# Going rate, working for hourly/day rate, etc



## ProWallGuy (Apr 7, 2007)

This may run a bit long, so grab a cold beverage now.

A couple recent threads have had me thinking, and I wanted to touch upon a couple points. I decided to start a new thread so as not to hijack/mingle the other two. The threads I mention are the Rate Job thread, and the Going Rate thread. 

In the Rate Job thread, below you see my reply to it, and a response to my reply. And please don't think I'm singling out Davids Painting, it just fits into where I'm going with this.



ProWallGuy said:


> I tried this a couple years ago. Job lasted 5 weeks. It crushed me financially. While the $30 barely covered my wage and taxes, all the rest of my overhead suffered. Marketing, insurance, vehicle expenses, etc went unaccounted for. I will never, ever go down that road again. Pay me $55 an hour, and we can talk business, any lower than that, and I'll pass.





David's Painting said:


> So $440 a day? That's some serious coin.


Does $440 sound like some serious coin? Is it too high? Is it higher than the going rate in my area? Let me justify why I charge the way I do.

First off, I've been in this trade for 25 years. I can (humbly) say I'm probably as good as one can get at wallpaper and painting. Not saying I can't learn anything new, I do everyday, but seriously, after 25 years, if you haven't "mastered" your trade, you either didn't care enough to learn it, or you picked the wrong trade. 

So considering I view myself as someone who is at the top of their game in my trade, I feel that I deserve AT LEAST the same wage that a union journeyman would. If I'm making less than that, wouldn't it make more sense to just go get a job, and quit taking all the risks and headaches that a business owner takes on?

Here in StL, a union journeyman (painter, no category for paperhanger or decorator) makes $28.75 per hour, plus a fringe package of $13.41 per hour. That makes it $42.16 per hour. This covers their daily labor, plus all the benefits of being an employee such as health, dental, eye, life insurance, retirement plan, etc. Even though I'm a business owner, and not an employee of someone else, you can be damn sure I want those benefits for myself too.

$42.16 an hour, billed out for an 8 hour day comes to $337.28. Serious coin? Not yet. Because I'm a business owner, and not an employee, my overhead is much more than that. I got quite a few more expenses than just you basic fringe benefits. How about liability insurance, workers comp, office supplies, vehicle/fuel costs and maintenance, tools, sundries, uniforms, website, cell phone, office space/storage rental, and it goes on and on. All those things that come with owning a business need to be paid for too, and I damn sure don't want to cut my (deserved) wage or benefits to pay for them. All these could easily tack another $50-$75 per day. 

Now we are up to $387.28 - $412.28. Now is it serious coin? Maybe, but being a business owner, I still aim to make a PROFIT too. $387.28 x 10% profit comes up to $426.01. and I personally prefer to make as much profit as I can. 

So someone explain to me why I shouldn't attempt to price myself out at $440 a day? If you are truly a craftsman, and a business owner, maybe, just maybe, if you aren't trying to pay yourself what you deserve, you just may be that dreaded lowballer to the guys in your town who truly know how a business operates, and want to make a decent living at it.


Now, for the next question, is $440 the "going rate" for my services in my area? I have no clue, as I never looked at it that way. I don't really care what others are charging, just trying to get what I want and need. 

Have I priced myself out of jobs? Hell yes, I'm sure I have. But I also know that I keep busy enough to kept myself fed, my bills paid, and my conscience clear that I didn't lowball out some other guy just to keep busy.

I "share" work with another paperhanger here in StL, meaning I help him on large jobs, and same for me. He consistently charges only $200 a day. I have explained to him over and over that he needs and deserves more for his services. He says he understands when I explain to him how we deserve AT LEAST the wage of a journeyman, yet he's scared to try to raise is rates. His justification: "At least I'm busy." I don't know about you guys, but I sure as hell don't want to work 6-7 days a week to make what I could in 3-4 business days and spend the weekend off with my family. It almost infuriates me that he just. Doesn't. Get. It. 

But I will stick by my guns, and keep on charging what I believe is a FAIR PRICE for my services.

Discuss.


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## kdpaint (Aug 14, 2010)

I appreciate how you took the time to break that down very clearly. Some people live in fear, and they just don't get what it takes to have a life, and not work 7 days a week.


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## Oden (Feb 8, 2012)

PWG gets it that his local union rate isn't some wracked out, over the top rock star compensation for the work we do. It's a living wage is what it is. I absolutely think an owner/operator should be making his local rate unless he can make more. It's a living wage is all it is.


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## vermontpainter (Dec 24, 2007)

Thanks for prefacing with the cold bevvie prompt. 

I keep hearing in my head:

"You can be the cheap handyman in St Louis, I'll be the most expensive paperhanger."

Get you some!


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## scottjr (Jan 14, 2012)

Now, for the next question, is $440 the "going rate" for my services in my area? I have no clue, as I never looked at it that way. I don't really care what others are charging, just trying to get what I want and need.

Have I priced myself out of jobs? Hell yes, I'm sure I have. But I also know that I keep busy enough to kept myself fed, my bills paid, and my conscience clear that I didn't lowball out some other guy just to keep busy.



Whatever the "going rate" is it doesn't matter to me because I agree with what you said above. As long as I can charge what I need to to provide for my family and keep busy I am fine with that. I never really cared what other people made.

I can tell you that I raise my rate 5% each year but that's about it. This is my 3rd year since starting my business.


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## Dunbar Painting (Mar 19, 2010)

For all the reasons you mentioned, $440 per for a solo act is absolutely reasonable.

