It may be the dumbest question of all, but I’m really having some hard times with it: How much to charge for each job?
I’ve been working some time as an employee, for a salary; and the last three years mostly in IT (server rooms and power quality). Now I’m starting an electrical contractor business, and I’m founding that price setting is my number one problem!
For example, I’m quoting a 200 amps upgrade for a one family house, from external service entrance cable to the new panel and ground rods. I’ve seen some prices around for similar job descriptions from 18 to 36 hundreds; is there a reference criterion? Do electrical contractors in New Jersey have some kind of “price fixing”?
In my area of NJ a single truck operation, with just one man, in order to make about 8% profit which is very little, and that depends on the job running without any problems, it would be anywhere from $2000-$2400 and up. what grade of material?, what type of workmanship? What kind of job conditions?.
There are job conditions that vary the price, any bends in the service feed, what type of ground conditions for the rods, good soil or bed rock, or could there be shale there, How about the GEC, how far and under what conditions will you run it, How many circuits will you be installing, and what conditions are you working in.
I noticed your profile does not say electrical contractor, are you just starting in business? , Once you join the ranks of contractors, and find what your real payouts are, just to open the doors each day, you will find, the one thing that is fixed, and that is your overhead, and operating expenses.
[This message has been edited by LK (edited 12-26-2005).]
I just got done replacing an older GE Al buss panel with a new Seimens 200A CU buss panel.
Parts & labor about $600.
Of course, this isn't my regular price - the guy is a long time family friend who's helped me out numerous times in the past, so I only asked $10/hour & no markup on parts- he gave me about $30 all said & done.
A 100>200A upgrade? Going rate in Northern IL is $1200-1800, depending on variables.
Around here, a 200a. service change will run around $2200.00. The best way I can help you in your pricing problem is to tell you to start off charging hourly for as much work as you can.there's really no way to get hurt on Time and Mat. as long as you remember to charge for the running around each job requires and as long as your hourly rate is high enough to make the job worth your while but low enough to be competitive. Around here, the average rate is about $85.00 per hour. I say average because every EC has their own way of reaching that average. Some charge $150.00 for the first hour and $70.00 for every hour thereafter, some charge a flat rate but include atleast 1/2 hour travel time, etc. Basically, you need to know how much you can get away with charging and still get the job. Charge as much as you know the market in your area will support. The only other advice I can give is not to try to push to get too big too fast. Stay small and let the business force you to expand. Don't charge all your mat. in bad times. If work dries up, the last thing you want is an unexpected monthly bill from a wholesale house. Keep your overhead down and your profits up. Good luck
that's it. don't charge what you can get away with, charge what you need to charge to make money.
if you need $600/day to cover costs and make a profit, a going rate of $55.00/hr will only put you out of business slowly. the more work you do, the quicker you will go out of business.
the only way to price yourself for success is to know your costs. don't call around or look at other contractors pricing for help, most guys don't know their costs. they just charge what the market says to charge. then they wonder why there is no money to be found at the end of the year.
if you don't know your costs or don't want to learn what they are, go back to working for someone else.
btw, i'm about 45 south of you in NJ and I know your area well.