $100 in costs (labor and material) so you made 23% of the job.
    if i'm right i think you should raise your rates just a tad bit. i try to make between %40 and %50 of a job depending on what it is.for a job like this i would want to make about $50, you made only $30. thats only $6 dollars more than all your help, this just doesn't seem right.good luck
     
  5. Groundcover Solutions

    Groundcover Solutions LawnSite Bronze Member
    Posts: 1,254

    thanks for the information keep it coming
     
  6. Clinton D. Wagner

    Clinton D. Wagner LawnSite Member
    Posts: 45

    <B>Maybe this will also help</B>

    <table border>
    <th colspan=5><B>You Said Your Material cost was this</B><tr>
    <th>Materals needed</th><th>Cost</th><th>X</th><th><B>=</B></th><th><B>Total cost</B></th><tr>
    <td>Mulch/Bark</td><td>30.00 per yard</td><td>X 3</td>
    <td><B>=</B></td><td>$90.00</td><tr>
    <td>TopSoil</td><td>19.00 per yard</td><td>X 5</td>
    <td><B>=</B></td><td>$95.00</td><tr>
    <td>Edging</td><td>15.00/45 lf</td><td>20 lf</td>
    <td><B>=</B></td><td>$15.00</td><tr>
    <td>Labor /3 men at 8.00 per hour</td><td>= 24.00 per hour</td><td>X 1.5 hours</td>
    <td><B>=</B></td><td>$36.00</td><tr>
    <td> </td><td></td><td></td>
    <td>Total cost</td><td>$236.00</td><tr>
    <th colspan=5><B>An You Said You Bid This</B><tr>
    <th>Materals Bid</th><th>QTY</th><th>Rate</th><th><B>=</B></th><th><B>Total Bid</B></th><tr>
    <td>Mulch/Bark</td><td>3 cy</td><td>@ 60.00 per</td>
    <td><B>=</B></td><td>$180.00</td><tr>
    <td>TopSoil</td><td>5 cy</td><td>@ 40.00 per</td>
    <td><B>=</B></td><td>$200.00</td><tr>
    <td>Edging</td><td>20 lf</td><td>@ 1.50 per lf</td>
    <td><B>=</B></td><td>$30.00</td><tr>
    <td> </td><td></td><td></td>
    <td>Total Bid</td><td>$410.00</td><tr>
    <th colspan=5><B>What Percentages Did You Make?</B><tr>
    <th>Summary</th><th>ToTals</th><th>Percentage</th><th><B></B></th><th><B></B></th><tr>
    <td>Total Bid</td><td>$410.00</td><td>100%</td>
    <td><B></B></td><td></td><tr>
    <td>Material Cost</td><td>$200.00</td><td>48%</td>
    <td><B></B></td><td></td><tr>
    <td>Labor Cost</td><td>$36.00</td><td>17%</td>
    <td><B></B></td><td></td><tr>
    <td><B>What did you Make</B> </td><td>$174.00</td><td><B>35%</B></td>
    </td></tr>
    </table></B>
    <BR>
    <B>Is that good or bad? "Only You Know this" But you still got
    <BR>to take-out for your overhead from the $174.00...
    <BR>This is not intended to replace any personal skills
    <BR> or information you may be using now. It is only
    <BR>intended to help you with your judgement in your bidding.</B>

    [Edited by Clinton D. Wagner on 03-09-2001 at 02:49 AM]
     
  7. Groundcover Solutions

    Groundcover Solutions LawnSite Bronze Member
    Posts: 1,254

    WOW that helps alot!!!! You must have a littel time on your hands!!LOL
     
  8. joshua

    joshua LawnSite Bronze Member
    Posts: 1,226

    hometown, my bad i misread what you wrote thats why i was off in what i was saying. mr.wagner's chart is the real thing.
     