How would you personally add employees on to that? ( I know how I would)


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## Schmidt & Co. (Nov 6, 2008)

Dunbar Painting said:


> For all the reasons you mentioned, $440 per for a solo act is absolutely reasonable.
> 
> How would you personally add employees on to that? ( I know how I would)


I've always hired experienced painters, so I bill out every worker on site at the same rate.


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## Dunbar Painting (Mar 19, 2010)

Schmidt & Co. said:


> I've always hired experienced painters, so I bill out every worker on site at the same rate.


Yes. Essentially same here. There are the prep guy bill out rate and the painter bill out rate, and my bill out rate.

This is a business and I expect to make money!


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## Wolfgang (Nov 16, 2008)

Schmidt & Co. said:


> I've always hired experienced painters, so I bill out every worker on site at the same rate.


As it should be.


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## wje (Apr 11, 2009)

ProWallGuy said:


> Discuss.


 
Umm... you didn't really leave much to discuss... you NAILED it.:thumbsup:


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## Scotiadawg (Dec 5, 2011)

a contractor in this area says, "if you have to ask me how much this is going to cost, you can't afford me " . Only time i ever lowered my price ( but still make my profit ) was with a dirt poor couple in the area where I was raised, trying to freshen up the place for a daughters wedding. I know they had to scrap and save very hard to get the work done and they insisted on paying as soon as the job was done. I felt really good going home that day.:yes:


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## TJ Paint (Jun 18, 2009)

I'm not the most expensive painter in town yet, but I'm trying.

Please be patient with me.


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## Schmidt & Co. (Nov 6, 2008)

TJ Paint said:


> I'm not the most expensive painter in town yet, but I'm trying.
> 
> Please be patient with me.


Just keep at it TJ, you'll get the hang of it eventually


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## justadude (Feb 16, 2012)

This is one of my main bugga boos in doing business. We live in a walmart world where everyone want something for nothing. 

I stick by my pricing. I'm not doing this for the fun of it. I'm taking on all the risk for nothing. I want to build my business up so I can enjoy the rewards of taking on that risk.

I get real angry with people who just don't get it! They are so ing stupid. They deserve everything they don't get, because they are scewing themselves over and don't even get it. 

I have an employee who does side work all the time for 20 -25 an hour cash. ticks me off. 1, he's under cutting all of us. 2. he's not paying his share into the system. But in his mind he needs the money and if he gets payed 25 cash it's like making 32 on the books.


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## Blakelpd5 (Dec 2, 2012)

justadude said:


> I have an employee who does side work all the time for 20 -25 an hour cash. ticks me off. 1, he's under cutting all of us. 2. he's not paying his share into the system. But in his mind he needs the money and if he gets payed 25 cash it's like making 32 on the books.


How do you know he's not picking up side-work off of YOUR customers?
If the guy didn't ask me first, if he could do sidework, I'd can his ass, and tell him to start his own business. A good employee will give the business to you, and you will work him more (since that's what he wants), on those jobs.


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## Gough (Nov 24, 2010)

There is a small carpentry outfit with whom we work fairly often. The owner and I were discussing bumping our rates. His comment, "If we double our prices and loss less than half of our customers, we're ahead of the game."

An one of the last residential NC's we worked on, we were doing some decorative painting for the HO and another outfit was doing the walls, ceilings, and trim for the builder. I was talking to the owner of the other PC and he told me that he was going to ask the builder for an increase to his hourly rate (they were working T&M) on the next house. He was going to ask for $25/hour for himself and his helper. Not each, but for them both. As shocked as I was that he had a two-man crew working for that rate, I was even more shocked when I later learned that the builder turned him down,


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## wje (Apr 11, 2009)

Gough said:


> . He was going to ask for $25/hour for himself and his helper. Not each, but for them both. As shocked as I was that he had a two-man crew working for that rate, I was even more shocked when I later learned that the builder turned him down,


That is sad.


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## justadude (Feb 16, 2012)

Blakelpd5 said:


> How do you know he's not picking up side-work off of YOUR customers?
> If the guy didn't ask me first, if he could do sidework, I'd can his ass, and tell him to start his own business. A good employee will give the business to you, and you will work him more (since that's what he wants), on those jobs.


 
It's funny you say that.

He did ask me once if he could do some work for a guy who we painted his exterior. I was busy with some other things. He is broke, so I said ok.
Well today, we were talking I told him that this customer hadn't made up his mind on some other interior work and that it would be a while before this ho would make a decision. My guy say to me. Can I call him and see if I could do some work for him? of couse it would be cheaper and hard for the ho to pass up. So I got ed off and told him What do think?? I said you do what you got to do in an agry tone and said good bye. 

I really steamed about it. I'm getting ready to call him up and tell him if he calls him he's done and never call me again,


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## Painter-Aaron (Jan 17, 2013)

Gough said:


> There is a small carpentry outfit with whom we work fairly often. The owner and I were discussing bumping our rates. His comment, "If we double our prices and loss less than half of our customers, we're ahead of the game."
> 
> An one of the last residential NC's we worked on, we were doing some decorative painting for the HO and another outfit was doing the walls, ceilings, and trim for the builder. I was talking to the owner of the other PC and he told me that he was going to ask the builder for an increase to his hourly rate (they were working T&M) on the next house. He was going to ask for $25/hour for himself and his helper. Not each, but for them both. As shocked as I was that he had a two-man crew working for that rate, I was even more shocked when I later learned that the builder turned him down,


So when they both worked 8 hrs. He submits his bill for only 8 hours? Not 16? He is ripping himself off just as much as the builder who would be getting not only a really cheap paint job for 25$/hr but basically getting it at half off if they are indeed working two man hrs but only charging for one


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## justadude (Feb 16, 2012)

Gough said:


> There is a small carpentry outfit with whom we work fairly often. The owner and I were discussing bumping our rates. His comment, "If we double our prices and loss less than half of our customers, we're ahead of the game."
> 
> An one of the last residential NC's we worked on, we were doing some decorative painting for the HO and another outfit was doing the walls, ceilings, and trim for the builder. I was talking to the owner of the other PC and he told me that he was going to ask the builder for an increase to his hourly rate (they were working T&M) on the next house. He was going to ask for $25/hour for himself and his helper. Not each, but for them both. As shocked as I was that he had a two-man crew working for that rate, I was even more shocked when I later learned that the builder turned him down,


The gc won the job on price an only because of this idoit charging 12.5 an hour. Of course he said no. He knew the guy was to stupid to quit.


