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Up Topic Welding Industry / General Welding Discussion / Questions? whats your rate? hourly? Am I online?
- - By Cumminsguy71 (*****) Date 11-14-2008 02:09
If you don't want to be specific ok. I have been doing handrail, stairs, light stuff and such. Maybe getting into some equipment repair, buckets and all of that stuff.

One guy I have done some work for tells me that one welder that did work for them in the past charged $80/hour. I told him I could'nt hammer him that hard for it so I have been hitting him with $55/hour. I normally don't charge him for grinding wheels and minor stuff like that. If it's a bigger job I'll hit him with welding rod or wire or mig gas. But that's not the norm.

I did a set of stairs in the last week and because I have done work for this other guy before and two jobs prior I charged him $40/hour. In the end, my hours total for the job were right at 70, I bid out 70 so I was a shade to the plus side....very little. They got some other bids and they were well in the $14000 range, mine was 7500.

Now that I think about it, what I have to pay my welder for 70 hours of labor, tax that leaves around $1000 for the business, then make truck payments, $850(2) and then have very little to run around on for the next job.

My brother in law drops his jaw when I tell him I charge the one guy $55 an hour and warned me against trying that with this other client. They won't know and as I told my wife and a friend, he's a carpenter and has his own tools. I weld, have my own rig. He don't have to get certified in every type of crazy situation. He throws a few nails in and there you have two boards put together. Not that simple as you know as welders.

So, I'm kinda curious as to what the average handrail, stair guys are getting so I can compare what I've been charging. I did a residential handrail a couple weeks ago and beat out a guy using "prefab" bolt and screw together handrail. That was hard to do and did ok, but underbid it. But its harder to sell something like that to a residential person versus a commercial application.

My insurance is $2800/ year, that truck, theft of tools, liability and $750 for workmans comp that won't cover me and will cover my employees........which I don't have. But it is a no option thing in Tn

So is my $55/hour inline? I typically feel pretty good about that when I do a job and get paid. Have a bit to put in the business savings account for repairs and so on. Talking to my B-I-L he's telling me painters, master carpenters, electricians and such don't make that. I think he's thinking I pocket 55 an hour. I pay myself around 18 and hour when the job is done.

What are your thoughts?
Parent - - By Cumminsguy71 (*****) Date 11-14-2008 02:10
Oh, the two jobs before when I charged 40/hour I had a day job so it was more like extra money, not a survival business thing.
Parent - By Johnyutah (**) Date 11-14-2008 03:08
Cumminsguy I for one think your shooting yourself in the foot to charge anything less than 65 per hour if you supply be competitive lets all make some money.
Parent - By uphill (***) Date 11-14-2008 03:45
Cummingsguy,
I dont know where you live but money goes farther in a lot of places. I did some aluminum floor replacements at the twin cities airport for a food service freezer a few years ago and charged $80 per. The company that hired me went off the deep end and tried to cut it to $60. After some arguing and some loud discussing they paid me. Found out on a return engagement they were charging $110 per for outside services. Ever since I try and keep up on the prices even if I dont get a lot of calls. I dont run the truck full time so its an expensive hobby for now. In the MPLS area prices vary a lot, some of the bigger shops are at 105-115 for field services.
I do a wide variety of repairs and not enough new building. Welding clean steel with no paint/oil/rust scale is almost like getting a day off comparing to reworking a trench box packed full of sand and clay. Bucket repair has gone through the roof. Two years ago I sent a 6 yard 245 cat bucket out for a major build. They replaced 1/2 the sides, new cutting edge and the bottom. The bores did not get redone. The bill was over $9400. I figured the materials at $2800, thats a lot of labor. New was $14,500
I would much rather get a fair rate and get paid uppon completion. I dont know if you can add on enough for slow pay.
Sorry if i went a little stray.
Dave
Parent - - By sbcmweb (****) Date 11-14-2008 03:49
Man, this topic has been beaten to death on here. Not saying the question is without merit, but lots of drama has erupted about acceptable wages & you get lots of different responses.

