Having recently just opened my small renovation business, I'm curious if I were to take on a bathroom renovation that's say 6x9 new floor, drywall, tub, vanity, toilet, tile tub surround painting etc, how much would I expect to make as the contractor? Is roughly $2000 a good number? Should I expect to make higher or lower? Just for my labour.
It depends on the quality really and the level of detail.
I would determine your hourly rate. From there I would just visualize how many days it would take you. 8 hours a day. or 7 whatever your preference. Then bill accordingly. So if it takes you 5 days. 5x8xhourlyrate.
To figure out a good hourly rate. Take all of your yearly business expenses or estimate your yearly business expenses. Phone, Rent, office space, work truck cost, internet, estimate software subscription, trustedpros subscription, liability insurance, vehicle insurance, tools, supplies, office supplies. The list goes on. Once you have determined these expenses you now have your break even yearly cost. Added your anticipated salary. Then add your company profit. That is your target revenue.
Then determine how many days you can work, with weekends and holidays, cousin joey's Bas Mitzvah etc.
That gives you your total hours in the year. Take your target revenue and divide it by the total hours. Bam you have your hourly rate.
It is a relatively safe billing strategy, especially when starting out.
Hope the info helps.
Thanks for the infor will try and determine that was looking at $25/hr starting out and then moving up from there.
Thomas is pretty much bang on. However, you're probably looking at closer to $55 or $60/hr once you've added all the stuff you need to...including profit.
I have been very recently in your shoes trying to figure out the puzzle. Feel free to contact me and I will send the information on a great resource that helps you figure out all the pieces.
If your charging $25 an hour your wasting Business oxygen and I suggest you go work for someone else.
Your now just a burden on real business.
It would also suggest you have no idea what your doing and this pulls a red flag for me.
$2000 is too
Everyone starts somewhere. In my opinion $25 an hour is a perfect starting point. Just note you wont be raking in the dough, but learning the ropes this way wont sink you either.
Just know what projects are above your head and be prepared to walk away. I would stick to projects under 5k max 10k. Also clarify and be honest to those hiring you. $25 an hour is cheap for a legitimate business that produces quality work.
But if you currenlty dont have wsib or liability insurance. Full set of quality tools. Quality home protection. Skills both on and off the jobsite. Management skills. Along with true business and communication skills. Understand that these are all temporary short comings and reflect the current value of your service.
Shoot for that demographic, those individuals that arr price driven. Within a year or two you will grow in your service and grow out of that demographic.
Best of luck.
I agree with these other comments. I would charge per square foot. Take in all expenses for the job (material, travel time, hourly working rate...) also it depends on the level of finish they want...if you have to do drywall level 3 or level 5 finish etc... $2000 seems like a low price and I think your shorting yourself.
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