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## ProWallGuy (Apr 7, 2007)

Dunbar Painting said:


> How would you personally add employees on to that? ( I know how I would)


Easy, I just plug in their wage/burden to the equation.

And just to clarify, so Tambasco doesn't have an aneurysm trying to crunch these numbers, the scenario I posted is hypothetical. The prevailing wage of StL I posted is accurate, but I pay myself more than that (because I _am_ a rockstar, and doggone it, because I can) and my overhead is lower than what I described. But I just wanted to get my point across that when you hear someone say "I get XX per day or hour" there is a lot more to it than just that XX.


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## Gough (Nov 24, 2010)

Painter-Aaron said:


> So when they both worked 8 hrs. He submits his bill for only 8 hours? Not 16? He is ripping himself off just as much as the builder who would be getting not only a really cheap paint job for 25$/hr but basically getting it at half off if they are indeed working two man hrs but only charging for one


It was $25 for the painter and helper. As I understood it, he was paying himself $15 and the helper $10. I was too surprised to even ask if that was on the books or off.


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## daArch (Mar 15, 2008)

at 440 an eight hour day you may think you are getting 55/hour. When actually, as Barry explained in "Knowing what you are worth" (or were you not present at that one) you are actually being paid approx 36 - 40 /hour for every hour you spend on your business. 

( 1/3 of your business time is NOT at the wall).

Now, what does the Union pay? And all you do is show up in the morning and go home at night - no estimates, no invoices, totally business-free between 4PM and 8AM, business-free weekends, and business-free vacations. 

something to consider


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## ProWallGuy (Apr 7, 2007)

I hear ya, I posted that on the fly from my phone. And now you gave Tambasco something to ponder over, and he might never leave his basement again.

My main point is is you aren't making or charging as much as if you were working for someone else, go work for someone else.


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## daArch (Mar 15, 2008)

ProWallGuy said:


> My main point is is you aren't making or charging as much as if you were working for someone else, go work for someone else.


at times I wish I were Lee Epstein working for the union.

He's retiring like next year with quite a retirement plan. DAMN HIM !

Takes the train into the city with his bag o tools.


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## David's Painting (Nov 7, 2012)

ProWallGuy said:


> I hear ya, I posted that on the fly from my phone. And now you gave Tambasco something to ponder over, and he might never leave his basement again.
> 
> My main point is is you aren't making or charging as much as if you were working for someone else, go work for someone else.


Nice thread. I had my notebook out. :thumbs up:


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## Rcon (Nov 19, 2009)

ProWallGuy said:


> Does $440 sound like some serious coin? Is it too high? Is it higher than the going rate in my area? Let me justify why I charge the way I do.


$440 for a business owner is not serious coin. I make more than that in a day and I am an employee of a business owner. Not even union. I work more than 8 hour days though. But so does a business owner. 

My boss bills us out by the hour (T&M) and it works for him and the people he does business with. Everybody is happy that way - I make money, he makes money, and the client gets their work done. Of course, i`m not sure how well this model would work in the residential painting field but it works for industrial. 



ProWallGuy said:


> My main point is is you aren't making or charging as much as if you were working for someone else, go work for someone else.


Very wise words.


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## daArch (Mar 15, 2008)

Sorry to be a cynic, but it is scary that some folks may be having an epiphany when reading these words:



ProWallGuy said:


> if you aren't making or charging as much as if you were working for someone else, go work for someone else.


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## justadude (Feb 16, 2012)

daArch said:


> Sorry to be a cynic, but it is scary that some folks may be having an epiphany when reading these words:


Oh trust me! I would guess a third of the people on here are in some way are having and epiphany. And there is probably another third that should be but for some reason they think they are doing good business because they are busy. Which puzzles me. If you are in demand, don't have to go by the golden rule of supply and demand?? But then again, you may be indemand because you so cheap the ho's can't resist, not because you are really good at what you do.

I alway have and epiphany when forced to examine how I'm running my business. I admit it. I don't have it all figured out.


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## A+HomeWork (Dec 10, 2010)

I lectured my flooring guy about how cheap he is and that he could charge 20% more per job and stop working Saturdays and still bring in more than he is now!

Well, I had to apply that thinking to my self regarding some of the more challenging projects and much to my surprise, I still won the bid! I mean I threw a higher than high bid out there because it would be hard to fit it in within the next 6 weeks.

They called me and said it had to be done by April 1, so I bid it 50% higher and told my wife I'd be coming home a little late next week. We can live with that...:yes:.


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## plainpainter (Nov 6, 2007)

ProWallGuy said:


> I hear ya, I posted that on the fly from my phone. And now you gave Tambasco something to ponder over, and he might never leave his basement again.
> 
> My main point is is you aren't making or charging as much as if you were working for someone else, go work for someone else.


I don't know why you have to pick on me - I enjoyed this the fact you brought this up and not me. I posted a very detailed breakdown years ago at different hourly rates which wasn't well received. 

