Buckle your seatbelts people, because in less than ten short paragraphs I’m going to teach you a thing or two about running a handyman business. So sit down, shut up, and enjoy the experience of this 4am, Red Bull induced, self hatred fuelled, writing extravaganza…
We get phone calls at all hours. We have to ‘nip out’ and quote for jobs at all hours (mostly at night). If we are lucky we can quote there and then but more often than not, we then have to return home and trawl through countless product guides, websites, price lists and the like, all in order to prepare a proper itemised quotation breaking down material and labour costs for the customer. All of this is unpaid work.
If we’re lucky, we get the job we quoted for, and we go to work on it. We make shopping lists of what we require to complete that job. We drive to builder’s merchants, and often with our own money, we pick up materials for said job. We prepare for the jobs we are about to start, while in the same day, we are often found finishing off other jobs. That’s more unpaid costs for us to contend with. Sometimes we have to chase up payments from earlier jobs too. We have to build and maintain systems to help us monitor our cash flow to help ensure a profitable sustainability. We need to employ and keep up to date book-keeping devices, calendars etc. and keep stringent tax records of all that we do. Again, this all takes time… unpaid time at that.
Then there’s spending time keeping up with best practices, current regulations, health and safety policies and the like. And for good measure, we’ll chuck in a few more unpaid tasks. Like the time it takes for banking, book keeping; time with accountants, time spent maintaining and clearing out the company vehicle, sorting our yard, paying bills, the list is often endless. There’s also marketing costs to consider, Time spent on the maintaining of websites, social media, blogging and the general making a nuisance of one’s self while networking in order to ‘stand out’, in an ocean of like minded competitors. We also have real costs to consider too. That fully equipped van wasn’t free, and nor was the fuel used in running it, it all has to be paid for. As do our tools, insurances, computers and stationery. There’s marketing tools, business cards, livery, uniforms, web hosting, etc.
They all come at a cost and all before we even earn a cent.
We then finish off the jobs we have won so that we can get paid for the time we have spent in doing them. And for that, we charge what is known as, ‘Billable Hours’. These ‘Billable Hours’ are usually only for the time it took to complete a job or the amount of time quoted for. Time wise, if a job runs over our time estimations, we don’t just finish at 5, we stay until that job is complete, 10:00pm? Then so be it, whatever it takes to meet your deadline. Likewise, if a job runs over our time estimations pricewise (and they quite easily can do), we don’t, under normal circumstances, get to charge for any additional hours either.
As you can see, there are probably as many as four or five unpaid hours going on in the background along with other direct costs for every ‘Billable Hour’ we can ever hope to charge for. A thirty ‘Billable Hour’ week, at this rate could take well over 100 hours to acheive. And believe me, it is in both our interests for me to minimise these costs for all concerned. But it’s not all bad news, because we also have what is known in the trade as a ‘Rate’. That’s how much we charge for a billable hour. And for that rate you get your job done to a fully compliant and satisfactory level as well as covering off all the aforementioned, for want of a better word, ‘unmentionables’ along with the additional safety net of a guarantee on any works carried out.
So how do we set our ‘Rate’ then?
The more professional among us already know about all the hidden costs to successfully running a handyman business and fully factor all of these costs into our ‘Rate’. That way, we know we can fully service your needs, make a reasonable profit and still be here to guarantee against any future call backs. We’re here for the duration and wish to offer realistic levels of service today, tomorrow and the next day. When setting our rate, we are effectively insuring a win win situation for both you and ourselves, covering against all eventualities and buying our way into the future. And in doing so, we are adding in value and peace of mind for our customers.
Others may charge what they think is the ‘going rate’. Usually they do no more research for their business’ costs than just seeing what everyone else is charging and come up with an ‘industry average’ to be reduced by a few dollars to create for themselves a false competitive edge and then sit back and hope for the best. This can lead to problems though. For example, maybe they think they don’t need marketing costs, after all, word of mouth is king right? But without constantly drawing in a wider customer base, will they still be around next year? Will you still have any recourse should the need arise or will you be left high and dry, trying to track down nothing more than another failed business statistic? These are usually the guys who will often seem de-motivated in their work, cutting corners wherever they can just to make ends meet, often working for less than a wage rather than running a sustainable business.
Many other handymen don’t really understand how business works at all. This lack of business knowledge on their part leads many to just “wing-it” with their pricing, often basing their decisions singularly on trying to be the lowest bidder, without fully understanding the economics. Their helpful nature often keeps them from charging what they should and leads them to give unnecessary discounts, not realizing that it’s actually hurting them and their ability to provide a quality service. These are the guys that often compete on nothing but price, run themselves ragged, quickly burn themselves out and too easily default to bad service. These are the guys who tend to quit half way through a job and leave you high and dry.
When the price isn’t right, nobody wins.
For many out there, properly pricing services as a handyman can seem like an impossible task. We have therefore knuckled down, studied the true cost of our business and firmly set our ‘Rate’ to accurately reflect it, along with adding modest markdown structures to sufficiently compensate the customer for any larger amount of works undertaken. Our pricing policy is particularly important to us. It’s important in getting us quality new customers, keeping our existing customers, and perhaps just as importantly, making ourselves a sustainable living!
Believe me, having been able to figure such things out before even hoping to trade, has already saved us many more unseen unquantifiable costs, like the cost of everyone’s wasted time, lost profits, too many unhappy customers, and many other equally frustrating time, money and effort consuming experiences.
So please, don’t ask for further discounts if you don’t expect corners to be cut.