You know, we have had a number of conversations on here since I've joined about whether to charge for our services. The way i figure it, there are several demographics on here.
Some of us are individuals working alone. Others, such as myself, have employees and multiple vehicles and a facility of some type.
Of the business owners, there are two types. (Maybe more, but this is what occurs to me.). There are those who are on the truck, and there are those who generally are not. I fall into the latter category.
In my business, I have every intention of growing it into something much larger. As such, I feel that the division of labor is such that my employees responsibility is to DO the jobs, and it is my responsibility to make sure they HAVE jobs to do. Therefore, when I send a crew to do a job, there are expenses that MUST be covered.
Fuel and insurance and maintenance on the trucks, wages and insurance on the employees are the direct expenses. The indirect expenses are a facility to work from, a marketing budget, an admin to keep things in order, and the list goes on.
The down and dirty of it is if I send guys to do a job, they have to generate $100 of revenue per hour. GASP! You are SHOCKED! How can Burly in good conscience charge that much?
Simple mathematics. I pay two guys to be on the truck. Lets say for the sake of simple math I pay them each $10 hourly. Lets add in FICA, FUTA, workers comp insurance and all the other alphabet soups that add to our costs. Again for the sake of simple math, lets say the additional cost is 30%. That means when I send a truck out it is costing me $26.00 hourly for wages alone. Now add in fuel insurance and maintenance on the trucks. I don't have good numbers on those, althought Liberty and Cory probably do, and I'm in many ways not a good businessman for NOT knowing what those numbers are. For the sake of argument lets say those numbers are $20 hourly. That's probably on the low side.
Now while I do my share of scrapping, and selling items we acquire, much of what I remove has to be disposed of, and there is a cost associated with that. Now we're already ay $46.00 per hour without disposal costs, which for most of you is usually not a factor.
Incidentally, admin, it occurs to me that this thread should probably be a sticky, it's going to generate some discussion on this topic! Any business worth it's salt generally tries to double its investment. So as you can see by what I have written, I am probably NOT CHARGING ENOUGH!
Yes, you are generating revenue by selling your scrap, and any items selling for more than scrap value. But are you generating enough?
I contend that even if you are a one man/woman with a pickup truck operating out of your garage, you need to be charging the SAME RATES or BETTER! If you are doing services for free, you are losing money!
The floor is now open for discussion...
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Originally Posted by BurlyGuys
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