I've been doing some interior painting lately at home, and trying a different technique for estimating. At your price rate and my labor rate I am figuring somewhere north of $350 and south of $400 to paint two coats in an average 12x14 room, walls only with all the normal prep - materials included.

Note to Bill: if you want to delete this because of price, then so be it. But technically if I am discussing price with someone half way across the country how can that be construed as price fixing if my potential client will never have the ability to ask that person for a quote as well? It's only theoretical until I discuss with someone local who could potentially quote the same customer.


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## Dean CRCNA (Feb 4, 2010)

ProWallGuy said:


> $42.16 an hour, billed out for an 8 hour day comes to $337.28. Serious coin?


Glad you are making the $$$$$. Serious coin? If you stay busy, that is $85,000+ a year. I would say that is pretty serious coin. More than what 90% of folks earn in your area.

More than microbiologist, engineers and some scientist. Right close to airline pilots and many lawyers.


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## Greg Mrakich (Apr 19, 2010)

As a one man operation, I shoot for the $425-450 range per day plus materials.
There are deals on Angie's List wear you can get two "painters" for $500 a day. This is very easy to over come. I scare the home owner with the prospect of who they will send for that price. I have also noticed that one well organized guy can do almost as much work in a day as two. 95% of the time I finish early and on budget. I also give the home owners the option of saving $$ by moving their own sticks, so they are paying me to paint and not move couches. This saves them $$ and saves my back and quite a few take me up on it. People 50 and over see the value in a good job. They are planning on staying in their homes. Younger people who get a new iPhone every year and lease their cars and move every five years or so don't see the value of a tradesmen when HGTV tells them they can easily do it themselves with perfect results...as long as you buy your paint from Lowes.


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## Steve Richards (Dec 31, 2010)

Nice OP, PWG
my only suggestion might be that you change the title to:

So you want to hire a painting contractor?

It might help some HO's understand why professionals charge more than the teenagers next door.


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## plainpainter (Nov 6, 2007)

Dean CRCNA said:


> Glad you are making the $$$$$. Serious coin? If you stay busy, that is $85,000+ a year. I would say that is pretty serious coin. More than what 90% of folks earn in your area.
> 
> More than microbiologist, engineers and some scientist. Right close to airline pilots and many lawyers.


That's not salary! That's sales minus materials.


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## Dunbar Painting (Mar 19, 2010)

Rcon said:


> $440 for a business owner is not serious coin. I make more than that in a day and I am an employee of a business owner. Not even union. I work more than 8 hour days though. But so does a business owner.
> 
> My boss bills us out by the hour (T&M) and it works for him and the people he does business with. Everybody is happy that way - I make money, he makes money, and the client gets their work done. Of course, i`m not sure how well this model would work in the residential painting field but it works for industrial.
> 
> ...



I think the idea is $440 per day per person... if I have 3 guys on an exterior crew every day I am probably billing out close to $1500 a day!


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## plainpainter (Nov 6, 2007)

Wow, guess prices are going up. If painters are getting a $440 man-day rate now, things are looking up for the trade.


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## George Z (Apr 15, 2007)

I think the whole idea of this thread is to charge what is correct for your company.
PWG is using an example of how he does it and what the general guidelines are. 
Getting stuck on what a good number is, defeats the whole idea of this thread.
$440 is not a good number for everyone and regional has nothing to do with it.
For example: we would be way more profitable charging less than that.
A bigger company has and charges less overhead per hour.
If the number is $440 per person a day,
adding four more painters (even of the same skill level and pay) is not $440 x 5 painters


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## Dunbar Painting (Mar 19, 2010)

George Z said:


> I think the whole idea of this thread is to charge what is correct for your company.
> PWG is using an example of how he does it and what the general guidelines are.
> Getting stuck on what a good number is, defeats the whole idea of this thread.
> $440 is not a good number for everyone and regional has nothing to do with it.
> ...



Of course it is not the going rate across North America... but if some contractors charge $55 per man hour for boss & painters- then that is what they charge- Just because you don't does not mean it is incorrect. So for them it may in fact be 440x 5 painters!


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## George Z (Apr 15, 2007)

Dunbar Painting said:


> Of course it is not the going rate across North America... but if some contractors charge $55 per man hour for boss & painters- then that is what they charge- Just because you don't does not mean it is incorrect. So for them it may in fact be 440x 5 painters!


Yes of course, but that is not what I meant.


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## Dunbar Painting (Mar 19, 2010)

George Z said:


> Yes of course, but that is not what I meant.


my bad... just about to go to the dentist so extra jumpy :jester:


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## George Z (Apr 15, 2007)

If PWG added another person of the same skill, pay and burden,
he would not charge (the hypothetical) $440 x 2 
His hourly cost of Overhead is now half of what it used to be 
and he needs to charge half of what he did before to reach the desired profit number.
Now after a certain point, Overhead goes up for more marketing, admin and job management expenses.
Hope this explains better.


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## Dunbar Painting (Mar 19, 2010)

George Z said:


> If PWG added another person of the same skill, pay and burden,
> he would not charge (the hypothetical) $440 x 2
> His hourly cost of Overhead is now half of what it used to be
> and he needs to charge half of what he did before to reach the desired profit number.
> ...


Absolutely. The overhead is spread out when you have more than 1 person working to pay for it. The only increase is the added labour/burden of the extra worker. What would necessitate an increase in charging, would be increase in overhead!

That being said, sometimes you have to charge more before the overhead increases, this allows you more profit & chances for expansion.


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## Gough (Nov 24, 2010)

George Z said:


> If PWG added another person of the same skill, pay and burden,
> he would not charge (the hypothetical) $440 x 2
> His hourly cost of Overhead is now half of what it used to be
> and he needs to charge half of what he did before to reach the desired profit number.
> ...


