Gobsmaacked over plumbers quote

We have to reroute the sewerage line from the expected entry point to another point out the front. Involves digging totally in sand approx 5mts, laying down the new pipe, filling with scoria, replacing sand. Paperwork and new plan submitted to water board and water board fee of $150 for breaking into the line (only 3 mths old) Quote $1500 - when queried he said he was charging 2 days work at $75 per hour!!!! (forget going to uni anyone - become a plumber instead). I was gobsmacked, anyone else think this is fair. He has offerered to do it by the hour but have had problems with this system in the past (carpenters charging us through the roof and an hour for lunch and starting late in the morning)
 
Sounds like he is on the cheaper side for hourly rates.

just out of curiosity. How much of the 75 ph do you think actually is paid to him as a wage
 
Your going to be shocked at Plumbers/Electricians/Painters/Accountants and every other professions quotes when they pop up then :D

Sounds reasonable
 
wouldn't it be all of it? it's not like he needs to run a cappuccino machine for visitors??


It certainly isn't.

Car, insurance, office/warehouse. all employee entitlements. also could have a cappuccino machine for visitors at his office if he is doing well.

For Each one of my blokes in a van i need to get back 70 ph to break even.

So if he is charging 75ph for them, then he is not really making much on labor at what roughly 7 or 8% on labor which is tiny.

Would you do a small job any be happy making 7%
 
It certainly isn't.

Car, insurance, office/warehouse. all employee entitlements. also could have a cappuccino machine for visitors at his office if he is doing well.

For Each one of my blokes in a van i need to get back 70 ph to break even.

So if he is charging 75ph for them, then he is not really making much on labor at what roughly 7 or 8% on labor which is tiny.

Would you do a small job any be happy making 7%

well I guess my happiness is irrelevant to whether I get the job or not. If I am running overheads to such a level and then a sole operator comes along with nothing but a clapped out white van and a $50/mth mobile then I would presumbaly lose the business. Tho I admit people do like to pay for the slick image. Look at that show last night with that bunch of over paid lawyers - makes you gag just thinking about the misery they have inflicted on others to extract that sort of wealth. nice views - paid by schmucks who couldn't afford a better lawyer.
 
He's the guy in the black ute with the mobile. No office, no website, which is why he got the job. I stear well clear of paying someone else's overheads for big flashy offices and receptionists. I reckon this is 4-6 hrs work absolute tops, then make a phone call and post a letter, total $600, I was expecting quote to be about $800.
 
Just because a tradie has low overheads doesn't mean he quotes cheaper. Just as a slick company wont always quote higher, they have to be competitive.

It mostly depends on how much they need the work.

He's the guy in the black ute with the mobile. No office, no website, which is why he got the job. I stear well clear of paying someone else's overheads for big flashy offices and receptionists. I reckon this is 4-6 hrs work absolute tops, then make a phone call and post a letter, total $600, I was expecting quote to be about $800.
 
Is usually recommended that to obtain several different qoutes with the same scope and see if there is a massive price difference....

Yes, i agree tooo. why does plumbers charge a fortunate....

You can get a labourer to dig a hole for $20 per hour....

The only expertise is needed is the connections and laying and the bulk of the work is just digging.....

Iam thinking if 80% is just digging and the rest is connecting why so much??!???
 
ring your local PM, find out who they use as a handyman then see if you can get the handyman (at $25/hr) to dig the trench and just pay the plumber for plumber stuff.

There is no way I'd be paying someone $75/hr to dig a trench!

I regularly have my handyman out to help me do renovation prep work on the houses I do (fix double hung windows, help me pour footing, build privacy screens etc) - way cheaper than a builder and usually I get him for a full day of little things.
 
Here is the link to a calculator to work out how much to charge.
http://www.masterplumbers.com/utilities/costcalc/

Also understand that you do not have work week in, week out and not all days are money making. Not to mention people ripping you off builders going bust and taking all your money.
I'm not saying tradies don't overcharge, but understand the cost of doing business in this country is crazy. OHS, workers comp, and employee’s entitlements all add up to a very large %. There are plenty of hands in my pocket.
But there are always those shonks that charge way too much (and there are plenty). They usually end up with no work.
It's hard to explain to those that are employees because they have a totally different mentality and how things should be priced to someone running a business.

More calc
Historically, we have always charged ourselves out on an hourly basis. If we think a project will take 15 hours to design, we estimate 15 x our hourly rate. This makes it imperative that our hourly rate isn't plucked out of thin air; it must cover our fixed costs + wages + a profit margin.

Fixed costs and wages are called expenses. These are non-job related costs that must be paid regardless of how much work is produced. They include things like equipment leases, car expenses (including parking), internet connection (including download/upload costs), fax and photocopier paper, rent, accounting and advertising costs. It's also important to remember that wages include salary + tax + superannuation + workcover insurance costs.

The amount of profit margin you want is determined by past experience and the market. A suggested benchmark is 20%.

One way to ascertain an hourly rate is to add your fixed costs of (say) $5,000 per month with the wages bill of (say) $5,000 per month with a profit rate of (say) 20% i.e. $2,000 per month.

$5,000 + $5,000 + $2,000 = $12,000 per month or $144,000 per year.

Next, it's safe to assume you will work 48 weeks (240 working days) per year, less public holidays. The number of public holidays will vary from state to state, but, on average we work about 234 working days. Multiply that by 8 hours per day = 1872 billable hours per person per year.

That means your hourly rate is $144,000/1872 = $77 per hour.

You might think that's great because you're charging $100.00 per hour.

Wrong.

The $77 per hour assumes that you can charge yourself out for 8 hours of every working day of the year.

What about time for new business, or administration duties?

A more realistic figure is to work on 6 hours billable per day, making your total billable hours 1,404 per year

With fixed costs and profit of $144,000 per year your hourly rate is $144,000/1404 = $102 per hour.

To make the hourly rate even more accurate, you must identify all possible chargeable time and the items you purchase on behalf of your clients. One example is travelling time to and from client meetings. If you don't want to charge it, but find you are spending 1 hour a day on the road, then you need to revisit your overheads formula and work on 5 hours billable per day, equalling 1170 hours per year. That will change your hourly rate to $123.

We have found by rigid examination of the hours we work, the tasks we do and the cost of running the business, we are able to sustain good, reliable profits.
You may charge at a set rate but it doesn't mean people will take it if it's too high. So it ends up a catch 22 situation. You lose days from too high a quote and end up needing to charge more to cover costs. Which means you end up losing more work. You have to be flexible in different cycles of the economy. There are times where you make it and times to get by in.
 
Is usually recommended that to obtain several different qoutes with the same scope and see if there is a massive price difference....

Yes, i agree tooo. why does plumbers charge a fortunate....

You can get a labourer to dig a hole for $20 per hour....

The only expertise is needed is the connections and laying and the bulk of the work is just digging.....

Iam thinking if 80% is just digging and the rest is connecting why so much??!???

Because you are using up a plumbers time digging a hole when he could be making more doing something else. He is not dropping his price because you are to lazy to get someone else to dig the hole.
 
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