ECN Forum Forums General Topics of the Trade General Discussion Area Cost Plus 25

Reno, my materials last year were @150K, the 35% mark-up is @ 60K.

That's very important to me.

This is a average I shoot for, sometimes I can double or triple the cost of something. Sometimes I can only "squeeze" 10%.

I sell material, I sell advise, I don't care.
It makes money.

Lear, I know the 35% may be low, but when your still small, you can't price yourself out of the market., but I'm still learning...

Dnk....

DNK ~ I hear ya brother. Though we aim for the 50% sometimes we just can't get there. For large expensive stuff (like a $5K Xmfr) our M/U is only 20%. For wire nuts, cable, recept's, ballast,s and the like, we try hard to keep the M/U at 50%. On a side note, do you [or anybody] have a fuel surcharge??
Bill

Lear, no on the fuel surcharge. Keep the traveling down now and having more things delivered...

Dnk..

Dnkldorf,
"my materials last year were @150K, the 35% mark-up is @ 60K."

from this $60 are you deducting state taxes, storage cost, cost of material stocking and movement, inventory time, billing time, time spent purchasing items, special order items, and delivery costs.

That $60K sure can shrink fast, as you said, "This has to do with management and organization." If all thes costs are met, and your still making the desired profit, then you are fine, if not then there may be a need to adjust the percent of mark-up.

Why i said you can't just put a 50% off the wall, was if someone had jobs with more service work and required more special order items or pick-up orders, their mark-up could be higher then 50% resulting in a loss, or if someone had a lot of planned jobs, their mark-up may be lower then 50% not all business operate on a fixed rate.



[This message has been edited by LK (edited 01-11-2006).]

NO LK, I don't figure things that way.

I do fine not worrying about breaking things down to the minute detail.

In the end, no matter how small you break down the costs, the bottom line is the profit line. As long as I know what this job cost me, and how much I made is all I need to know. I already know what my fixed expenses are every year. How much you break it down is up to you. If you want to break it down to pennies for every task, that's fine. I lump them all together as expenses.

Dnk...