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#158890 - 09/20/06 03:50 PM Variable Rates
Tiger Offline
Registered: 05/04/05
Posts: 706
Loc: Crystal Lake, IL USA
I was curious if anyone varies their rates on the "degree of difficulty" or experience required for an installation. In some peoples minds "anyone can do that"...changing recessed light trims, replacing light fixtures, etc. Some Darwin nominees even change circuit breakers.

It would be possible to vary rates, so the easy tasks would be priced less, and the really nasty jobs, like swimming in insulation in the summer, would be priced higher.

Anyone doing this or having comments on this would be appreciated (especially comments from residential service contractors).

Business, Office, Estimating, Legal:
#158891 - 09/20/06 05:16 PM Re: Variable Rates
Sparks30 Offline
Registered: 03/23/02
Posts: 125
Loc: Connecticut.usa
The only time I really change my rates is for doing small favor projects.
#158892 - 09/20/06 07:15 PM Re: Variable Rates
Jps1006 Offline
Registered: 01/22/04
Posts: 615
Loc: Northern IL
would you pay your guys different rates too then? That could complicate things a little.

Or you could have your highest paid guy bill-in higher rates and give him the tougher jobs.

Now, if you flat rate, or as LK puts it, contract price it, you just figure it up and add the hassel fee to a higher hourly rate. I do something similar to that all the time.
#158893 - 09/21/06 11:25 PM Re: Variable Rates
Wireless Offline
Registered: 06/09/05
Posts: 73
Loc: Los Angeles CA USA
If I am skilled for Job X why would I charge less to do Job Y? Don't I charge based on my skill level not the skill of the actual job?
#158894 - 09/22/06 08:50 AM Re: Variable Rates
mikesh Offline
Registered: 06/07/06
Posts: 613
Loc: Victoria, BC, Canada
Back in my earliest days in the trade I worked as an Electrical Mechanic. Our Labour rates were posted as $20.00/Hr. $30.00 if you watch. $40.00 if you help.
and we pointed this out and made sure the customer did not think we were kidding because we were not. It helped a lot in keeping our costs down both from the inevitable distractions and loss of borrowed tools. Still there was always the guy who insisted on paying $40.00/ hr.
#158895 - 09/24/06 05:19 PM Re: Variable Rates
Tiger Offline
Registered: 05/04/05
Posts: 706
Loc: Crystal Lake, IL USA
Thanks to all for your responses. I'm not looking to restructure my pricing system because of one do-it-yourselfer. I think my time would be better spent working for someone else.

#158896 - 09/24/06 05:52 PM Re: Variable Rates
renosteinke Offline
Cat Servant
Registered: 01/22/05
Posts: 5316
Loc: Blue Collar Country
That's the challenge of pricing.

Apart from the costs of material, costs of labor, and fixed overhead expenses, there are many things that influence pricing.

First of all, how bad do you want / need the work? Your schedule, the nature of the customer, and the nature of your competition all influence the price you give.

Are there special expenses involved? A guy who owns a boom truck can probably service street lights cheaper than a guy who has to rent one.

Who's the customer? A repeat customer with a habit of paying promptly is going to get a better price from me.... than an unknown with a rep for being slow and difficult to please!

Who's the competition? If I'm competing against the "A Team," I'm likely to quote more than if my competition is a semi-retired , marginally legal, trunk slammer. IF I want the work.

What other contractors are involved? If I'm going to be working with the Three Stooges... my price goes up.

So, despite all the software and books that attempt to make estimating a science, it's really an art. Kind of like welding- you can't learn it from a book!
#158897 - 09/25/06 08:00 AM Re: Variable Rates
iwire Offline
Registered: 01/05/03
Posts: 4391
Loc: North Attleboro, MA USA
The company I work for has different rates for different customers. In short as high a rate as the customer is willing to sign for.

They do not tell me the rates and that is fine with me.

A licensed guy is billed out at the same rate as an apprentice.

Occasionally customers will not accept that so instead of charging say (made up numbers) $75 for each, they will be charged $50 and $100. either way the cost for two guys for one hour is the same.
Bob Badger
Construction & Maintenance Electrician
#158898 - 09/25/06 06:20 PM Re: Variable Rates
ExpressQuote Offline
Registered: 04/27/06
Posts: 83
Loc: BC, Canada

It makes sense that the Jman and apprentice are charged out at the same rates, if they use jman labour hours to determine how long the job will take.

If a jman can do the project in 4 hours because of experience, the apprentice will probably take more. The relationship between the apprentice's experience and the time it takes for him/her to do the job should be fairly proportionate to the hourly rate of the jman.
#158899 - 09/25/06 06:27 PM Re: Variable Rates
mahlere Offline
Registered: 11/17/05
Posts: 507
Loc: New Jersey

i'm not following you. if a jman and an apprentice are billed at the same rate, how does that work out?

for example. both billed at $100/hr. Jman takes 4 hrs = $400 labor. Less skilled apprentice takes 5 hrs = $500 labor.

am I missing something?
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