I've posted almost the following before almost verbatum but here it is again:
Operating costs for a one man operation. Note, these are "real" costs:
1. A good family medical program - $700 per month minimum.
2. Vehicle, gas, ins., payments, depreciation, tires, tune up, repairs, etc. - $670
3. Office supplies including stamps - $30
4. Acct and attorney, if and when needed - $50
5. Magazines and books $40
6. Business taxes - $100
7. Telephone - $50
8. Cellular phone - $100
9. Travel & entertainment - $50
10. Seminars and Trade Shows - $125
11. Uniforms - even just jeans and shirts - $45
12. Small tools - $15
13. Software and upgrades - $30
14. Marketing & Advertising - $200
15. Office Equipment depreciation - $75
16. Liability Insurance - $300
17. Workers Comp OR Disability insurance - $125
18. Bad Debt - $100
19. Guarantee work $100
20. Future Capital Expenditures - $100
21. Owners draw ($1000 weekly) - $4333.00
22. Bookkeeping - ($150 per week) $650
That comes to about $7950 per month. Anything less and you're kidding yourself. Divide that by about an average of 32 "production" hours per week at 46 weeks for a total of 1472 man hours per year, or about 122 man hours per month. Divide that $7950 by the 122 hours and you get $65 per hour - COST of doing business. Add the profit you want.
The overhead cost items listed above are far from being excessive, but are realistic as to the true cost of operating, it you want to treat yourself as a legimate business owner. I don't see how anyone can operate without charging anything less than a minimum of $70 per hour.
Charge that and you still don't get the paid sick days, vacation days, paid holidays, pension or 401K, or any of the other perks you had when you just had a job.
