Current rates $$$$$$

Guys,

i've been around for a long time now and watched the scene.  a bit of advise.  Yes, most of you are too cheap.  The hourly rate is purely a guide to what you should make on average.  But it should not be the code by which you live and die. 
The customer is not really interested in the hourly rate, but that is the only measure you give him to compare you with others.  What the customer really wants to know is.  How much is it going to cost to get the job done? 
Not always, but mostly, you should be quoting per hole or metre or per job.  Take a punt and try it.  You have a fair idea what time it will take.  You've done the same jobs many times.  Tell the customer what he wants to hear.  He has no idea how many hours it will take.  He really wants to know a total cost and if you do it quicker, he doesn't care.  If it happens that you underestimate, shutup and learn for next time. The Dingo ran cheap and all it cost you was the experience.  Give yourself the opertunity to make real money.  No-one has ever worked out how to make more chargeable hours in the day.  But you can make more money by using your brain instead of your hands.  Simply give the customer what he wants. 
Almost always, once he has the job done for an acceptable and previously agreed price, he'll get you back again next time.  However, if you had quoted hourly and it took longer than HE thought, even though it was about what you thought,  you are unlikely to hear from him again.
Gary.

I can see both sides of the fence on this one. (Does that mean I'm sitting on it? ) For the most part I think hourly is the way to go, but there are times that per job works great.
I had a situation a few years back where a builder wanted a per house price for drainage trenches. Because I knew I'd be travelling a bit, and variable situations, I went in at 2hrs + 1 travel, per house. Made good money on every single one, as not one ever took 2hrs. Even had an occasion where we done 7 houses in one street. Was finished and packed up by lunch time!      

Whereas on the other hand...Had a job last week that I was waiting for the 3hrs for the topsoil to arrive. I was onsite for a total of 6 1/2hrs. Would have lost out on that if I was doing per Sq metre or m3! Instead I was payed to watch that cutie hanging the blinds inside. 

Then you've got the punters that only tell you half the job before you get there. What do you do when you've said "Yeah mate, we can level around your pool ready for pavers for $308 (3hrs+1 Travel)", then when you get there, and he sees how well the Dingo gets the job done, there's the ol' "While you're here, can you just.....and then could you....."      I hate those ones! Always when you've tee'd up a game of golf and you've got no smoko or water on board!    

Last edited by "The Guru" (2010-04-22 17:32:45)

Pretty much exactly what I STILL do Shaun. See I did pay attention whilst you were mentoring me. Once again thanks buddy, I owe you heaps. We WILL get up there to visit soon...Promise!

Totally agree with your comments Shaun. I run a pretty tight ship re outgoings. Just finished doing my invoicing for the week so YTD figures are up to date, and I can tell you that ATM I am showing 66% profit. Turnover is as I expect it to be, so pretty happy. Still can't tell you where it all goes though!

LOL    Yeah I should have edited that bit. I realised my figures don't actually include machine & truck payments and a few other things that the accountant deals with. 66% is a tad high me thinks....FEELS more like 10%     

Thats what I love about this forum.  I can always get a laugh.
Gary

Garys on the money here guys.
An old bloke told me once, "Its not how much it costs, it's how much is it worth?"

When you go to quote a job, dont ever tell them your hourly rate as your quoted price!!!!!

Your hourly rate should be "YOUR LOWEST RATE" of pay for the day! Not your average $$.

Instead, hone in on what you will do in his castle, then while you walking around his $$$$$$$ Castle ask yourself how much would this guy pay to have this work done! Try and ask him more questions than he asks you, like what he does for living? Find some common ground that you can relate with and offer an estimated cost only! Estimated cost allowing some time up your sleeve for set backs.
If the job takes you longer due to your bad judgement, cop it sweet! Guaranteed you will win more then you lose!
Try it next time you go for a quote, you may be quietly surprised!

Happy Hunting!

Last edited by BigFella (2010-05-06 22:28:24)

Hi Guys,
I went off on a bit of a wobbly last time this came up and sure enough, I can't not do it again. I've been charging $100 p/hr inc for the last couple of years now, this is done without batting a eyelid or hesitating at all over the phone or face to face. Now I've been wondering for the last couple of months or so wether this is too cheap, as I used to be at the top end with my pricing, but some of my new private customers have said that I quoted cheaper than some of the others, significantly in a couple of cases. This cannot continue! Every time somebody rings and asks how much, I tell them heaps! It's good for a laugh from the customer as well and sorts out the discount kings from the ones who want a quality job. I have far too many trade customers which causes me all sorts of greif with everybody wanting their job done tomorrow, you know what it's like. But I've said it before, if you are too cheap you will go broke, just not straight away. If you are only on $60 and hour and you increase your rate by $20, you are effectively doubling your take home pay. I had a bloody awful day yesterday where I managed to break my excavator, I can't admit on a public forum what I did but it involved serious brain fade and has resulted in a squashed seat and a bent conrod from the engine running inverted. I'm probably going to have to buy a new one (no s**t it's works out cheaper in the long run). I run a serious business which charges serious money so that when this sort of drama happens there is no banking hassle, I can just go and do it. It won't stop my wife from killing me, but the fact remains the costs of this business can be crippling at all the wrong times so please do your selves a favour and charge what you are worth. At $60 and hour you can earn more money at Coles.

Regards,
Richard Young
www.dialadingo.com.au