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how do you figure the cost per hour on your equipment?

Discussion in 'Lawn Mowing' started by lawnwizards, Mar 16, 2006.

  1. lawnwizards

    lawnwizards LawnSite Silver Member
    Messages: 2,439

    for the past 3 years i've just tagged hourly numbers to run my equipment. ex: $10.00 an hour for walkbehind. this year i want to figure the exact cost(or as close as possible cost) to run my equipment. does anyone have a system they use that they can show me? thanks.

  2. Toro 44

    Toro 44 LawnSite Member
    Messages: 155

    I don't have a system. But I sat down and figured up all the stuff I bought for my mower over a two year, 600hr period. You know gas, belts, oil, parts, blades etc. I projected the initial cost of the mower out over say five years. This gives you numbers to play with. Interestingly, for my old toro 44 belt drive, I came up with $9.00/hr plus change. I wouldn't call it precise, but it gave me a good idea.

    Incidentally, if you figure the cost of replacement belts every year vs. hydro oil and filter every year and the increased productivity of a hydro, running a hydro is less expensive.

    hope this helps some.
  3. lawnwizards

    lawnwizards LawnSite Silver Member
    Messages: 2,439

    what about your truck costs? i'm trying to figure that out as well...
  4. Toro 44

    Toro 44 LawnSite Member
    Messages: 155

    me too. :laugh: :laugh:

    I just bought a different truck. I was taking mileage on the old one, which is a total an complete rip off. It's much better to keep track of all the money you spend keeping that truck running. You get a much better write off. At least I do. At $.35/mile or whatever, and the few miles I put on in my tight route, the write off barely covered my ins. never mind gas, repairs, depreciation, etc.

    It's a lot of work, but keep every receipt and write down your expenses on a ledger. You can keep separate ledgers for mower, truck, etc. Take what you have spent, and what you loose in depreciation, and divide it over the mileage you have accumulated so far. That'l give you a rough per mile figure.
  5. Richard Martin

    Richard Martin LawnSite Fanatic
    Messages: 14,699

    I'll do my Dixie Chopper for you to give you an idea of what I do.

    I expect the mower to last for 4,000 hours before it must be replaced. At that time I expect new Dixies like the one I have will be in the $12,000 range. Divide 12,000 by 4,000 and you get a per hour cost to replace it of $3.00 an hour. That is a fixed cost that would only change if the price of Dixies is not what I expect them to be.

    My Dixie burns in the neighborhood of 1 gallon of gas per hour at today's price of $2.50 for mid grade. So fuel costs me $2.50 per hour.

    I change the oil at 50 hours for a cost of $4.00 for 2 quarts of 10w30. That comes to 8 cents an hour.

    I change the filter at 100 hours at $5 a pop. 5 cents an hour.

    Blades last me about 75 hours at $36 for 3. 48 cents an hour.

    Prior experience with Dixies has told me I can go 1200 hours on a set of belts. All 3 belts run about $100. 8 cents an hour.

    I can also get in excess of 1200 from the tires but I'll say 1200 just for grins. Front ands rears mounted on new rims cost me $300. 25 cents an hour.

    1 air filter, 1 Amsoil bypass filter and 1 fuel filter run me about $70 a year at 300 hours. 23 cents an hour.

    Grease and other misc costs are about 25 cents an hour.

    Now I'll throw in an extra $2,000 over the life of the mower for unexpected repairs like a complete hydro failure (not likely) or something silly like that. $2.00 an hour.

    Add those per hour costs up and I come up with $8.92 an hour to operate the mower and that includes replacement costs. These costs go up if you trade or sell your machine before you wear it out because the mower's actual depreciation does not move on a lateral line, it moves on a curve with the greatest depreciation occuring within the first 50% of a mower's expected lifespan.
  6. Toro 44

    Toro 44 LawnSite Member
    Messages: 155

    Excellent post. Thanks for taking the time to break all that down. When I projected the cost of my toro, I figured a transmission replacement and engine replacement just for good measure.

    I can't believe how cost effective a dixie is. Actually it's even $1.50 less expensive than what you figured. $2,000.00 over the life of a 4000 hr machine is actually $.50 an hr. Your saving money you didn't even know about. :laugh:

    Seriously I'm amazed because it seems like it costs the same or even less to operate a dixie chopper than it does to operate an average walk-behind.

    cheers:drinkup: :drinkup:
  7. MMLawn

    MMLawn LawnSite Gold Member
    Messages: 3,569

    Don't forget that you need to include the cost of the mower itself (unless it was free lol) either spread over the life or expected life or the time you expect to keep it and the cost of the/any insurance you have on the mower and the part of your business/county/city/local property taxes on the mower.
  8. jtkplc

    jtkplc LawnSite Silver Member
    Messages: 2,656

  9. Flex-Deck

    Flex-Deck LawnSite Silver Member
    Messages: 2,845

    I like the posts here, but to keep it simple, I take .01% of cost of machine - ie - $10,000 machine = $10 per hr covers everything etc.
  10. LwnmwrMan22

    LwnmwrMan22 LawnSite Platinum Member
    Messages: 4,373

    Pauly fan - Richard Martin did include the cost of the machine, right at the beginning he said $12k spread out over 4000 hours.

    However, I disagree with his post that if you trade early, the costs goes up.

    It's going to depend on how soon you reach that 4000 hour mark, OR what your residual value is in your mower.

    If you just junk it out, there's very minimal value.

    However if you trade at 1200-1500 hours, that mower is still worth $5000-$6000, so your next mower is going to theoretically cost you $6000, or $1.50 / hour, therefore dropping Richard's cost from $8.92 / hour to $7.42 / hour.

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