Replies

1. 
   sledgehammer | Jan 26, 2009 02:49am | #1

   I think you'll find most people that trim houses don't supply the materials.

2. 
   Piffin | Jan 26, 2009 07:42am | #2

   You can go broke quick thinking that way

   My labor rate is based on my costs, not what I spend on materials.

   I am going to spend roughly the same amt of time hanging a door whether it is a $200 door or a $2000 door.
   Crown is based more on how high the ceilings are and how many corner cuts than whether it costs sixty five cents a foot or fifteen dollars a foot.

    

    

   Welcome to the
   Taunton University of Knowledge FHB Campus at Breaktime.
    where ...
   Excellence is its own reward!

1. 
   Sphere | Jan 26, 2009 03:07pm | #3

   It may be coincidental, and I may be going broke, but in a lot of cases I have seen a ratio in some of my work ( where I DO supply materials, such as a built in or add-on like an island) that the cost of materials doubled, seems to equal my labor.

   Obviously it isn't a rule or anything I'd contract a price with, but just after the dust settles, it seems to be pretty close. Often that is my first step of a "by guess, by golly, by gosh..by WHEN?"  LOL It gets my pricing brain flowing before I start microscopeing the job and doing it the "right" way to estimate.

   I agree that the OP can't use a "formula" like that for much as your example clearly shows.

    Spheramid Enterprises Architectural Woodworks

   Repairs, Remodeling, Restorations

    

   They kill Prophets, for Profits.

    

    

1. 
   Piffin | Jan 26, 2009 03:25pm | #4

   The only guys I've known personally who advocated ratios like that for estimating were sitting on barstools more than working, never guys who were successful contractors. 

    

   Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!

1. 
   Sphere | Jan 26, 2009 03:44pm | #5

   Exactly. Add in the volitility of prices and cost of doing bizness and you have a time bomb.Spheramid Enterprises Architectural Woodworks

   Repairs, Remodeling, Restorations

    

   They kill Prophets, for Profits.

    

    

2. 
   JeffBuck | Jan 27, 2009 06:57am | #6

   well ... like Sphere ... I have noticed when I work backwards and divide everything out ...

   the old "rule" of materials times two added together ....

   usually seems to get me where I wanted to be.

    

   my Dad ran a profitable business back in the dark ages suing such rules of thumb.

   he's also install a kitchen for "list price".

   he'd send the customer to his supplier, they'd work up the order ...

   and list price is what he'd charge for the cabinet install.

   he got a 60% discount off list ... always made money on those too.

    

   for the basic remodeling ... materials x's 2 added together.

   btw ... I never understood why it just wasn't materials x's 3?

   anyways ... double your materials ... that's what ya wanted to make on labor.

    

   some jobs it still works ... some it don't.

   pretty easy to run through it a coupla times to get a feel for it.

    

    

   also ... if I could sit on a barstool more and work less ...

   I'd consider myself pretty darn successful!

   Jeff    Buck Construction

    Artistry In Carpentry

        Pittsburgh Pa

3. 
   JerraldHayes | Jan 28, 2009 02:58am | #7

   I am sorry but I think the idea that there is any kind of reliable consistent ratio between materials and labor costs that can be used to help estimate project costs is balderdash and a dangerous business idea to even think could be applied in tough economic competitive times like these.

   I'll reiterate wrote in a post here back in June (msg#105840.24):

   ...in May of 2004 in support of my reasoning for using a Capacity Based Markup (vs. using a Total Volume Based Markup) I did a study comparing 114 different remodeling projects to see what the ratios of labor to materials to subcontracting looked like and I could find absolute no kind of consistent ratio or correlation of costs that could count on in looking at remodeling projects so I'll echo what rlrefalo wrote (and some others here; dovetail97128, Jim_Allen (aka Blue), Ted W. wrote too) in response to you

   "...there are no meaningful, reliable averages, as each job varies too much. Until you can come up with them yourself, for the specific type of project, they aren't going to mean much."

   Indeed in the study I did the ratios of Material Dollars to Labor Dollars ranged from $1.00 material cost: ¢.20 labor cost to $1.00 material cost: $10.26 labor cost. And just the other day I was reviewing the P&L and and other financial information for one of the contractors I work with and did a chart to plot his labor material subcontracting sales for 2008 and if you look at the chart I defy anyone to tell me what kind of meaningful estimating ratios can be derived from it.

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   And given that I've estimated and job costed hundreds of projects over the years and our specialty is interior trim, architectural woodwork, stairs and railings I can assure you that there is no reliable ratio of materials cost to labor cost that you can apply to the mix of tasks you described (no stairs, MDF base, window stools w/mitered casing and aprons, hanging solid core doors and crown in every room). The problem is the ratio of material dollars to labor dollars for base installation is different from the ratio for window trim so and to further complicate the issues as your your quantity of linear feet of base and the quantity of linear feet of window trim vary in relation to each other the overall ration will be further skewed.

