subcontract percentages

Discussion in 'Business Operations' started by Matthew Morgan, Nov 27, 2001.

  1. Matthew Morgan

    Matthew Morgan LawnSite Member
    Messages: 45

    I have someone who is interested in doing my applications for me. I have never sub-contracted work before. I am speaking with my attorney about a contract and protection from solicitaion, but I am unsure about what percentage of the job I should keep. My only responsibility will be scheduling and billing the customer.

    Any advice would be helpful. Thank You!

  2. cp

    cp LawnSite Senior Member
    Messages: 263

    Some say 20%.

    I have gotten as high as 40.
  3. HBFOXJr

    HBFOXJr LawnSite Bronze Member
    Messages: 1,712

    I think 20% is the minimum and up from there. I t may seem like gravy to make 10-15% but if your substituting someone else's labor for your company labor that normally helps recover overhead and earn a profit you need more.
  4. Guido

    Guido LawnSite Silver Member
    Messages: 2,087

    but the higher end of that is probobly hard to do unless your not being charged premium prices for their services. How much of a lower rate are they planning on giving to you in comparison to a regular customer since you will be doing all the "back office" work?
  5. Henry

    Henry LawnSite Senior Member
    Messages: 548

    I started subbing out my apps this year and I add 30% to the price I'm charged, some higher. The lawns look better than when I did it myself and I don't get any complaints. This company doesn't do anything else so I'm not concerned with them trying to take work from me.
  6. Lanelle

    Lanelle LawnSite Bronze Member
    Messages: 1,361

    When sub-contracting, be sure to get certificates of insurance from each sub-contractor and proof of workman's comp. insurance. This will save you money and potential grief later. Also for the chemical apps., be certain that the person has current pesticide certifications in force. If you are going to be using this applicator for lots of work, make a deal for a lower price so you can add a better margin for yourself.

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