Say that I have a renovation (read: ressurection) to do on a portion of someone’s home. If I were going to do that job T&M, how would I go about figuring the markup on materials, subs etc? I’m assuming by % would be the easiest, but what is that? I’m sure it varies vastly by region. Is there a good reference to get to help me figure that out? You may ask, why do the job T&M? Well, being a renovation there’s bound to be snags and hidden costs, even if you think you have absolutely thought of everything, down to the last finish nail. But, how would I proceed if I wanted to do a contract price? Markup % would be the same, or higher, to cover unknowns? This is assuming the client can figure out all the gory details before the sawzall starts buzzing. Anybody have some good thoughts, stories on these questions, please let me know. Or if you know of good reference mats on these issues, I’d be grateful-
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I have done a good bit of t&m, scooter, and I've never had a customer flinch at 20% profit mark-up on the total job (not including permits). But that's profit. I still have to recover my overhead in my labor price.
Free the Sancho!
scooter.. i still prefer Fixed Price.. and yes it is priced higher than T&M
on T&M.... the key is having your job structured in the labor rate...
then you can go ahead and markup Materilas adn Subs as you see fit..
the Insurance industry accepts 15% overhead and 10% profit without batting an eye.. so that's what we use..
however.. your real pricing is on your labor rate..
you have to know what your company's overhead is
you have to know your labor burden
and you have to know how much money you need to make (want to make ) ..
all of that gets rolled into the labor rate..
i use one rate for everyone... some break it down to laboreres , carps, lead men , supt... but you leave your self open to second guessing by the owner.
T&M in general leaves you open to 2d guessing by the Owner.. which is why i prefer Fixed Price... you make more money , and the Owner knows up front what the cost will be..
if you have unknowns.. you can always cover them by exclusions or allowances