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#159062 - 10/19/06 07:53 AM chicago pricing  
cathouge  Offline
Junior Member
Joined: Oct 2006
Posts: 1
chicago,il, u.s.a.
Hey everyone,I am thinking about going on my own, but I am not sure the price per opening here in chicago. I have been in mostly comercial work for the last 10 years. Can anyone help? tHANKS


Business, Office, Estimating, Legal:

#159063 - 10/19/06 11:00 AM Re: chicago pricing  
renosteinke  Offline
Cat Servant
Member
Joined: Jan 2005
Posts: 5,316
Blue Collar Country
I firmly believe that there are almost no situations where a "per opening" price is suitable as a means for quoting a job. Such a figure may be of some use to you - and you alone- after the job, as a means of checking yourself. It may also be a means of finding the "adder" for changes to an already documented job.

For blind quoting, you're nuts to simply count openings, then multiply.

I quote a job by first developing a plan of what needs to be done. This is based, in part, on what I see on the job site and my past experience with the general contractor.

I know what it costs to keep my business running for a year. This forms the basis of my hourly rate. I make my best guess as to the time the job will take, allowing for all the little things that can make time 'unproductive.' Time x rate = the labor portion.

I make my best guess as to the materials that will be needed. I add something for all the wire nuts, saw blades, etc., that I will use. This gives me the materials cost.

Labor + materials = my minimum quote. I might very well add to this figure, depending on the work conditions, the people involved, my schedule, and whether I want the job (or not).
A proven customer- one who has already provided steady work, pays promptly, and knows what he wants- is rewarded by my 'sharpening my pencil' and giving him a lower price.

A final check on my results is made by comparing my bid to those of others. In general, if you're price is near that of several others, you're n the right track. Too low, and you're missing something. Too high, and you've got issues to address.

So far, software programs are severely limited to "known" jobs, of a size large enough that any errors tend to cancel out. For a brand new, one man shop- forget it.


#159064 - 10/19/06 11:43 PM Re: chicago pricing  
LK  Offline
Member
Joined: Jan 2003
Posts: 1,429
New Jersey
The way i see it, price per opening is ok for a hospital patient, but not much good in the electrical field, Reno's post, pretty much covered the problems with per opening pricing.


#159065 - 10/20/06 09:44 PM Re: chicago pricing  
Active 1  Offline
Member
Joined: Feb 2003
Posts: 687
Grayslake IL, USA
Welcome

I charge per opening and then ajust or add for other factors. If you break it down backwords it is really simular to figuring T&M+MU. That is if you took the time to figure the T+M+MU for each process.

Instead of asking how much per opening you really should ask help figuring your 1st year overhead and how many hours you will bill.

A mistake some make when starting out is to think they have almost no overhead (OH)and most of the company sales are income. Look back on past Biz threads and you may find all the cost of running a business listed.

Another mistake is to base your prices on the other shops. Worse then that is to try and be the lowest priced company.

You do need to figure how much you need to make per day, week, month.

You need to try to figure how much work you will have and how many hours you will bill per day on average. If your runing small calls all day half your time is running around, cleaning up, and collecting. If your starting out you may have many days with no work so the paying jobs need to cover this. Don't count on booking 8 hours a day every day of paid work. That is another mistake.

Don't believe the idea of get a phone number and a yellow page ad and you will have the phone rinning keeping you busy. In Chicagoland the phone books are loaded with companies. Last I counted was around 300 EC listed in just one book. I'm sure there are a number of micro EC that are not listed in the phone book. Also EC here will travel many miles for work. So how will you stand out and be found by the customer? Who will be your big customers? Do you have anything lined up?

One last note on pricing is you should adjust for the type of work. You did not say what you wanted to concintrate in. New res cookie cutter homes may be the lowest paying work. Custom Res better. Then Comercial new. Res service calls. Comercial service calls charge more. City work is an extra. Some reasons for this is the efficency factor of getting the work done, distance to truck, time to get paid, how big the job is (small costs more), emergency factor, and competition.

Try to take some time and read many of the past Biz threads.

Good luck



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