Not quite, see: fixed versus variable costs.


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## MuraCoat (Jan 26, 2013)

ProWallGuy said:


> Does $440 sound like some serious coin? Is it too high? Is it higher than the going rate in my area? Let me justify why I charge the way I do.
> 
> Here in StL, a union journeyman (painter, no category for paperhanger or decorator) makes $28.75 per hour, plus a fringe package of $13.41 per hour. That makes it $42.16 per hour. This covers their daily labor, plus all the benefits of being an employee such as health, dental, eye, life insurance, retirement plan, etc. Even though I'm a business owner, and not an employee of someone else, you can be damn sure I want those benefits for myself too.


Great post and your logic sounds spot on. However, wouldn't it be easier just to get a union job to make what we all want to make as a solo operation? I mean, knowing what we should make for our business and actually getting those prices are two different things... 

How do you get $440 a day when 10 painter/paperhangers are coming in at half that price? Sure, I can walk in and give those prices, but honestly, I would most likely be sitting home many a weeks... There are plently of jobs I don't get.


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## George Z (Apr 15, 2007)

Gough said:


> Not quite, see: fixed versus variable overhead costs.


Sure.
But recovering Overhead hourly takes care of most of that.
It is quite accurate when you job cost every job, 
track job cost percentages month to month and then annually.

This is not the intent of this thread though.
It is presented very nicely by PWG and will serve most very well.


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## Harmony Haus (Mar 7, 2013)

justadude said:


> It's funny you say that.
> 
> He did ask me once if he could do some work for a guy who we painted his exterior. I was busy with some other things. He is broke, so I said ok.
> Well today, we were talking I told him that this customer hadn't made up his mind on some other interior work and that it would be a while before this ho would make a decision. My guy say to me. Can I call him and see if I could do some work for him? of couse it would be cheaper and hard for the ho to pass up. So I got ed off and told him What do think?? I said you do what you got to do in an agry tone and said good bye.
> ...



This employee of yours sounds like a real schmuck, I would've fired him toot-sweet!


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## Gough (Nov 24, 2010)

George Z said:


> Sure.
> But recovering Overhead hourly takes care of most of that.
> It is quite accurate when you job cost every job,
> track job cost percentages month to month and then annually.
> ...


You're right, as long as you are sure to include it in that hourly charge. PWG's original post with that $42.16 number did not, that was direct wages+fringe. He does point out later in the post that insurance, etc. would be extra.

I'm just trying to save some PCs from falling into the Milo Minderbinder Trap where they think, since they seem to be losing money as a small-time operator, they can make it up in volume by just hiring more help.

You're absolutely on the mark that tracking job costs in one of the big keys. A lot of the PCs that I know are just deluding themselves, because they don't really know their numbers.


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## CliffK (Dec 21, 2010)

George Z said:


> If PWG added another person of the same skill, pay and burden,
> he would not charge (the hypothetical) $440 x 2
> His hourly cost of Overhead is now half of what it used to be
> and he needs to charge half of what he did before to reach the desired profit number.
> ...


 Not sure I agree George. If my labor rate is a "hypothetical" $60/hour, then that is the rate for each and every professional painter I put on a job. There is no point in my opinion of creating a job for someone and not making an appropriate profit off of them. My labor burden on top of salary is somewhere around 80% of salary. In other words if I am hypothetically paying someone $20/hour they are costing me close to $40/hour. That leaves me a "profit" of $20/hour/man. Out of that I have to run the "business". In other words if I put 2 painters on a job for a day @ the hypothetical rate of $60/hour, it leaves me with somewhere around $320 for the day to run the business & profit after labor burden.


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## plainpainter (Nov 6, 2007)

Cliff, it would be helpful when you talk about "profit" that you insert "gross profit" so none of us are confused. Gross profit is defined as what's leftover after directs costs from the job, i.e. materials and labor. The remaining costs of overhead of running a business dwindles your Gross profit down to net profit. Two different 'profits' with very distinct meanings.


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## Dean CRCNA (Feb 4, 2010)

plainpainter said:


> That's not salary! That's sales minus materials.


In his example, he mentioned wanting make what union leads do. It is $42.16 and hour (income + benefits) as he mentioned. If he is staying busy, it is around 85K. 

Notice he is not saying he is busy 40 hours a week. It could be that he only gets 10 hours of work a week at that rate. Who knows.

On other boards, I've noticed guys talking about charging $50 an hour or $75 an hour. Then you go over to their house and they are renting a 2 bedroom 1 bath place. Something doesn't make sense, unless it is that they aren't working full time.


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## Gough (Nov 24, 2010)

Dean CRCNA said:


> In his example, he mentioned wanting make what union leads do. It is $42.16 and hour (income + benefits) as he mentioned. If he is staying busy, it is around 85K.
> 
> Notice he is not saying he is busy 40 hours a week. It could be that he only gets 10 hours of work a week at that rate. Who knows.
> 
> On other boards, I've noticed guys talking about charging $50 an hour or $75 an hour. Then you go over to their house and they are renting a 2 bedroom 1 bath place. Something doesn't make sense, unless it is that they aren't working full time.


I think you hit the nail on the head. I'd be real curious to see what the average annual number of hours is for a lot of trades. For a WAG, I'd say closer to 1500 or less, rather than the 2000 that would result from 50 40-hour weeks. 

Can't speak for the rest of the country, but around here, once a tradesman starts working for those kinds of wages, a lot of his take-home pay seems to go for toys. I can tell when there's been a downturn in the building sector by the number of tricked-out late-model pickup trucks at the used car lots.