I would not even do anything remotely hard for ANY less than $60 per hour with a two hour minimum & they supply anything over a couple pounds of rod, plus comp me for my gas, materials, etc. Of course, that's here in Michigan for general contract T&M labor. Here, the way the local economy is, it really doesn't support much more than that. Not when there's a hack around every corner working for $35 per hour. I learned the hard way on a few fab jobs years ago & have found that beating out the competition with a low price is really a good way to wear yourself out & come out owing yourself at the end of the day.

Most people never think about how big a part logistics & minor consumables add up. Those are the things that sap the profit out of the job if you bid too low. Especially if you run into problems & the time starts slipping away. You should never have to split hairs to come out ahead by a razor thin margin at the end of a job. Think of it like this:  If your estimate is HALF of several other estimates from reputable companies, YOU ARE NOT CHARGING ENOUGH!!!!!

Especially if you don't have to weld to make a living & have a 9 to 5 to cover the bills. Even if you do, don't shortchange yourself. You'll get little respect from those kind of customers, just lots of grief & headaches. Not to mention, you'll probably come out over time & way over budget on cheap work. Any time you got to watch the clock, praying you make it under the estimate......You're screwing yourself.

Your time & effort are VERY valuable assets, not to be squandered on crap paying jobs that turn out to be a headache every single time. Believe me, I've been there, I know.

Good luck. S.W.
Parent - - By Cumminsguy71 (*****) Date 11-14-2008 04:31
thanks for the replies guys, this is my fulltime gig now. Got tired of the other guy/employee thing....heck of a time to decide that. Actually was laid off so not my decision.

Yeah, I saw that I was half price and when I figured it at my $55/hour it was still lowballed in comparison but I know that extra money would have made me feel better at the end of the day, not greedy feel better but better about the compensation= to the work involved, this make sense? I've planned on the next job, I have two this same guy is talking to me about, one not so big and one big one. I'll just have to stick to my guns at the 55, better if I just keep my mouth shut though with my brother in law and just let them know what the total bid is and not discuss what I'm charging hourly, cause then I have to try and explain/justify it compared to large companies that have employees and big fancy buildings and all those employees. It's not my problem they have to have large buildings and overhead, my office/shop travels and my shop at home is well, at home. Less overhead but performing the same services.

Again, thanks for the replies.
Parent - - By sbcmweb (****) Date 11-14-2008 05:00
One word about hired help. It's absolutely NONE of their business what you are getting on the job. If you are the one putting up the machinery, equipment, liability, etc & all he is doing is showing up......You owe him no further explanation.

Tell him he can make your insurance payments for awhile, or pay for the next major repair on your welding machine if you encounter a problem. It's easy for an armchair quarterback to be calling plays from the comfort of home, with a brewski in his hand. Working with relatives can be tricky sometimes. Just don't let anyone screw you around on your time & labor. You should be getting paid for what you know how to do, not only what your two hands can put together.

There's nothing greedy about having a competitive rate, regardless of your equipment fleet size or overhead, as long as you are on par with quality work the big companies with experienced hands charge. Being reasonable DOES NOT mean you have to be a doormat for second rate, cheap shot hacks looking for a quick fix. Those kind of customers are the ones you want to totally avoid. They are always trouble & usually are the ones to complain the most. Keep your rate high enough to keep the riff raff away & discourage would be cheapskate customers from even contacting you. A lot can be said for doing a quality job & making a good wage for it.

Like I said before, the cheapskates will never have any respect for you or your knowledge. They will simply exploit it & abandon you for the next cheapest hack that comes along offering their services for less than you.

Again, best of luck to you! Steve.
Parent - - By Ringo (***) Date 11-14-2008 12:30
You got that right Steve,If you want a good welder you have to pay for him.The knowledge you get through the years comes at a price,and you have to charge for it.Sometimes I think I should raise my rates from what I hear about what other people charge,but I always get complaints from the guys who hire me saying it's more thatn what they make,and they're in management,I usually say "then why don't you weld it".
Parent - - By sbcmweb (****) Date 11-14-2008 13:07
Good hearing from you Jim! Been awhile!

