business costs

[Ty Korrigan]

Had a couple of hours with my 'supervisors' this morning nailing down business costs.

Including such fascinating thoughts as cost to finance trucks/chipper/JCB micro/big mowers.

We just added up all the running costs

Including annual insurance/fuel- usually averages out over the year/ ppe/training/rent on premises/business rates/waste collection/fixing machinery/replacing machinery/ recovery/ fortunately we don't advertise/ book keeping/ accounts/bank charges/ small tool replacement/ = covers most of it.

Shocking- works out as £20+VAT per man hour worked including wages. Thats without quoting costs.

So 2 men in a truck need to bring in £320 + VAT per day just to pay all the bills.

Has anyone else done this calculation and what did you conclude?

 

Yes, it has become an obsession with me but you have forgot one very important thing here...

PROFIT!

As much as you can load onto a quote and at least 20%+ or you will be standstill or going backwards if you just 'pay your way'...

Ty

[Ty Korrigan]

If I ran around in a 20year old tranny tipper towing a handpainted chipper of dubious reliability wearing chainsaw pants with the stuffing falling out, the soles of my boots tied on with bailing twine and a groundy on a peanut diet THEN...I could perhaps charge less BUT...would I even get the right kind of clients...?

No, I have too much self respect to try the 'Ken Shabby Tree Lopping' route.

I charge the max, as much as I can, as I full well know that there are those who shop at Lidl and others at Waitrose...

As in...

This isn't Tesco's own brand tree lopping, this is Waitrose organic tree care with Aspen and veg oil smoothy...

Ty

And you don't need to be a billy whizz climber either to make a good go of it...

[likeitorlumpit]

If I ran around in a 20year old tranny tipper towing a handpainted chipper of dubious reliability wearing chainsaw pants with the stuffing falling out, the soles of my boots tied on with bailing twine and a groundy on a peanut diet THEN...I could perhaps charge less BUT...would I even get the right kind of clients...?

No, I have too much self respect to try the 'Ken Shabby Tree Lopping' route.

I charge the max, as much as I can, as I full well know that there are those who shop at Lidl and others at Waitrose...

As in...

This isn't Tesco's own brand tree lopping, this is Waitrose organic tree care with Aspen and veg oil smoothy...

Ty

And you don't need to be a billy whizz climber either to make a good go of it...

 

Yes- very true

I hadn't included profit nor my costs (quoting/ management)but it was scary when I did.

Almost got to the point where private clients can't afford us though as you say, when you present the right image then it's possible to add perceived value.

Our image tends to be unsignwritten/ unadvertised/ humble. In fact we have been established 30 years and I guess 99% of the people in Folkestone don't know we exist. We tend to work away bringing money home to our local town. There's an untapped market here.

[Hodge]

The thing with all this costs thing is you either get work or you don't, you can have all the gear, climber, groundie,insurance, do all work to bs3998, aa approved, vat reg, you price they cut etc,etc and charge x or you can be owner climber/groundie, van, chipper, insurance, bs3998, small is nice company and charge y or be old van, knack erred chipper hand to mouth no insurance, no overheads do crap work and charge very little except to make ends meet. Each of these will have customers and each in their own eyes make a living, makes a profit and does ok. Find which you want to be and stick to it. Don't worry about others do what suits you.

[benedmonds]

Well- mine works out at £60 per man per day overheads so thats almost exactly spot on. You must be running a similar setup. Or maybe this level is pretty standard. Add £60 onto your wage then add profit/quoting per job.

Hmm.....

Pedroskis £1 per minute for a 2 man crew is about right then.

Makes a slow start in the morning pretty expensive.

Also makes travelling very costly- the fuel costs are nothing to the wasted time spent in the truck not producing.

1 hour travelling is £40 in wages/overheads whereas fuel costs would be maximum £20. Theres just no point in going easy on the gas!

That £1 per minute really focuses the mind doesn't it.

 

This is why I get annoyed if guys go for a breakfast cob on the way out in the morning....

[Matthew Storrs]

Alot comes down to how much you pay yourself, I try and keep it seperate from what the buisness makes otherwise I find all my personal wage just gets lost in the wash- so to speak.

I try and have a base rate of what I need to make a day in order to cover costs comfortably, that includes maintenance costs- small tool (chainsaws etc) replacement, insurance and wages, I don't include large equipment costs unless im actually using it that day, when i do use large equipment (digger/tractor/chipper) I charge it out as if i had had to hire it, and add that to my base rate.

[Ty Korrigan]

We'll drive an hour regularly to work but its not wasted, I have our planning meetings and have serious discussions on these long drive, hammering out our forthcoming business strategy in microscopic detail...mostly talking to myself though...as The French man is normally asleep in the passenger seat and farting like a chimp on a blue cheese diet...PHEW!

Ty

[Marc Lewis]

The thing with all this costs thing is you either get work or you don't, you can have all the gear, climber, groundie,insurance, do all work to bs3998, aa approved, vat reg, you price they cut etc,etc and charge x or you can be owner climber/groundie, van, chipper, insurance, bs3998, small is nice company and charge y or be old van, knack erred chipper hand to mouth no insurance, no overheads do crap work and charge very little except to make ends meet. Each of these will have customers and each in their own eyes make a living, makes a profit and does ok. Find which you want to be and stick to it. Don't worry about others do what suits you.

 

very true

[Matthew Storrs]

The thing with all this costs thing is you either get work or you don't, you can have all the gear, climber, groundie,insurance, do all work to bs3998, aa approved, vat reg, you price they cut etc,etc and charge x or you can be owner climber/groundie, van, chipper, insurance, bs3998, small is nice company and charge y or be old van, knack erred chipper hand to mouth no insurance, no overheads do crap work and charge very little except to make ends meet. Each of these will have customers and each in their own eyes make a living, makes a profit and does ok. Find which you want to be and stick to it. Don't worry about others do what suits you.

 

I know which one of those options I aim for:thumbup1:

[Johny Walker]

I know which one of those options I aim for:thumbup1:

 

do tell