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how much to charge an hour for a tractor with cone splitter?


Martin du Preez
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Initially I thought that 0.05% was a bit low for the machine but it actually works out quite well.

 

I think it works if you don't include the tractor, they normally take a bit more than 200 days.

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Does working it out on a percentage actually work? For example, I buy a new tractor for £40,000- 0.05% of this is £20. I also buy an old tractor for £5k which using the same equation is only £2.50. They both do the same job so why should the customer have to pay to have shiny kit onsite.

 

Much better to work out a depreciation cost per machine hour IMO. If I buy the new tractor the benefit comes to me in the form of a longer working life but they should both be costed the same regardless of age and initial cost...

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Does working it out on a percentage actually work? For example, I buy a new tractor for £40,000- 0.05% of this is £20. I also buy an old tractor for £5k which using the same equation is only £2.50. They both do the same job so why should the customer have to pay to have shiny kit onsite.

 

Much better to work out a depreciation cost per machine hour IMO. If I buy the new tractor the benefit comes to me in the form of a longer working life but they should both be costed the same regardless of age and initial cost...

 

Read what you have wrote again.

 

Instead of purchase cost you have used depreciation. IE the cost to replace it. IE the same thing over the same time frame.

 

Choose your depreciation / replacement time frame & both methods will be the same.

 

0.05% is 2000 hours or 250+ working days.

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  • 1 month later...

I understand what the other commentators are saying, but I would also ask what the market will hold, that is ask the customer. I have a tractor and cone splitter and I would be happy to split locally for £25 including the travel cost. My tractor is fully depreciated and the cone splitter was £500 second hand and must have split 200T with it.

Edited by Tanat Valley Firewood
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