$$$$$$$$$$$ Per Man Hour

Discussion in 'Lawn Mowing' started by lawnman_scott, Jan 2, 2004.

  1. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Messages: 7,547

    I spent my time on New Years Day to figure my rate per man hour. This has been discussed at length here, and I am curious. It seems that if you dont say you make the magical, dollar a minute, people say you are undercharging, or working for free.
    It seems to me that this would vary on cost of living, and what the market would bear. I think that pricing confuses those that are new in the business.
    For instance, I run one crew, 3 people (including me), and two in the winter, (including me). The hourly rate this year was $36.03 per man hour. Not billable hours, not per crew not............, just good old man hours. Now if I were to say i dont do anything for less than $60 per hour, I would probably make next to nothing.
    I have stated before, that cost of living plays a part in what you make, someone making $100,000 may live better than someone making $125,000. Depends on the market.
    If I could get $60 per man hour here, I could buy a house for $140,000, and pay cash.......every year.
    So, making $36.03 per man hour, am i charging enough? or too much, or just right?
  2. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Messages: 4,899

    You Happy with that amount? If yes then its enough. No, then you need to charge more. And I did not spend New yrs day figuring it out. LOL

  3. dvmcmrhp52

    dvmcmrhp52 LawnSite Platinum Member
    from Pa.
    Messages: 4,205

    I think I'll stay out of it this time!:eek: :laugh:
  4. 4evergreenlawns

    4evergreenlawns LawnSite Member
    Messages: 107

    I have found that the man hours thing just never seem to equal what most say they are do. It is just like the everlasting rule of a 2 man crew should be able to cut four houses a hour and an average of $22. per hour makes you $88.00 so if the crew works 8 hours they will cut 32 house a day. What about drive time from the yard to the first job, what about gassing up, what about drive time from the last job to the yard and so on. This never works out. Same with the $60 per hour thing.

    So I like it better when I look at my overall margins. What do I want to make on jobs. Lets say sod. I want to make 25% on every sod job I do. That is what I want the company to see after all direct and indirect cost none of I am happy with $500.00 a day. Just as an example.

    With snow plowing and salting it is hard to tell what your man hours rates are going to be due to the use of seasonal contracts. I look for the year end numbers. If I can keep the company at 45% to 50% profit margins I am happy. Actually very happy. I am not sure if I am make a buck an hour, but I know I am making money sitting here doing nothing when it is not snowing.

    Not sure that helps but just what has made me happy with what the company is bringing in.
  5. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Messages: 7,547

    Well i look at per hour rate, but everyone boosts theirs to make themselves look like a "professional". Just do the math, and you will wonder why they dont all pay their houses off cash, in a year. Thats really the point of the thread. I like to debate, and when its in black and white, the numbers dont match.
  6. bastalker

    bastalker LawnSite Senior Member
    Messages: 965

    LMAO!!!:laugh: :D
  7. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Messages: 1,912

    I'd say your doing very well .... since the industry standard is $35 per hour on just maintenance .... but it does depend on your how much per hour you total operational cost is per hour

    Believe me or don't believe me .... but if everyonhe was making a TRUE $60 per hour I'd be driving a Porsche ... think of it the average Full timer is bout 2000 hrs per year that would be $120k income from just 1 employee ....

    We are very close +/- few $$ per hour but I can say my operational cost per hour is between $22 & $28 per man hour …. NO reason fore me to give out my actual number but this does included my salary .... this is total cost as my average hourly rate is just a little over $11 per hour

    Fore me I used just over 8000 man-hours in 2003 n I wish I had $480K in Gross income ….This is not to say that I don't have jobs that I don't make that .... as I have jobs I make more than that on

    Look at it this way .... say in ones' normal week they had direct labor of 20 hrs n made $1200 dollars on that .... the other 20 hours no income producing work was performed .... in most peoples minds they made $60 per hour BUT in my mind they only made $30 per hour ... as hours of potential income did not occur

    I need my guys working full time as Overhead cost still occur even when work is not being performed such as rent for facilities, utilities, advertising, property taxes, storage, insurance on buildings, office expenses and other "behind the scenes" costs … even some indirect cost are wasted …. If that $8K Z is not mowing … I’m losing $$

    Granted fore those content with only working 20 hours for $1200 that is real good money long as your other job you made money on the lost hours of potential money making man hours

    I know solo's doing this ... but the minute you add employees everything changes ... the way I like to look at it is ... of every employee I have ... I make around $5 to $7 for each hour they work ... so if they worked 2000 hours that guy made me $10 to $14K extra personal income .... as I grow an am able to add employees due to more work .... I make more $$

    Those working full time 2000 hours a year n pulling $120K per year ... I say killer I wish I could do that ... n for those working only 1000 hours per year with $60K I'd say awesome
  8. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Messages: 7,547

    NO, if we were making $60 per hour, your wife would drive that peice of crap Porche, you would drive a bentley like me............if i was making $60.
    Back to reality, i just hate to think what some new guys think when they figure what they are making.
  9. workaholic

    workaholic LawnSite Senior Member
    Messages: 260

    This is the formula I use on trimming ,mowing & blowing with 1 employee & myself. 40.00 per hour employee is paid 10.00 per hour subtract employee rate + BUSINESS costs= 24.00 PER HOUR .We do not use this formula on maintenance jobs, Mulching, or landscaping. Mowing only; we also have minium prices of 25.00 or we just dont mow it.
  10. WeatherMan

    WeatherMan LawnSite Senior Member
    Messages: 692

    :confused: :eek: :blush: :dizzy:
    =:cool2: payup

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