I worked with a union bricklayer for a while early on. He was talking about the union pay scale for them and mentioned that the wages were adjusted by area to account for the average amount of down time that they experienced. In other words, the rate was higher here in N Idaho, because they would average fewer hours here than they would in Texas, for instance. I don't know if that's the case with other specialties as well.


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## George Z (Apr 15, 2007)

CliffK said:


> Not sure I agree George. If my labor rate is a "hypothetical" $60/hour, then that is the rate for each and every professional painter I put on a job. There is no point in my opinion of creating a job for someone and not making an appropriate profit off of them. My labor burden on top of salary is somewhere around 80% of salary. In other words if I am hypothetically paying someone $20/hour they are costing me close to $40/hour. That leaves me a "profit" of $20/hour/man. Out of that I have to run the "business". In other words if I put 2 painters on a job for a day @ the hypothetical rate of $60/hour, it leaves me with somewhere around $320 for the day to run the business & profit after labor burden.


But Cliff, your OH rate goes down dramatically the more people you hire.
Yes, they all get charged out to the customer the same hourly or daily rate,
and I think that's what you mean.
But the hourly rate you charge does not stay the same
when you go from 1 to 3 or 12 or 4 or... painters.


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## CliffK (Dec 21, 2010)

George Z said:


> But Cliff, your OH rate goes down dramatically the more people you hire.
> Yes, they all get charged out to the customer the same hourly or daily rate,
> and I think that's what you mean.
> But the hourly rate you charge does not stay the same
> when you go from 1 to 3 or 12 or 4 or... painters.


 Only the overhead rate for the " operating the business" goes down because it is divided by more bodies producing revenue. The labor burden over and above salary is simply multiplied by the number of employees. Nobody is giving me a discount on workers comp, pension contributions, social security, medicare, etc., etc. based on a larger quantity of employees. It is all based on salary.
I realize many times guys are talking about the same thing, just calling it by different names(we're not all economists here like Dan), but I am afraid with your approach many "in the bucket" guys will think they can bill out for employees at a much lower rate than themselves and still be profitable. If you are a legitimate guy that is a recipe for failure.


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## CliffK (Dec 21, 2010)

plainpainter said:


> Cliff, it would be helpful when you talk about "profit" that you insert "gross profit" so none of us are confused. Gross profit is defined as what's leftover after directs costs from the job, i.e. materials and labor. The remaining costs of overhead of running a business dwindles your Gross profit down to net profit. Two different 'profits' with very distinct meanings.


 I'm sorry Dan, I didn't mean to confuse you. I was talking about "profit" on labor, but before business expenses with no consideration for materials. I was just addressing George's approach that you can bill out for less and less/unit as the number of employees increases. Call it what you like.


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## plainpainter (Nov 6, 2007)

Cliff - George is assuming that your company indirect overhead doesn't change as you hire more employees, thus the burden each crew member carries is less and less - therefore he is sayiing you can lower your man-hour rate. 

Personally if I can close at $55/hr - I don't care if it's just me, 5 guys or 25 guys - if I can close at $55/hr I'll keep it at that price for no matter how many more guys come on board - I've never liked the concept of adjusting rates for a service just because your rosters change. If a bedroom repaint is worth $500 - where is the incentive to charge $400, just because I can?


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## George Z (Apr 15, 2007)

CliffK said:


> Only the overhead rate for the " operating the business" goes down because it is divided by more bodies producing revenue. The labor burden over and above salary is simply multiplied by the number of employees. Nobody is giving me a discount on workers comp, pension contributions, social security, medicare, etc., etc. based on a larger quantity of employees. It is all based on salary.
> I realize many times guys are talking about the same thing, just calling it by different names(we're not all economists here like Dan), but I am afraid with your approach many "in the bucket" guys will think they can bill out for employees at a much lower rate than themselves and still be profitable. If you are a legitimate guy that is a recipe for failure.


Cliff, I replied above:


> But recovering Overhead hourly takes care of most of that.


Every hour worked by anybody is charged at the same rate.
For us this rate does include all your mentioned burden, 
as well as vacation pay and 13 paid Stat Holidays.
I guess in a way we are saying the same thing. 
The "fixed" OH drops with more painters but it is significant for some.


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## Steve Richards (Dec 31, 2010)

Dean CRCNA said:


> Notice he is not saying he is busy 40 hours a week. It could be that he only gets 10 hours of work a week at that rate. Who knows.


 Ideally, I'd work 1.5 hours a year @$55,000 per.


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## ProWallGuy (Apr 7, 2007)

1 iron in the fire. I like your style Steve.


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## Steve Richards (Dec 31, 2010)

I'd get up on that day..."ah crap, I have to work today"

Wife: "gee honey, you're only working an hour and a half, and you'll be off the rest of the year."

"Don't try to sugar coat it, woman!"


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## the paintman (Feb 3, 2012)

plainpainter said:


> Cliff - George is assuming that your company indirect overhead doesn't change as you hire more employees, thus the burden each crew member carries is less and less - therefore he is sayiing you can lower your man-hour rate.
> 
> 
> What most of the recent post are referring to is simple economics and its called "Economy of Scales". Google it for a simple explanation. In it's grandest form H. Ford was able to reduce the cost of the Model T each year for several successive years in order to accomplish his noble grand goal of putting 4 wheels under every household. If you want a good read. I reccomend " Henry Ford the man and the machine". When your done you will appreciate what a great man (and country this is too, or was lol) he truly was.
> ...