  9. Clinton D. Wagner

    Clinton D. Wagner LawnSite Member
    Posts: 45

    <TABLE>
    <B>Hi Hometown...I've got a minute or two!.. LOL..
    <BR>
    <BR>If I may, I would like to see if I could Answer your first
    <BR>Question:
    <BR>
    <BR>You Ask....."I was wondering what % of a job do you guys make. Like if i did a 1,000 dollar how much should i make for that. Any information would be great thanks."
    <BR>
    <BR>Just remember that This is not intended to replace any personal skills or information you may be using now. It is only intended to help you with your judgement in your bidding.
    <BR>
    <BR>Ok Here we go...</B>
    <BR>
    <B>The goal in pricing is to mark up the cost of your materials sufficiently to give you a large enough margin to cover all your expenses and still give you a PROFIT. Each company has got to work out and know what his gross margin is. It may be 26%, 30%, 40%, 50%, 60%, 70% and so on..
    <BR>
    <BR>
    There are a surprising number of landscape contractors who believe there are only two steps to the pricing process; add a PROFIT on the cost and then charge anything above this that the market will bare.
    <BR> Margin, or gross margin, is the difference between total job (total sales) and the cost of those jobs (or sales) </B>
    <BR><B> For Example:</B>
    <BR>
    <table border>
    <th colspan=5><B>Let's Say you sold a Job for 1,000 dollars</B><tr>
    <th> </th><th> </th><th> </th><th><B></B></th><th><B></B></th><tr>
    <td>Total sales of the job was</td><td>$1,000</td><td></td>
    <td><B></B></td><td></td><tr>
    <td>And the cost of materials was</td><td>$ 300</td><td></td>
    <td><B></B></td><td></td><tr>
    <td><B>Then Margin was</B></td><td><B>$ 700</B></td><td></td>
    <td><B></B></td><td></td><tr>
    </table>
    <BR><B>Margin may be expressed in dollars or as percentages, margins are always stated as a percentage of job (or sales) in the example above, the margin would be 70% ($700 is 70% of $1,000)</B>
    <BR>
    <B> if you purchased materials for $300 and priced them for sale at $1,000, your mark-up would be $700. This represents a mark-up of 233% ($700 divied by $300) in other words, if your business required a 70% margin in order to show a profit, which it should, your average mark up would be 233%. Here again, if the margin on sales is not significantly large, there will be little or no profit for the company or owner.</B>
    <BR>
    <BR>
    <B>Some businesses require a higher margin than others in order to be profitable. This is because the cost of operating is different for each contractor and can vary tremendously if the operating expenses in your business are comparatively low, then a lower margin will still yield you an acceptable profit. </B>
    <BR>
    <table border>
    <b>The following comparisons illustrate this point.
    <BR>
    <th colspan=5><B>Business "A" versus Business "B"</B>
    <tr>
    <th>Summary</th><th></th><th>Business "A"</th><th></th><th>Business "B"</th><tr>
    <td>Total Sales</td><td></td><td>100%</td><td></td><td>100%</td><tr>
    <td>Gross Margin</td><td></td><td>60%</td><td></td><td>35%</td><tr>
    <td>Operating Expenses</td><td></td><td>43%</td><td></td><td>19%</td><tr>
    <td><B>NET PROFIT</B></td><td></td><td><B>17%</B></td><td></td><td><B>16%</B></td>
    </table>
    <BR>
    <B>Many a business fails to make an expected profit because it's owner figures that if his mark-up is X percent then his margin will be X percent too. But we can readily see from the above preceding examples that such is not the case.</B>
    <BR>
    <BR>
    <B>I would like to review your above job....</B>
    <BR>
