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Figuring your hourly cost of equipment

Discussion in 'Business Operations' started by Guido, Sep 25, 2001.

  1. Guido

    Guido LawnSite Silver Member
    Messages: 2,087

    Just figure roughly how much you use it each week......the numbers don't have to be exact.
  2. kris

    kris LawnSite Bronze Member
    from nowhere
    Messages: 1,578

    We do this..

    Personally I don't think it matters if it is being used or not..if it is on the job you have to acount for it..

    example only... if I figure it cost $5.00 per hour for the truck... the job takes 1 hour to mow....15 min travel .... truck is charged out at $6.15 and is added.
  3. Island Lawn

    Island Lawn LawnSite Senior Member
    Messages: 632


    You're doing a great service here!

    I've got my Equipment Costs per hour figured the same way.
    I alotted 1250 hrs for my eXmark. Just an educated ballpark guess. Now you've got me considering decreasing that seemingly arbitrary figure.

    It seems I have put more effort in researching my costs than my hours. That fact decreases the confidence I have in my entire formulations!
    ...but it's better than nothing.

    I have wondered about "replacement costs".
    Anticipating expenses rather than simply reacting to them.

    kris, I have often wondered about "if it's on the job, we have to account for it".
    But, I was taught to break down the hourly cost of each piece of equipment. It is a variable cost that is dependent on the tools used to do the job.
    I would like to hear more input about this.

    Equipment costs per hour
    Overhead costs per hour
  4. kris

    kris LawnSite Bronze Member
    from nowhere
    Messages: 1,578

    True Island Lawn,

    I was referring mostly to the maintenance crews where it is almost always same equipment going out on the truck daily.

    Also I refered to the truck... we have the cost figured per day and that needs to be accounted for in each site we visit. So, it is broken down to so much per hour we need to recoup that moneys.
    typical estimate may go something like this.... ( made up numbers here)

    property is 5,000 square ft.... can mow 2500sq/ft per hour = 2hours
    1 man mowing=2 hrs
    1man trimming=2hrs
    travel= 30 min. ( 2 guys 15 min )
    total 2.5 hrs x hourly rate needed to cover overhead etc.

    truck 2.5 hrs x whatever that truck costs you
    mower & trimmer, blower 2 hrs x whatever those costs are
    add last section with first plus whatever % profit = per cut rate x so many cuts per season= x amount of dollars then add last section divided by however many months = per month rate

    (last section)fert. spraying ,cleanups if you want or bill separate =
    whatever for season

    probably missing something here as it is late but hopes this gives you a bit of a idea how I bid maintenance jobs
  5. grassyfras

    grassyfras LawnSite Bronze Member
    Messages: 1,475

    quick question i hope i dont get off topic, but what if you were to use a smaller sized echo blower suchas a handheld would this reduce the amount of cost per hour of would the less purductiveness of the blower cost you more.
  6. Guido

    Guido LawnSite Silver Member
    Messages: 2,087

    Overall, the smaller blower would probobly hurt your bid (not that much) but when you start talking about other equipment it will be much more noticible.

    If I were talking to you it would be much easier to explain, but I'll try typing it accross the best I can.

    People that use just a 22" mower have much less maintenance costs than someone using a 60" more right.... BUT they are much less productive on large jobs. To bid the job for a profit with the 22" you would have to charge much much more than someone who is using a 60" cut thats faster and wider so he can be in and out of there in no time.

    You know what I mean?? If not let me know and I'll try to explain it better for you.

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