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## thinkpainting/nick (Dec 25, 2012)

Gough said:


> I think you hit the nail on the head. I'd be real curious to see what the average annual number of hours is for a lot of trades. For a WAG, I'd say closer to 1500 or less, rather than the 2000 that would result from 50 40-hour weeks.
> 
> Can't speak for the rest of the country, but around here, once a tradesman starts working for those kinds of wages, a lot of his take-home pay seems to go for toys. I can tell when there's been a downturn in the building sector by the number of tricked-out late-model pickup trucks at the used car lots.
> 
> I worked with a union bricklayer for a while early on. He was talking about the union pay scale for them and mentioned that the wages were adjusted by area to account for the average amount of down time that they experienced. In other words, the rate was higher here in N Idaho, because they would average fewer hours here than they would in Texas, for instance. I don't know if that's the case with other specialties as well.


Funny up until the 80"s boom no trade here stayed busy year round, winters always got slow. Last few years slow as well for 75% of the ones I deal with. I never use 2000 hours to gauge my OH . I look at last 3 years or so and average it out for coming year then I just find out the going rate is $25 an hour and charge $24 and stay real busy...I'm kidding.


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## thinkpainting/nick (Dec 25, 2012)

George Z said:


> But Cliff, your OH rate goes down dramatically the more people you hire.
> Yes, they all get charged out to the customer the same hourly or daily rate,
> and I think that's what you mean.
> But the hourly rate you charge does not stay the same
> when you go from 1 to 3 or 12 or 4 or... painters.


If I work alone and my OH is $15 and hr that's what I tack on to my hourly rate. If I hire 2 more painters and I work with them in the field now I just spread the $15 over 3 guys. I still charge my same rate but OH is lower cause 3 workers instead of one are covering it so long as we are all working. I know guys who charge according to hourly rate for there workers. So if I pay one guy $12 they add there OH and burden and profit . If another worker makes $15 another $18 etc they are not charging the same hourly rate per worker but still covering all costs plus profit..


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## Workaholic (Apr 17, 2007)

Nice thread Tim. :thumbsup:



Steve Richards said:


> Ideally, I'd work 1.5 hours a year @$55,000 per.


 Atrophy would rule you SR.


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## Painter-Aaron (Jan 17, 2013)

thinkpainting/nick said:


> If I work alone and my OH is $15 and hr that's what I tack on to my hourly rate. If I hire 2 more painters and I work with them in the field now I just spread the $15 over 3 guys. I still charge my same rate but OH is lower cause 3 workers instead of one are covering it so long as we are all working. I know guys who charge according to hourly rate for there workers. So if I pay one guy $12 they add there OH and burden and profit . If another worker makes $15 another $18 etc they are not charging the same hourly rate per worker but still covering all costs plus profit..


What I do not understand Is the fact that you can bid a job for two months down the road say. And bid it to specify your situation right now. But what if things change. A couple guys quit and you work with less guys or hire new guys at different wages. That's why I add hourly wage + OH+ profit and I bid the job for how many hours it will take. Plus materials. But I do not bill half the hours at a different rate as I would be undercutting myself if for whatever reason I had to do it alone.


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## Ultimate (Mar 20, 2011)

What does this come to per day on average? 


http://www.google.com/url?sa=t&sour...pFA0dXcfS6DazKEPQ&sig2=oMwXcH_l4ah0tPQIdJmewA


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## Gough (Nov 24, 2010)

HouseOfColor said:


> What does this come to per day on average?
> 
> 
> Here are some helpful statistics from the Bureau of Labor Statistics. Unfortunately, they combine construction and maintenance painters, which muddies the waters. OTOH, like many of us would like to do, they exclude paperhangers.
> ...


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## thinkpainting/nick (Dec 25, 2012)

Painter-Aaron said:


> What I do not understand Is the fact that you can bid a job for two months down the road say. And bid it to specify your situation right now. But what if things change. A couple guys quit and you work with less guys or hire new guys at different wages. That's why I add hourly wage + OH+ profit and I bid the job for how many hours it will take. Plus materials. But I do not bill half the hours at a different rate as I would be undercutting myself if for whatever reason I had to do it alone.


Easy most painters or laborers etc are hired for the same wage whether a journeyman or apprentice . Sure some are faster or slower but for the most part it all works out. If I bid the job today and it doesn't start for two months and my crew quits what do I do tell the customer I need to rebid the job? My buddy was and still is a union estimator on big commercial projects. They don't figure a good mechanic and a apprentice at the same rate. The reason is it doesn't cost them as much labor wise as a mechanic who they are paying 3 times the apprentice or laborer. Pats nice little estimating program shows you just that when your figuring your labor rate. Len Fife and many other estimating gurus also did seminars on this whole topic.


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## Steve Richards (Dec 31, 2010)

I wonder what the average self-employed one-man shop charges/bills himself out at.
I guess I could start a poll...but I bet some of you guys would lie anyhow. 

Like thepaintman...I don't like working "by the hour". That's a good way to have a HO watching you and the clock.


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## DeanV (Apr 18, 2007)

I think most do not bill hourly, just a rate used to determine price of project.


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## Steve Richards (Dec 31, 2010)

DeanV said:


> I think most do not bill hourly,


Maybe another poll for that?

For someone just starting out, it MIGHT make sense to charge low, and build a clientele base...then (slowly) raise their rates.

I know that to get someone from $9 an hour to $60, it takes about 25 years.

..and then the bastard will sell off most of his property, and you're standing there holding a $60 per hour bill with no one to give it to!

but I'm not bitter.