   If you are inquiring for a project you've been asked to bid on I think you might find Producing an Interior Finish Bid a good introduction as to how to approach it.

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   Edited 1/27/2009 7:52 pm ET by JerraldHayes

1. 
   frammer52 | Jan 28, 2009 03:04am | #8

   I was happy to see you respond, although Jeff's rule works,      sometimes, or until it doesn't>G<

2. 
   Svenny | Jan 28, 2009 04:46am | #9

   You're such a buzz-kill Jerrald! ;-]John Svenson, builder,  remodeler,  NE Ohio

1. 
   JerraldHayes | Jan 28, 2009 05:15am | #10

   Svenny – "You're such a buzz-kill Jerrald! ;-]"

   Sorry about that. But I'm thinking gawd wouldn't it be great if that was true that you could just total the material costs and double it? There would be no more data books, books on estimating methods, or estimating software anymore. All you would need is a adding machine or calculator with tape and you're done.

   There was a great old discussion over on Woodweb that I when I initially ran across it back in 2004 was entitled "Materials times x factor estimating is bogus!". They have since moved it from their forums over to their Knowledge Base collection of articles where it's now entitled "X Factor" Estimating and Why Not Further proof that estimating shortcuts are merely quick paths to poor profits. While the discussion is really about cabinet making the logic and thinking still apply.

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1. 
   skipj | Jan 28, 2009 06:06am | #11

   Good to see you again! You are completely correct of course.

   Remodel Example: 'We want to get rid of the fixture in the dining room, and put in six can lights.' Okay, lets get started. Assume that permits, license and electrical capacity issues don't exist.

   So, I have to remove existing, wire six new cans, repair the lid, texture to match, prime, paint and trim 'em out.

   Material cost: Sheet of drywall, six cans, romex, tape and mud, texture, couple of sanding sponges, trim for cans, bulbs. So, let's be spendy on the trim and say it's $20 per fixture, plus another $250? so we have material at $370.

   Labor cost: Anyone who would do this for 2xmaterials is starving. Anyone who would do it for 3xmaterials won't be in business long.

    

1. 
   JerraldHayes | Jan 28, 2009 06:30am | #12

   Skipj, good illustration. By any chance did you read "X Factor" Estimating and Why Not... yet? About halfway down the original poster Frank G writes about ordering a pizza:

   Back to estimating systems. If I went down to the local pizza place and asked them to make me a cheese pizza without cheese, they would still charge me the price for a cheese pizza. Even if you backed out the direct cost of the cheese, your labor really isn't impacted that much and it still costs so much to heat up the oven and pay your fixed costs (the people who tend the register, clean the floors, wipe the tables). So, even if you did get a credit for the cheese, overhead and labor (5 seconds to sprinkle the cheese) aren't impacted very much.

   If the owner were at the counter, he might humor me and say, "Yeah, buddy, sell you a cheese pizza without cheese for $15.89 instead of $15.99." However, if he were a very smart business owner, he might say "A cheese pizza without pizza is a special pizza. I have to give my cook additional instructions and input special pricing into my register. So, if you want a cheese pizza without cheese, the actual design time and register input costs me 20% more to make, which is $19.19. If you really want a cheese pizza without cheese, that's my cost. Want one or not?"

   I liked that too.

   For the jobs where we provide the materials material costs can typically run anywhere from 5% to 70% of the total job cost. I'll have to look through the records this week to see how many projects I can find where the mix is two times the material cost.

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2. 
   Sphere | Jan 28, 2009 05:45pm | #14

   Worse case.

   I have a pile of lumber , lets say its cherry 4/4 rough. It was free. It was a gift.

   Mr. J wants a table..how would you arrive at a cost? Replacement cost of the free wood? Last week it was 5.00BF, now there is a glut and it's 2.00$BF...

   I bring this up because I had a similar quandry ( for an instant only) when a prospective Mr.J had the lumber in the rough and an IKEA catalogue. He dogeared a page witha  microwave/TV cart for 89.00$  Says he has the wood, and how much LESS can I build it for...LOL Oh, but it also needs to be sized to HIS TV. About 2" wider.

   Yeah..lemme get back to you on that..Spheramid Enterprises Architectural Woodworks

   Repairs, Remodeling, Restorations

    

   They kill Prophets, for Profits.

    

    

4. 
   ChiefWiggum | Jan 28, 2009 08:14am | #13

   I did nothng but interior trim and cabinet installs for about 10 years.  I always figured the job based on how many doors and the complexity  in design.  Are they 6'8" doors or 8'?  Is it stain grade or paint?   HOw complex is the crown moulding.  Are there allotta outside corners or special angles??    In the case of crown moulding, are the cielings 8'  or 10' or  ???   All these things cannot be accounted for in a %.  To make a short story long, you need to look at each job differently. 

5. 
   cargin | Jan 30, 2009 06:29am | #15

   Doug E

   I'm curious.

   Why did you ask the question?

   And did you get your question answered?

   Are you trying to bid a job for the 1st time or are you a homeowner who wants to hire someone?

   Rich