Ek's Home   |   Forum   |   Chat   |   Electrical Links   |
	Subject - Productive Hours kiwisholland All you guys whose business is solely residential service, and especially guys using Flat rate. How many productive hours can I expect to get the first six months to a year? Obviously you don't know the market in my area, but any help would be a great. A plumber friend said not to expect more than 10 productive hours the first six months of a start up. Maybe up it to 12-14 after six months to a year. I'm trying to nail down my break even number and of course it all revolves around productive hours. Thanks! John A. Peters What! 10 hours a week? or what? Please clarify what the plumber said. One way it to advertise before you open. Take appointments for a month out. ("I can't get to you till next month") They will think your are busy and you can get it together by then. Why not just do bids on weekends before you quit your regular job? kiwisholland Sorry, I meant to say 10 productive hours per week. Actual hands on time, not travel, not troubleshooting. John A. Peters It does sound is low, since there are at least 40 hours (more like 60 or so) in a week. It shows why you need to gradually move in to the business, while either having a main job or having a good bit of savings. I think trouble shooting for pay is part of the productive metric. I wonder if he means that he is working full time in his new business, and that the other hours are spent in startup tasks like setting up his company policies, office and field procedures, parts and labor prices, filling out credit applications at the supply house, setting up a checking account, finding an accountant, buying Quick Books and a computer to run it on, along with a fax and a second phone line and a cell phone, yellow page advertising, getting invoices and other forms printed figuring out which flat rate book to use (or what), marketing and so on. It can take a quite a while to get profitable. Whew! How did I ever do it! A.Q. MONOLITH Does that sound really low, or is it me? kiwisholland I agree. I think with the Flat Rate package, your hourly rate is based on, in addition to overhead, tech pay based on total paid time. So if I pay myself for a 40 hour week, but only have 10 productive hours, each of those productive hours must be billed out high enough to cover the 30 non productive hours. The plumber said that with the flat rate system, 50% productive time is considered good. Eliminate drive time, chat time w/ customer, troubleshooting, lunch, break, bathroom, restocking, etc. I just was wondering, given this framework, do you think 25% is a good target for a start-up. John A. Peters We charge for many of those. Most flat rate books have at least a flat rate for travel, that is some times charged to a credit card before you leave the office. It confirms the appointment. Another FR charge for for trouble shooting (for sure!). A flat rate for estimating time. A flat rate for orientation. This means if they have plans or drawings or they live next door to me the total price is lower. Russell120 I read somewhere once that even in new construction (where you don't have all the driving around) it is fairly normal to only have 60% of the time be "actual installation." Material handling is probably the item that eats up much of the time. The easiest way (in my opinion) to improve productivity is to make sure your people know what they are supposed to be doing and make sure they have the tools and materials to do the job. Sounds easy, but it amazes me how many construction companies can't manage that on a regular basis.