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#158582 - 07/08/06 09:49 PM How do these guy's do it ?  
HCE727  Offline
Member
Joined: Nov 2005
Posts: 186
Delaware County, PA, USA
I saw an estimate from a local company that is fairly big. Replace about 30' of 100-amp service cable, one ground rod, permit and inspection. Total was $2,075.00, unbelievable! How do these guy's do it and how much work do they get? This was in Willow Grove, PA, a suburb of Phila. If I gave an estimate like that, I would probably be shot!


Hank

Business, Office, Estimating, Legal:

#158583 - 07/09/06 06:30 AM Re: How do these guy's do it ?  
mahlere  Offline
Member
Joined: Nov 2005
Posts: 507
New Jersey
look into nexstar, esi, etc. You'll find out how they do it. It's a completely different business model than most small companies work off. If it's the company I am thinking of, they spend roughly $20-25k month in yellow page advertising. Offer quick service. Same day installations/repairs. Like LK said, they'll be there at 1:30a on a winter night.

It's the difference between a service company who does it to make a profit, and an installation company who does service to fill in slow spots.

And no, you wouldn't get shot. You just couldn't give those prices from a beatup van, wearing a t-shirt and jeans with holes in them (no insinuating that you have either a beat up van or holes in your jeans [Linked Image] )


#158584 - 07/09/06 08:11 AM Re: How do these guy's do it ?  
HCE727  Offline
Member
Joined: Nov 2005
Posts: 186
Delaware County, PA, USA
This job is clean cut, it is not an emergency situation, easy access. remove the meter, cut the taps, remove the old cable, install the new cable, tie it in to the meter and panel. the hole for the service cable in the foundation is clean. For the sake of argument, 4 hrs. tops. I am all for making a profit. but come on. Maybe I shouldn't complain, they make it better for me.


Hank

#158585 - 07/09/06 08:12 AM Re: How do these guy's do it ?  
HCE727  Offline
Member
Joined: Nov 2005
Posts: 186
Delaware County, PA, USA
This job is clean cut, it is not an emergency situation, easy access. remove the meter, cut the taps, remove the old cable, install the new cable, tie it in to the meter and panel. the hole for the service cable in the foundation is clean. For the sake of argument, 4 hrs. tops. I am all for making a profit. but come on. Maybe I shouldn't complain, they make it better for me.


Hank

#158586 - 07/09/06 08:46 AM Re: How do these guy's do it ?  
mahlere  Offline
Member
Joined: Nov 2005
Posts: 507
New Jersey
HCE,

I'm not saying anything about their price, other than what are their costs to provide a service atmosphere?

Like I said, if it's who I'm thinking of, their YP bill w/ Verizon is $20-25k/month. Add their overhead, and they are probably $300-$350/billable hour. I'd be willing to bet that their monthly nut is close to $60k just to keep the lights on.(trucks, insurance, advertising, etc - not including labor)

Figure the material at 2-3x cost.

Since it's an employee, while you might do it in 4, he'll probably take 6. thats $1800-$2100/labor & OH, add in parts, and there you go.

Now, it might not be an emergency situation, but if their target level is $300/billable hr, then that's what it is. On an average day, they are lucky to get 4 billable hours. But they still have to cover labor and OH for 8 hrs. 4 hrs billable at $300/hr is only $1200. Not exactly a killing. Now, if you can consistantly generate $1200/hr and have 20 trucks on the road, not bad.

but considering that a friend of my family owns 5 burger king restaurants and takes a personal income of $1.5 mil/year. And burger kings only redeeming qualities are fat americans and a new relatively funny marketing campaign, and I lean towards BK being a true ripoff.

It's really about perspective. BTW, what does the POCO there charge for a D&R? Here it's $212 just to come out and cut and rebug the point of attachement. We do it legally all the time, should we do it for free? Why shouldn't we get the same $212 as the POCO. Are we not taking a risk with our lives every time we do one?


#158587 - 07/09/06 11:49 AM Re: How do these guy's do it ?  
HCE727  Offline
Member
Joined: Nov 2005
Posts: 186
Delaware County, PA, USA
I understand that, Mahlere. I wonder how many jobs they get, after they give an estimate. Are they counting on all jobs to be emergencies? It seems to me that people are always getting 2 or 3 estimates.


Hank

#158588 - 07/09/06 01:59 PM Re: How do these guy's do it ?  
LK  Offline
Member
Joined: Jan 2003
Posts: 1,429
New Jersey
Don't worry about the ones that got away, worry about the one you caught, and don't let it jump back in the water.

Service calls, and repairs, have a heaver overhead burden, if your planning on doing service work only, your cost of doing business will be 2 to 3 times more.


#158589 - 07/09/06 02:40 PM Re: How do these guy's do it ?  
mahlere  Offline
Member
Joined: Nov 2005
Posts: 507
New Jersey
Look at this way HC, say you were going to do the job for $1000. You have the same material costs (lets say $200 for arguments sake)

You both go on 4 estimates - each estimate costs you $50 in real money (direct labor, etc)

They sell 1/4 - $2000 - $200 mat - $200 est cost = $1600.

You need to sell 2/4 to get the same gross, but your costs are like this:
$2000 -$400 mat (u did 2 jobs) - $200 est cost = $1400.

Now, they are paying for 4 hrs labor (for arguments sake), but you are paying for 8 hours labor (remember you did 2 jobs)

Don't disregard overhead either. Who has the higher overhead?

At the end of the day, who makes more money? Who did more work?

again, look at Nexstar or ESI and you'll find most of the answers you are looking for.


#158590 - 07/09/06 10:13 PM Re: How do these guy's do it ?  
HCE727  Offline
Member
Joined: Nov 2005
Posts: 186
Delaware County, PA, USA
Forgive my ignorance, but what is Nexstar and ESI?


Hank

#158591 - 07/10/06 11:18 AM Re: How do these guy's do it ?  
trevman  Offline
Member
Joined: Aug 2005
Posts: 47
canada
It doesnt seem to me that the price for that is to far out. Im just starting out with my own company and I havent been very succesful with my estimates so far but Im still learning. I refuse to do jobs unless it covers my calculated hourly rate. I have also been calculating my hours based on the amount of time it takes for a employee to perform the work rather than how long it would take me to do it. I have noticed since going into business for my self that I am much more productive than when I was a employee.If you can't make good profits than why bother.Mahlere is there really any job that you would bid 4 hrs? Seems to me nothing can be done in 4 hrs. I havent been very busy but every job I have done so far has been quite profitable.


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