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L

Liam howe

Evening everyone,
What is everyones thoughts on labour rates that you would charge out if you were a business? I have recently started a company quoting for small jobs and charging myself out at ÂŁ25ph. I live 20miles north of london. Would you agree that this is an acceptable rate?

Thanks
Liam
 
TBH you've got to work out your annual costs ( incl What you want to pay yourself) and then divide by your productive hours.
You've then got to seek out what others are charging to see if your hourly rate is competitive or not. Quite simply, you can't charge a rate lower than your costs.
Agree with Murdoch, charge a higher 'first hour' rate.
Try to keep your overheads as low as possible, certainly till you get a feel for demand & competition.
Good luck!
 
Put it this way.... you leave home at 8am, travel for 30 minutes and do 1 hours work, repeat this 4 times - you will have been out of the house for 8 hours (not allowing for comfort and wholesaler visits) and then you have the admin and certs to do.

Gross income for the day ÂŁ125

Overheads run at about ÂŁ25 per day

Net income before tax and NI = ÂŁ100

Then allow for bank holidays, holidays, sickness, admin days..... weekends, days you don't have work - and you will be lucky to earn ÂŁ22K

no way enough to justify SE
 
When I think of a data cabling man who charges more than me at ÂŁ50 ph... and the work/cost of getting to where I am.... You are too low if you have the papers and experience. And as Murdoch says, the costs the costs! Too low I say.
 
Way too low for down south even too low for up north, don't under sell your services or you will be working like a slave for nowt.

when i first started working for myself i was under charging on my hourly rate as i'm a spark not a business man, i had more work than i could manage and was working seven days a week, the penny didn't drop i was under charging until i was on a job and the guy had left the 3 qoutes he'd received on the kitchen table in full view, i was the cheapest the next one was nearly double and the third was three times my price, after that my rates went up, my work load dropped but the money i was earning for less hours was still more than that i was making grafting my balls off.

Customers can also be cheeky gits, i've been to give qoutes when i use to work for myself and they counter offer with can you do it for this price, i don't want to pay any more than this, it's best to just walk away from those jobs, in a few cases what they wanted to pay wouldn't even cover the cost of materials, i'd have been out of pocket on parts and given my time away for free.

You soon wise up when money starts leaving your pockets for this that and the other and everything as to be paid for, when you work for a company and have no experience in the financial side you don't really know what things cost you go pick up the parts from the wholesalers and book them you never even ask the price, but when i start working for myself the wholesalers i'd been so use to because the company had an account i stopped using as they were over charging, you could see they were trying to take the pi$$, they'd charge what ever they thought they could get away with, i bet you can guess what firm it was.

When you consider every thing that has to be paid for van, van insurance, tax, mot,petrol, tools, test equipment, calibration, scheme costs, your education, advertising, income tax, company insurance, it all as to be paid before you even take a wage, and theres theres plenty of thing i've probably forgot, just rembered phone bill.

And when the customer ask why do you charge so much remember to tell them all of the above, as they think we must be millonaires trying to rip them off.
 
Way too low for down south even too low for up north, don't under sell your services or you will be working like a slave for nowt.

when i first started working for myself i was under charging on my hourly rate as i'm a spark not a business man, i had more work than i could manage and was working seven days a week, the penny didn't drop i was under charging until i was on a job and the guy had left the 3 qoutes he'd received on the kitchen table in full view, i was the cheapest the next one was nearly double and the third was three times my price, after that my rates went up, my work load dropped but the money i was earning for less hours was still more than that i was making grafting my balls off.

Customers can also be cheeky gits, i've been to give qoutes when i use to work for myself and they counter offer with can you do it for this price, i don't want to pay any more than this, it's best to just walk away from those jobs, in a few cases what they wanted to pay wouldn't even cover the cost of materials, i'd have been out of pocket on parts and given my time away for free.

You soon wise up when money starts leaving your pockets for this that and the other and everything as to be paid for, when you work for a company and have no experience in the financial side you don't really know what things cost you go pick up the parts from the wholesalers and book them you never even ask the price, but when i start working for myself the wholesalers i'd been so use to because the company had an account i stopped using as they were over charging, you could see they were trying to take the pi$$, they'd charge what ever they thought they could get away with, i bet you can guess what firm it was.

When you consider every thing that has to be paid for van, van insurance, tax, mot,petrol, tools, test equipment, calibration, scheme costs, your education, advertising, income tax, company insurance, it all as to be paid before you even take a wage, and theres theres plenty of thing i've probably forgot, just rembered phone bill.

And when the customer ask why do you charge so much remember to tell them all of the above, as they think we must be millonaires trying to rip them off.


Thankyou pal. Im just starting out and your exactly right. I used to work for a firm and also didnt ever challenge the prices at wholesalers etc. Im just trying to get my head around the whole financial side of things and I hope it will become easier as time progresses.
 
equally though, don't be too quick to hike your prices to that of your peers, they could well have been trading for some time with a good customer based. some jobs at ÂŁ25/h are better than no jobs at ÂŁ40/h. I agree with not devaluing the 'electrician' brand but you have to start at the bottom and work your way up. I think that's where I'm also at , see my 'being mugged off' post and my rates at similar to yours, although I'm further north. defo have a 1st hour price too.
 
All good advice already been said here, you need to build a customer base, get your foot in the door sort of speak, and competitive pricing will do this for you until you have a hand full of regular bread and butter customers.

Pricing is easy to be honest, if you price too high you wont get work, if you price too low you will be over worked.

Follow up any quotes you didn't win and ask why not, if you want to learn quickly.

Dont forget - someone will always do it cheaper, leave those ones alone.
 
equally though, don't be too quick to hike your prices to that of your peers, they could well have been trading for some time with a good customer based. some jobs at ÂŁ25/h are better than no jobs at ÂŁ40/h. I agree with not devaluing the 'electrician' brand but you have to start at the bottom and work your way up. I think that's where I'm also at , see my 'being mugged off' post and my rates at similar to yours, although I'm further north. defo have a 1st hour price too.

My first hour rate is ÂŁ50 + parts - which is what clients know/get told. If the job is relatively easy I might include the parts or even charge less. This works in Surrey but up north things will be different
 

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