    <table border>
    <th colspan=5><B>You Said You Bid This</B><tr>
    <th>Materals Bid</th><th>QTY</th><th>Rate</th><th><B>=</B></th><th><B>Total Bid</B></th><tr>
    <td>Mulch/Bark</td><td>3 cy</td><td>@ 60.00 per</td>
    <td><B>=</B></td><td>$180.00</td><tr>
    <td>TopSoil</td><td>5 cy</td><td>@ 40.00 per</td>
    <td><B>=</B></td><td>$200.00</td><tr>
    <td>Edging</td><td>20 lf</td><td>@ 1.50 per lf</td>
    <td><B>=</B></td><td>$30.00</td><tr>
    <td> </td><td></td><td></td>
    <td>Total Bid</td><td>$410.00</td></tr></table>
    <BR>
    <B>Then you said.....</B>
    <BR>
    <table border>
    <th colspan=5><B>Your Material and Labor cost was this</B><tr>
    <th>Materals needed</th><th>Cost</th><th>X</th><th><B>=</B></th><th><B>Total cost</B></th><tr>
    <td>Mulch/Bark</td><td>30.00 per yard</td><td>X 3</td>
    <td><B>=</B></td><td>$90.00</td><tr>
    <td>TopSoil</td><td>19.00 per yard</td><td>X 5</td>
    <td><B>=</B></td><td>$95.00</td><tr>
    <td>Edging</td><td>15.00/45 lf</td><td>20 lf</td>
    <td><B>=</B></td><td>$15.00</td><tr>
    <td>Labor /3 men at 8.00 per hour</td><td>= 24.00 per hour</td><td>X 1.5 hours</td>
    <td><B>=</B></td><td>$36.00</td><tr>
    <td> </td><td></td><td></td>
    <td>Total cost</td><td>$236.00</td><tr></table>
    <BR>
    <B>Let's look at it another way...Let's say you know you've got to make 57% of your total bid price and you know that you've got to mark-up your materials (NOT THE LABOR) only materials, 233% in order to get your 26% Gross Margin...with that in mind...your material cost would look like this...</B>
    <BR>
    <table border>
    <th colspan=5><B>First Take off the Labor and show only material cost like this</B><tr>
    <th>Materals needed</th><th>Cost</th><th>X</th><th><B>=</B></th><th><B>Total cost</B></th><tr>
    <td>Mulch/Bark</td><td>30.00 per yard</td><td>X 3</td>
    <td><B>=</B></td><td>$90.00</td><tr>
    <td>TopSoil</td><td>19.00 per yard</td><td>X 5</td>
    <td><B>=</B></td><td>$95.00</td><tr>
    <td>Edging</td><td>15.00/45 lf</td><td>20 lf</td>
    <td><B>=</B></td><td>$15.00</td><tr>
    <td>Labor /3 men at 8.00 per hour</td><td>= 24.00 per hour</td><td>X 1.5 hours</td>
    <td><B>=</B></td><td>$00.00</td><tr>
    <td> </td><td></td><td></td>
    <td>Total Material cost</td><td>$200.00</td><tr></table>
    <BR>
    <B>But on this day you took the $200.00 for material and X's it by 205% and came up with $410.00 to bid</B>
    <BR><B>Now For Example:</B>
    <BR>
    <table border>
    <th colspan=5><B>Let's Say you sold the Job for $410.00 dollars</B><tr>
    <th> </th><th> </th><th> </th><th><B></B></th><th><B></B></th><tr>
    <td>Total sales of the job was</td><td>$410.00</td><td></td>
    <td><B></B></td><td></td><tr>
    <td>And the cost of materials was</td><td>$ 200</td><td></td>
    <td><B></B></td><td></td><tr>
    <td><B>Then Margin was</B></td><td><B>$ 210</B></td><td></td>
    <td><B></B></td><td></td><tr>
    </table>
    <BR>
    <B>The margin would be 21% ($210 is 51% of $410)</B> You are short 7% on your bid from the 57%, but if you only need 51% then you are OK ....</B>
    <BR>
    <B>But if you had took the $200.00 for material and X's it by 233% you would have came up with $466.00 to bid</B>
    <BR><B>Heres how it would have look:</B>
    <BR>
    <table border>
    <th colspan=5><B>sold it for $466.00 dollars</B><tr>
    <th> </th><th> </th><th> </th><th><B></B></th><th><B></B></th><tr>
    <td>Total sales of the job was</td><td>$466.00</td><td></td>
    <td><B></B></td><td></td><tr>
    <td>And the cost of materials was</td><td>$ 200</td><td></td>
    <td><B></B></td><td></td><tr>