I have found, even from my limited experience that those kind of customers aren't worth having around. Sure, I think we've all been there at least once, but you should learn from it & be more aware the next time you go out & bid a job.  Eat a few jobs & walk away feeling like a slapped around crack whore, you get wise to the fact you are charging too little & either fix it or be constantly in the hole because of it.

Some people have so little respect for themselves & their work, that it just doesn't matter. They do not "pay themselves" first. They figure labor is really not the biggest piece of it when in fact, it IS!!!!!!

I have grown to believe you are paid for what you know, not what you necessarily do. The overhead you have & out of pocket costs are a big factor too. Any time "Non Value Added" costs are introduced to a job, that also has to be taken into consideration. Starting your rig truck up costs money, driving to the site & back does as well. All the little logistics of a job can bleed your profit away real fast & it needs to be recognized & compensated for.

I'm not wealthy doing what I do for a living. But at the same time, I'm not cutting myself short doing crap jobs for nothing just to say I'm working.

FWIW S.W.
Parent - By Ringo (***) Date 11-14-2008 13:49
I hear you brother,I know you and I have talked about this in the past over the phone and how frustrating it is.I only work for myself part time,as I have a full-time gig in aviation.Maybe one day I'll go for it like you.Good to hear from you.

Take it easy,Ringo   
Parent - By bozaktwo1 (***) Date 11-14-2008 12:08
I look at it two different ways.  One, you're in a business and want to have a decent profit margin.  Making a profit is the number one reason for doing business, after all.  Two, you have to consider the beating you're giving yourself on the job; fumes, dusts, arc flashes, burns, aches and pains from crawling around in unnatural positions all day...it all takes a toll on you through the years, and you can't do it forever. 

So you can charge $55/hr to work, but what good is that if it's costing you $53/hr to be there; that's everything from health insurance to gas for the rig.  If it were me, I would figure my daily expenses, divide it by an 8 hour day, then cap a 10-15% profit on top.  There's your hourly rate.
Parent - - By MDG Custom Weld (***) Date 11-14-2008 15:54
Cumminsguy,
Your rate is a bit low, but in the ball park.  I have worked for $55 and supplied on small jobs where consumables were not really enough to account for.  I have also worked for $75 on big jobs were everything was supplied.  I like to average $65 for most misc work like the rails and minor bucket repairs and such.  If it's a total rebuild where your going to put in 100 pounds of rod and 2 tanks of gas, then being on the higher side is ok in my book. 
The reason most large companies can get away with the $100 plus is they don't really care if they land those misc jobs, and their overhead is higher.  In the one man show those misc jobs pay the bills and you have to price it to make a profit that will cover your overhead.  Like Steve has said, Michigan is hard up and we have a lot of 2 bit hacks that will roll with $35, but they are usually getting repoed within a year and we have to fix their crap.
One thing about the B-I-L, when was the last time a carpenter or master electrician showed up with every piece of material needed for the job at hand??  Usually everything is sitting there for them and all they have to use is their tools, and most of those tools do not run on fuel that they paid for.  As the welder, you have to show up with everything needed top to bottom.
Parent - By sbcmweb (****) Date 11-14-2008 16:08
Well said Mark!

S.W.
Parent - - By welderbrent (*****) Date 11-14-2008 16:18
I agree with Steve on several points,

1) This has been beat to death

2)  It is always going to be a delicate, controversial, and complicated Q&A.

3) There are so many things to consider: In AZ for the areas you (Cummingsguy) mention I have to be a licensed contractor (renews often $$), carry Liab Insur (1 mil or more-$$), Workers Comp ($$), Auto Insur for job site work ($$), pay Unemploy ($$), SS ($$), Shop Rent ($$), Overhead (power, water, sewer, phones, computers, welders, hand tools, consumables, fax machine, trucks, signage, saw, ironworker, air comp, etc, etc. $$$$$ !! Certifications with updates, WPS, Mill certs records, etc. ($$), Seminars to follow trends and code changes ($$),  Code books ($$$), Fuel ($$), Health Insurance ($$).   Need we go on?  Did we make our point ??  Don't forget any of it or you will not have any money to renew something down the road.

