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.Originally posted by kris
Dennis ...Im curious. How did you come up with the 3 x formula?