Restoration prices?

Any questions or suggestions regarding restorations
jmvv
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Re: Restoration prices?

Post by jmvv » Thu 23 Aug 2018, 13:31

Rassie,

The way I do it is as follows:
I am a one man show with one workshop assistant.
I calculate what my total workshop overheads are (workshop rent, insurance, utilities, workshop fuel bill, my salary, my assistant's wages etc)
This amount I divide by 99 (22 hours per week times 4.5 weeks)
This gives me an amount that I have to generate per hour in order to make ends meet.
This amount forms the basis for my hourly rate.

When I have to quote on a potential project, I can only give an estimate based on the projected number of hours that I am going to spend on the project. Overtime is factored in to the total amount of time estimated.

I require a 25% up front payment with monthly progress payments invoiced based on time spent and dedicated purchases.
If he stops paying, I stop working.

If I run into snags as you open the can of worms, and it has an impact on the duration of the project, I discuss this with the customer and get their buy-in to the situation.

Third party work (engineering shops etc), I handle on a cost plus basis.

If a project is going to take up space in my shop while I have to wait for third party work, I factor in the area that the car will occupy as a fraction of my total floor space and that gets added to the cost. My reasoning is that the car occupies space that can be used by another income generating car.

I have space for four vehicles in my shop. Those four bays must generate 25% of the rent each per month.
If I am too busy to get to a specific car sitting in the shop, that is for my loss. The customer cannot be expected to pay for me not being able to work on the car.

I do not charge extra for travelling for a project, as that cost is included in my overheads calculation. I do charge for the travel time, though, as that is part of the project.

Special purchases are handled and invoiced on a cost plus basis where I require full payment up front.
Overseas orders are handled the same way.

I do not include shipping charges in the quote for overseas orders, as I have no way to quantify that.
I do give an unofficial guestimate of shipping, based on previous experience.

Shipping and Customs charges are for the customer's account. I do not add anything.
I send him the courier's quote, which he must pay in full to me before I arrange for collection by the courier at my supplier.
The same for customs duties.
Having been paid up front for the parts, I can pay my supplier when I place the order.

I hope this helps.

WCC
Posts: 115
Joined: Mon 23 Jan 2017, 20:45

Re: Restoration prices?

Post by WCC » Thu 23 Aug 2018, 14:18

jmvv wrote:
Thu 23 Aug 2018, 13:31
Rassie,

The way I do it is as follows:
I am a one man show with one workshop assistant.
I calculate what my total workshop overheads are (workshop rent, insurance, utilities, workshop fuel bill, my salary, my assistant's wages etc)
This amount I divide by 99 (22 hours per week times 4.5 weeks)
This gives me an amount that I have to generate per hour in order to make ends meet.
This amount forms the basis for my hourly rate.

When I have to quote on a potential project, I can only give an estimate based on the projected number of hours that I am going to spend on the project. Overtime is factored in to the total amount of time estimated.

I require a 25% up front payment with monthly progress payments invoiced based on time spent and dedicated purchases.
If he stops paying, I stop working.

If I run into snags as you open the can of worms, and it has an impact on the duration of the project, I discuss this with the customer and get their buy-in to the situation.

Third party work (engineering shops etc), I handle on a cost plus basis.

If a project is going to take up space in my shop while I have to wait for third party work, I factor in the area that the car will occupy as a fraction of my total floor space and that gets added to the cost. My reasoning is that the car occupies space that can be used by another income generating car.

I have space for four vehicles in my shop. Those four bays must generate 25% of the rent each per month.
If I am too busy to get to a specific car sitting in the shop, that is for my loss. The customer cannot be expected to pay for me not being able to work on the car.

I do not charge extra for travelling for a project, as that cost is included in my overheads calculation. I do charge for the travel time, though, as that is part of the project.

Special purchases are handled and invoiced on a cost plus basis where I require full payment up front.
Overseas orders are handled the same way.

I do not include shipping charges in the quote for overseas orders, as I have no way to quantify that.
I do give an unofficial guestimate of shipping, based on previous experience.

Shipping and Customs charges are for the customer's account. I do not add anything.
I send him the courier's quote, which he must pay in full to me before I arrange for collection by the courier at my supplier.
The same for customs duties.
Having been paid up front for the parts, I can pay my supplier when I place the order.

I hope this helps.
Thanks for the transparency. I think you are handling it in a fair and honest way for both parties.

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IndianaJones
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Re: Restoration prices?

Post by IndianaJones » Thu 23 Aug 2018, 20:20

jmvv wrote:
Thu 23 Aug 2018, 13:31
This amount I divide by 99 (22 hours per week times 4.5 weeks)
Yes, as WCC says, thank you very much for the transparency.

But how do you get to 22 hours per week? That would work out to a 4 hour and 24 min workday, assuming a Monday to Friday workweek.

jmvv
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Location: Centurion
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Re: Restoration prices?

Post by jmvv » Fri 24 Aug 2018, 11:40

Thanks I J, for pointing out the error.

It should be 8x5x4.5
for 180 billable hours

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Chev58
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Location: Durbanville

Re: Restoration prices?

