I have some commercial customers who prefer to purchase all of the materials. I let them know up front that my hourly labor rate is $45.00 per hour when I supply all materials and $55.00 per hour when I do not. I haven't had anyone argue with this arrangement.
Residential customers would probably throw a fit over something like this but commercial/industrial customers are more apt to understand that my hourly rate is much more than wages. It covers the cost of wear and tear on tools and equipment, insurance, fuel, vehicle costs, taxes and lost time. It's hard to get 8 billable hours in a 12 hour day. When I work for a commercial account who is supplying materials I start the clock when I get there and stop it when I leave for the day and subtract what time I took for lunch if I took any. I had this arrangement at a small manufacturing company where I worked every day for 21 months. They said that $55.00 per hour was a bargain. They figured it would have cost them $72.00 per hour for wages, benefits, their half of SS, tools and equipment and safety training. Then they would have to worry about retaining that employee. They also limit their employees to a maximum of 54 hours a week. I had to work many 60-70 hour weeks to meet construction schedules. It was a good gig for me and a real cost effective solution for them.