4) Now I can start paying myself- after I make sure the steel and employees are paid.  All bills get paid BEFORE I do.

5)  Bottom line:  In our area of AZ most of us that have been around awhile and intend to stay around are running $75-100/hr.  My rate is at a base of $85 but is variable depending upon many circumstances.  That generally includes standard consumables (grinding wheels, rod, wire, travel time is same hourly rate with no mileage as long as it is in our local area, gases for torch). 

I don't drop my rate much for any reason.  If they want NO problems with inspections, quality, service, etc. then they will pay for it. 

Things have slowed down but they are still keeping us busier than when we bought this shop 12 yrs ago.  Plenty of cutthroats out there trying to do the work real cheap and take away our business.  They won't last long, but will they outlast us? 

Anyway, there's my tiny two pennies worth.

Have a Great Day,  Brent
Parent - - By MDG Custom Weld (***) Date 11-14-2008 16:49
Your right, this has been beat to death...but every time this comes up a new spin evolves.  The last go round I believe was focused on pipe and drill chasers, and now in a completely different area of the country with completely different work type.  I did not contribute to the last few threads on rig rates because they were not doing the same type of work we do.  Now Cumminsguy's type of work falls in the same arena that Steve and I work in. 

You (Brent) have tacked on many of the other things that account for overhead that need to be considered.  The strongest point you make is #4.  This is the one that takes the cake and sometimes leads to the hardest challenges of running your own shop.  The last one in line for money is the same person that signs the checks.  So many people think this is the guy that has the deep pockets when it usually is FAR from the truth.

While I hate seeing threads that were pounded to pulp a month ago get resurfaced, this one has so many angles it still is enlightening.
Parent - - By welderbrent (*****) Date 11-14-2008 20:00
MDG,

What a lot of people don't understand is that if the majority of your work is done out of a shop, when you go out in the field you have double expenses.  Unless you have enough work and people to do both productively.  I run trucks and a shop.  When things are slow and it's just my sons and I it becomes difficult to do either one profitibly (?) because you have to maintain all the expenses for both.

Better make enough to keep it going.

Have a Great Day,  Brent
Parent - By welderbrent (*****) Date 11-15-2008 04:54
MDG said something else that finally sunk in,

I hope I did not sound overly negative about this topic being beat to death.  I have learned alot from the various posters on this site.  Sometimes the questions have just enough variety to them to bring about a different conversation.  Sometimes different members chime in to give it different character.  Sometimes it may be okay to have someone go to a previous thread on the same topic, other times it is nice to deal with their question personally.

Thanks MDG for the gentle persuasion.  Thanks Cummingsguy for the question.  Hope all the answers here have been helpful.

Have a Great Day, Brent.
Parent - - By DaveBoyer (*****) Date 11-14-2008 04:33
  If You are a home/hobby type shop working for friends and family, $35-$40 an hour is OK but You are not making money.

  If You are in business "for real" and have all the costs of a real business, pay taxes & etc. then You need to be in that $55-$65 range. You need to cover ALL the costs including amortization of Your equipment and it's repairs as well as Your wages.

  A little story: About 25 years ago a friend of Mine was busting My shorts about "His" guy welding for $10/hour. I think I was charging Him $15/hr. at the time, and I was one of those home/hobby shops [so was "His" guy]. I just happened to be there when the parts the other guy welded were being installed. They were a simple "U" shape 8' wide and 4' deep made from 2 1/2" x 3/8" angle iron. A 4x8 sheet of plywood was supposed to fit inside the angle. The open end was only about 7' wide from distortion, and when jacked out to 8' the other member was bowed about 3"-4" inches. He said "I can't believe it, He had them layed out on His garage floor, and they were right on." I told him "You got what You paid for" and left.
Parent - - By JTMcC (***) Date 11-14-2008 21:31
Just about everybody I've watched start a business makes the same mistake, they underestimate their expenses.
I think people should carry a small notebook around and write down every business expense as they go thru their day. It's easy to mistake cash flow for personal income. Knowing what your actual expenses are will tell you if you are charging the right amount.
Doing your own books gives you intimate knowledge of your gross, your expenses and what you personally are actually making after all the bills are paid. I've watched several guys going along thinking, and telling me, that they were making "nothing but money" when in fact they had a good amount of cash flow but after the dust settled they didn't have enough left over to stay in business over a year or two.
By the same token I believe a new business owner should do his own taxes. That's the only way to really know how to make decisions that will help your tax situation. You can't depend on an accountant to put this knowledge in your head. Lot's of guys give away money in taxes that they could of put in their pocket with a little bit more understanding of the tax code.