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## Gough (Nov 24, 2010)

thinkpainting/nick said:


> Easy most painters or laborers etc are hired for the same wage whether a journeyman or apprentice . Sure some are faster or slower but for the most part it all works out. If I bid the job today and it doesn't start for two months and my crew quits what do I do tell the customer I need to rebid the job? My buddy was and still is a union estimator on big commercial projects. They don't figure a good mechanic and a apprentice at the same rate. The reason is it doesn't cost them as much labor wise as a mechanic who they are paying 3 times the apprentice or laborer. Pats nice little estimating program shows you just that when your figuring your labor rate. Len Fife and many other estimating gurus also did seminars on this whole topic.


Same wage for journeyman and apprentice? Really? Overall, our wage scale reflects an employee's productivity. We're not paying a newbie the same as a skilled mechanic.

We also charge our painters and our helpers at different rates, with the idea that the rate is based on productivity. When we've had T&M work done by other trades, they charge their people out in a similar fashion. e.g. electrician: $60, apprentice: $45.


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## Greg Mrakich (Apr 19, 2010)

DeanV said:


> I think most do not bill hourly, just a rate used to determine price of project.




I carry a Ouija Board in my truck and consult Keith Moon for pricing.


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## the paintman (Feb 3, 2012)

I agree your probably right that most of us don't bill hourly and its only a basis for bidding jobs and/or for me job costing out a job after completion to see how much profit was actually realized. So for those purposes only i use one rate for both bidding and costing out a job. Its on the high side average for both laborors and painters. But mostly accurate because I don't typically use any help other than skilled labor so it works for me. 

And probabably would for most people. Because in reality a laboror/helper does not cost you any less in the end. Or the customer for that matter. The truth is they cost you maybe more. Production from a journeyman, completion of task and quality of work for me trumps a few dollars im saving paying a helper. 90% of the time i would say. 

So you should be able to use one rate for these purposes. Now if I'm actually billing T and M an hourly rate, sure i might show different rates for the customers benefit and piece of mind. But unbeknowest to the customer, he could be paying more for helpers in the end because it's for sure going to take more hours for the task they perform. 

If I do bid daily it is in the neigborhood of what the OP said but a little lower only because of my geograpic area is lower than his. Add to that In most instances It's impossible to get anyone here to accept that a painter is worth that rate here. They would pop an artery or die laughing. At the very least a kind one would thank you for your time maybe, and immediatly call your competitor that is chargeing $40 -$45 that you just made look like a super good deal.


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## CApainter (Jun 29, 2007)

Excellent thread!

I don't know if this applies, but I had to recently determine prevailing wages through the California DIR [Department of Industrial Relations]. Even though prevailing wage applies more to "public works" projects only, I think it well represented (as a benchmark) both local apprentice, and journeyman base scale wages.

However, it has always been common trade knowlege in the San Francisco Bay Area, that union scale wages hardly, if ever, apply to single familiy residential painting projects. The highest trade wages seem to be reserved for hotels, large commercial and residential buildings, and industrial facilities.


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## Gough (Nov 24, 2010)

CApainter said:


> Excellent thread!
> 
> I don't know if this applies, but I had to recently determine prevailing wages through the California DIR [Department of Industrial Relations]. Even though prevailing wage applies more to "public works" projects only, I think it well represented (as a benchmark) both local apprentice, and journeyman base scale wages.
> 
> However, it has always been common trade knowlege in the San Francisco Bay Area, that union scale wages hardly, if ever, apply to single familiy residential painting projects. The highest trade wages seem to be reserved for hotels, large commercial and residential buildings, and industrial facilities.


Last time we worked on Davis-Bacon (or "Little" Davis-Bacon) jobs, they had two different scales: D-B Commercial and D-B Residential.


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## the paintman (Feb 3, 2012)

Gough said:


> HouseOfColor said:
> 
> 
> > What does this come to per day on average?
> ...


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## CApainter (Jun 29, 2007)

Gough said:


> Last time we worked on Davis-Bacon (or "Little" Davis-Bacon) jobs, they had two different scales: D-B Commercial and D-B Residential.


The residential must have been public housing. Do they compare to private residential wages?


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## Steveqpp (Apr 25, 2012)

The more I read the more I get confussed. If you REALLY want to know what YOU get a hour, its tax time so this should be very easy. Take and add all your bank deposits, minus all materials equales gross sales. 
After 40 years of tracking I use 1550 for total hours worked per full time person. 1550 times total employees equales total hours. Gross sales divided by total hours equals hourly rate. 

Now take every thing you spent for the business (insurance, taxes, marketing, trucks, phones ect) divide that number by total hours equales your cost per hour plus the wages equales your hourly cost.

Now are you making what you think you are?

PS George is RIGHT. If you recover your costs with 10,000 hours if you produce 12,000 Your costs are much less per hour.


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## plainpainter (Nov 6, 2007)

Steveqpp said:


> Take and add all your bank deposits, minus all materials equales gross sales.


That's Net sales, gross sales includes materials.


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## Gough (Nov 24, 2010)

CApainter said:


> The residential must have been public housing. Do they compare to private residential wages?


Yes, that was a public housing project. They were at the high end of regular residential rates around here.


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## thinkpainting/nick (Dec 25, 2012)

Gough said:


> Same wage for journeyman and apprentice? Really? Overall, our wage scale reflects an employee's productivity. We're not paying a newbie the same as a skilled mechanic.
> 
> We also charge our painters and our helpers at different rates, with the idea that the rate is based on productivity. When we've had T&M work done by other trades, they charge their people out in a similar fashion. e.g. electrician: $60, apprentice: $45.


Not what I meant at all. In other words most journeyman make the same wage yes some are faster more productive but in general they make the same. Same thing with apprentice most make anywhere from 50-75 percent of journeyman depending on there skill. I guess I'm not very good at explaining myself. As for wage scale and productivity reliability, neatness. Tardiness etc that goes without saying.


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