True cost of doing business

Joined
Sep 7, 2008
Messages
3,797
Easy. Keep track of every dollar you make and every dollar you spend on your business. What you are left with is your real income. Employees, taxes, insurance, maintanence, chemicals, advertising, equipment fuel etc. are all business expenses. All of these must be factored into your price. The more expense you have the higher the percentage of each job will go to your true cost of doing business. If your overhead is low then factor in around 30 percent of each job as business expenses. I believe Harper said he factors in 70 percent. That means he only keeps 30 percent of the total gross.

Harper should have a better response.
 
Joined
Oct 7, 2006
Messages
18,838
Location
Benton KY USA
Name
Lee Stockwell
Secret: The biggest "cost" isn't money....it's YOU, your life, your family, your health, opportunities lost that can never be recovered.
 

John Olson

Member
Joined
Oct 9, 2006
Messages
6,281
Location
Orem UT
Name
John Olson
Figure out every penny you're spending a year. Now take the hours on your truck and divide it. That is your true cost for every hour you run your machine before you start making any money.

P.S. You need to amorize in what it would cost you per month to replace your equipment. This is one I see alot of peole forget when I have them run this excerise. Just because your equipment is paid for doesn't mean your making more money it means your putting more money away to replace it.
 

Desk Jockey

Member
Joined
Oct 9, 2006
Messages
64,833
Location
A planet far far away
Name
Rico Suave
Factors to include are Labor, Equipment (Tm), Materials Used, Vehicle, for cost of service.


Want more..... Maintenance/Repairs, Mortgage/Rent if you have a shop, utilities, insurance, taxes.

and I thought Art Kelly depressed me yesterday. :wink:
 

ACE

Member
Joined
Aug 22, 2008
Messages
2,513
Location
Lawrence, KS
Name
Mike Hughes
I have a nice excel spredsheet that will calculate profitability and a target hourly average given to me by Jeff Cross. Just contact me with your email address if you want it.
 

J Scott W

Member
Joined
Oct 16, 2006
Messages
4,061
Location
Shelbyville TN
Name
Jeffrey Scott Warrington
I have an Excell psreadhseet to calculate these costs. I should have never shared it with Jeff Cross. :(

I am glad to share it with anyone who sends me an email asking for it. You could even compare and see if Jeff is giving out the same spread sheet.
 
Joined
Sep 7, 2008
Messages
3,797
A better way to look at this is to figure out what it costs for your truck to just sit in the driveway/shop. Figure out what all and I mean all of your monthly expenses are from business to mortgage, health insurance, property taxes etc. and divide that number by 365 to get your true daily cost. Lucky for me my houses, equipment, trucks, and everything I own is paid for. My overhead is low but I still have plenty of taxes, phone/internet, maintanence, insurance, business supplies, etc to pay for. My biggest expense every year is fuel. Now that I have implemented a 20 dollar trip charge that is not an issue anymore. I just explain to my customers that I am an independant contractor and I can buy any tool or piece of equipment that I want and I choose to use the best. Sure I could show up and clean with a small truck or portable but since I choose to run a larger more powerful system I have a 20 dollar trip charge and will raise it to 25,30,40 etc over the years as fuel prices and chemicals go up.
 

Dolly Llama

Number 5
Joined
Oct 7, 2006
Messages
31,095
Location
North East Ohio
Name
Larry Capitoni
Carpet Cleaning Fool said:
It sounds important.

Can someone explain what that means and how I can calculate it?

Thanks,

I don't think you really want to know.
Our you might find out owning that POS V doesn't make as much $en$e as someone convinced you it would


..L.T.A.
 

Greg Cole

Member
Joined
Sep 30, 2009
Messages
1,554
Location
Kennesaw GA
Name
Greg
You can mentally masturbate on this one all night long. Subdivide, categorize, etx.. The easy answer is: everything that isn't your net profit.
 

joe harper

Member
Joined
Oct 21, 2008
Messages
4,992
Location
florida
Name
joe harper
This ThReaD is "ILLRELIVANT".............. :shock:


All of you fOoKer'S....are "UN-EMPLOYABLE"...... :cry:


"Just count your blessings"......That you were able to buy yourselves a job as a JaNiToR... :p


Ps...Other-wise...Most would be selling "FunNEL CakeS"...at the local FAIR.... :lol: :lol: :lol:
 
Joined
Mar 29, 2008
Messages
9,444
Location
Hawaii
Name
Nate W.
HARPER said:
This ThReaD is "ILLRELIVANT".............. :shock:


All of you fOoKer'S....are "UN-EMPLOYABLE"...... :cry:


"Just count your blessings"......That you were able to buy yourselves a job as a JaNiToR... :p


Ps...Other-wise...Most would be selling "FunNEL CakeS"...at the local FAIR.... :lol: :lol: :lol:


Man, I love some funnel cake!!!!!! Good stuff. :lol:
 

Greg Cole

Member
Joined
Sep 30, 2009
Messages
1,554
Location
Kennesaw GA
Name
Greg
Nate The Great said:
HARPER said:
This ThReaD is "ILLRELIVANT".............. :shock:


All of you fOoKer'S....are "UN-EMPLOYABLE"...... :cry:


"Just count your blessings"......That you were able to buy yourselves a job as a JaNiToR... :p


Ps...Other-wise...Most would be selling "FunNEL CakeS"...at the local FAIR.... :lol: :lol: :lol:


Man, I love some funnel cake!!!!!! Good stuff. :lol:

Mmmmmm, with whip cream and cherry topping..... Harper- do you deliver?
 

Latest posts

Back
Top Bottom