    <td><B>Then Margin was</B></td><td><B>$ 266</B></td><td></td>
    <td><B></B></td><td></td><tr>
    </table>
    <BR>
    <B>The margin would be 26% ($266 is 57% of $466) You are now right on !!! if 57% is what you wanted to make on this job... </B>
    <BR>
    <BR>
    <B>Now how does this all come together with what "A" did versus what "B" did...</B>
    <BR>
    <B>"We did the work", now it's time to pay the bill's and see how we came out on the job...</B>
    <BR>
    <table border>
    <th colspan=5><B>"A" Bid</B><tr>
    <th>Summary</th><th>ToTals</th><th>Percentage</th><th><B></B></th><th><B></B></th><tr>
    <td>Total income</td><td>$466.00</td><td>100%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out for Materials</td><td>$200.00</td><td>43%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out for labor Cost</td><td>$36.00</td><td>14%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out in overhead cost </td><td>$84.00</td><td>36%</td>
    <td><B></B></td><td></td><tr>
    <td><B>What did "A" Net</B> </td><td>$146.00</td><td><B>Thats 31% of the total bid</B></td>
    </td></tr>
    </table>
    <B>Well how did bidder "A" do...if we add up the cost and the profits we can see that</B>
    <B>146 + 84 + 36= $266 dollars, $266 divided by $466= 57% of the total bid "He got what He needed"</B>
    <BR>
    <table border>
    <th colspan=5><B>"B" Bid</B><tr>
    <th>Summary</th><th>ToTals</th><th>Percentage</th><th><B></B></th><th><B></B></th><tr>
    <td>Total income</td><td>$410.00</td><td>100%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out for Materials</td><td>$200.00</td><td>49%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out for Labor Cost</td><td>$36.00</td><td>17%</td>
    <td><B></B></td><td></td><tr>
    <td>paid out in overhead cost </td><td>$84.00</td><td>48%</td>
    <td><B></B></td><td></td><tr>
    <td><B>What did "B" Net</B> </td><td>$90.00</td><td><B>Thats 22% of the total bid</B></td>
    </td></tr>
    </table>
    <B>Well how did bidder "B" do...if we add up the cost and the profits we can see that</B>
    <B>90 + 84 + 36= $210 dollars, $210 divided by $410= 51% of the total bid "did he get what he wanted? if it was 57% then No...he only got 51% (7% short of what he needed)</B>
    <BR>
    <B>But on the other hand we don't know just how many other jobs Bidder "B" had going that day that will help make up that 7%, maybe he had 2,3,4, or even 5 going with more than a 57% for them coming in..."After all He was only there 1.5 hours"</B>
    <BR>
    <B>What should you make if you bid a job for $1,000 ?, well what is your Margin........</B>
    <BR>
    <BR><B>Now note that in no way am I saying to bid by just doing a mark-up on cost of materials, but it is a good way to see if your bid is going to give you the amount you need to stay in the Biz....</B>
    <BR>
    <BR>
    <B>I think my minute is up....LOL</B>
    <BR>
    <B>P.S. When I was contracting I liked to get all my cost of materials, labor hours X rates, put on something for my overhead and then divide the total by 0.740740</B>
    <BR>
    <B>Example: materials $200 plus labor of $100 = $300 X 28% for overhead = $84.00 = total cost $384.00 divided by 0.740740 = $513.00 would be my bid, that gave me a 31% margin or I could say that I mark-up the job 2.565%, note $200.00 X 2.565 = $513.00 </B>
    <BR>
    <BR>
    <B>There go's my last minute...LOL</B>
    <BR>
    <B>Good Luck !!!</B>
    <BR>
    </TABLE>
     
  10. Guido

    Guido LawnSite Silver Member
    Posts: 2,085

    Thats all I have to say! Welcome to LawnSite Clinton! :)

    Great Web Site too!
     

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