Welderbrent I was over in Chino V. last month doing a little work for PKS.

JTMcC.
Parent - - By JTMcC (***) Date 11-14-2008 21:59
I don't know what part of the world you're in, but if you're paying yourself $18 per hour, could you hire someone to do the work you do for that in your location? Find the work, bid the work, order material, do the work, bill/collect for the work, plus any office duties you perform? That would be my benchmark. $18 sounds low to me anywhere in the U.S.

Keep in mind when you pay a hand $18/hr. he actually cost's you quite a bit more than that. With no other compensation (ie fringes or per diem), that $18/hr. hand needs to be billed out at a minimum of $30/hr. That's just his payroll and doesn't include any welding machine/fuel, consumables/PPE, ect.
So if you figure you are paying yourself $18 then it's costing you at least $30 to pay the $18. Using your $55/hr. rate that leaves you $25/hr to maintain a truck, welding machine, consumables, hand tools, fuel for truck/machine, Insure truck, machine, tools, carry liability insurance, provide some health insurance and sock away a retirement, maintenanc/upkeep, advertise, maintain an office, plus a couple hundred "little" things ; )
Only when you put hard numbers to YOUR expenses can you accuratly figure a rate.

JTMcC
Parent - - By Cumminsguy71 (*****) Date 11-15-2008 12:08
Lots of good info guys. Been thinking about this yesterday while driving around and thinking of what I spend now. Yep, the 40 per hour won't happen again and a few weeks ago I was talking to a good friend and told him I was gonna start the $55 per hour for sure and have thought about $65 per hour and just never mention it to anyone other than my wife or best friend. All bids would be that, one big number. "how much do I make an hour?" "enough to let the business and me survive".
Parent - - By Sberry (***) Date 11-15-2008 21:51
I always like JT's take on pricing and bidding. When I first read this it seems if you getting 7500 and the competition is getting 14K something should be obvious.
Parent - By Sberry (***) Date 11-15-2008 21:59 Edited 11-15-2008 22:19
This is just me,, but,,, I always use the hourly rate to figure costs, when I bid the goal is to get that (necessary profit is figured which it the profit needed to stay in business) but I bid at 30% above rate.
Parent - - By welderbrent (*****) Date 11-17-2008 00:42
JT,

Small world.  That is literally my backdoor.  We do work out there often and clear on up to Ashfork and Williams. My shop is in Prescott Valley.  All of Yavapai County has become 'local' for us. Just got back from delivering a job on down to Scottsdale.  Couldn't get my truck to go past Cabela's without stopping.  What a drag.

Have a Great Day, Brent
Parent - By JTMcC (***) Date 11-17-2008 02:00
Yea I knew you were in PV. We were up in Flag a couple of weeks ago. I went to school in Williams. I live outside of Kingman now.
I kind of like that independant welding supply in PV, I can't remember the guys name but when I've worked there I give him my business.
I lived in Bagdad and Hillside before we moved up here.
My girls (4 and 7) won't let me drive by a Bass Pro Shop without stopping for a couple of hours, we haven't been around a Cabela's yet but it will be the same I'm sure ; )
They are absolutly convinced that we can't survive without a pontoon boat.

JTMcC.
Up Topic Welding Industry / General Welding Discussion / Questions? whats your rate? hourly? Am I online?

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