Post by Chev58 » Fri 24 Aug 2018, 19:02

jmvv wrote:
Fri 24 Aug 2018, 11:40
Thanks I J, for pointing out the error.

It should be 8x5x4.5
for 180 billable hours
Quite correct, I ran my electrical business on the same basis with one exception - you are in business to make a living and allow for future growth/unforeseen circumstances, therefore I based my billable hrs on 120(allowing some room to make a profit and have a buffer in place for when times/work is though and not just keeping the doors open).
In most cases a good month resulted in billings around 160 hrs/month - all bills paid, staff paid and the surplus(profit) went into ensuring proper tools/equipment were always possible to purchase to further improve work and service - anything less was not worth keeping the doors open.
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First V8
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Re: Restoration prices?

Post by First V8 » Fri 24 Aug 2018, 20:25

That is were a lot of business owners doing work that needs to be billed out per hour and not per job make the mistake . THey look at each job and see a profit of X but then don't have the next job in place so your X becomes X minus Next Job . Plan , plan and more planning .
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RASSIE
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Re: Restoration prices?

Post by RASSIE » Mon 27 Aug 2018, 07:48

Thanks members. I got a fair idea that I start of wrong but not sure if car owners got an open budget so an estimate are what they ask. This part will never work so from next year I just will choose the cars as they come. Hidden rust and cost include a timeline is the enemy. Then as time fly your own illness as well as workers who have passed away caused major problems. Weather have taken Amanzimtoti 2 years in a row where all work had to be stopped. To make that time up cost longer working hours and crime took a big cut out of my pocket to protect and secure 1000's of parts. I got one LHD car standing for 17 years in a lock-up garage and the owner just disappeared. It is not the cars fault so I am looking after her. :(
Rassie.
First V8 wrote:
Fri 24 Aug 2018, 20:25
That is were a lot of business owners doing work that needs to be billed out per hour and not per job make the mistake . THey look at each job and see a profit of X but then don't have the next job in place so your X becomes X minus Next Job . Plan , plan and more planning .
http://www.rassiesauto.co.za/
“Cowboys do not ride donkeys”
“I will die driving a V8”

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Burnthosetyres
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Re: Restoration prices?

Post by Burnthosetyres » Sat 01 Sep 2018, 17:08

Yes the theory makes sense from a ‘business principle’ perspective.

Where I have an issue as a customer, and I’m playing devils advocate. So Rassie has 4 bays. My car is in one and I’m easy. Say Bay 2’s owner is anal. He visits 3 times a week and phones twice a week. He takes up almost 2 hours of Rassies time.

Every time Rassie is side tracked he is supposed to be working on my car and I get ‘billed’ for it but Bay 2’s owner is cutting into my hour.....

Every time Rassie has a smoke, goes to make coffee and goes to the loo, I am paying for it....

But I suppose that’s how the cookie crumbles.
And in the end if the job is done
On time and too a good standard we will buy another project and go the same route....:

Some shop owners employ no labor. I understand why but when he is driving around to pick up a part or sweeeps the floor it’s expensive labor.....

I suppose there’s no perfect business model here.

But if you want to get my back up is when I pay top dollar for crap work and have to have it redone.
'A Camaro is a little animal that eats Mustangs!'

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RASSIE
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Re: Restoration prices?

Post by RASSIE » Thu 06 Sep 2018, 09:23

I met a person in Bloemfontein 40 years +/- back in the good old days when I went from Klerksdorp to Bloemfontein to buy a T top for my 1981 Pontiac Trans Am. His name was Gene and he had a workshop. He did what I have never seen before. If you talk to him or he was called for a phone call he put the time on the work card on the cars windscreen and record time when he start to work on the car again. Never ever seen this in my life. I think this is the correct way to work!!
Burnthosetyres wrote:
Sat 01 Sep 2018, 17:08
Yes the theory makes sense from a ‘business principle’ perspective.

Where I have an issue as a customer, and I’m playing devils advocate. So Rassie has 4 bays. My car is in one and I’m easy. Say Bay 2’s owner is anal. He visits 3 times a week and phones twice a week. He takes up almost 2 hours of Rassies time.

Every time Rassie is side tracked he is supposed to be working on my car and I get ‘billed’ for it but Bay 2’s owner is cutting into my hour.....

Every time Rassie has a smoke, goes to make coffee and goes to the loo, I am paying for it....

But I suppose that’s how the cookie crumbles.
And in the end if the job is done
On time and too a good standard we will buy another project and go the same route....:

Some shop owners employ no labor. I understand why but when he is driving around to pick up a part or sweeeps the floor it’s expensive labor.....

I suppose there’s no perfect business model here.

But if you want to get my back up is when I pay top dollar for crap work and have to have it redone.
http://www.rassiesauto.co.za/
“Cowboys do not ride donkeys”
“I will die driving a V8”

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Burnthosetyres
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Re: Restoration prices?

Post by Burnthosetyres » Sun 09 Sep 2018, 11:02

Hey if you phone your lawyer for advice you get billed 😂😂
'A Camaro is a little animal that eats Mustangs!'

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