Job Costing For ElectriciansBy My Service Depot on Tuesday, February 15, 2022
Becoming a part of the electrician industry is a good idea because of its extensive benefits.
Becoming a part of the electrician industry is a good idea because of its extensive benefits. It is an in-demand profession for people around the US and the world. Professionals in the field do not need to worry about finding a job as plenty of opportunities are available.
The industry allows professionals to learn specialized skills, and these skills become a must for a good wage. Statistics reveal that electricians earn around $300 daily. This includes a basic $30 hourly services charge and several other minor expenses.
What is Job Costing?
Job costing is a simple process of figuring out how much money it will cost to complete a job. These costs help clients and professionals determine what they will pay/earn, respectively—understanding how job costing works and knowing the right charges helps both parties in the long run. Therefore, let us talk about the reasons for knowing about job costing and why it matters.
Interestingly, the costs of charges of these electricians vary for each task that they need to perform. Therefore, it is difficult for most new electricians to determine their charge rates. However, there is a simpler way to do this. Let us begin the discussion.
Why Should You Know about Job Costing?
Following are the main reasons why you should know about job costing and why it matters in the long run.
You Need to Know How Much to Charge Your Clients
The biggest challenge for electricians is to know the right amounts to charge. These service charges determine if you will make enough money to continue with this work. Moreover, customers do not admire professional electricians who overcharge for their work.
You will not likely have a repeat client if you charge extra for your services. However, you wouldn’t want to do all that hard work to fix the electrical problems if it doesn’t pay off. Therefore, you need to consider job costing for each electrical problem to find the right amount.
You Need to Know How Much It Costs to do Business
Various factors matter in determining the business costs of each field. For example, the time you take, the kind of equipment required, and the dangers of a particular electrical fix contribute to the amounts you should charge.
Knowing the right price for each task you perform helps you preserve your financial well-being and make the profession worth investing time in.
We understand that it is a bit difficult for most electricians to understand and determine the correct prices. Therefore, we will discuss how to cost a job and what factors you should consider before billing a client for their electrical repairs or installations. Let us begin.
How to Cost a Job?
Costing a job revolves around focusing on various internal and external factors. However, there are different most of charging that you can choose as an electrician while taking your hard-earned money. Some of these payment types benefit you more than the client and vice versa. So, let us talk about them below.
The upfront payment is the most straightforward kind of payment method for electricians. It involves estimating the type of work that an electrician needs to do. You need to pick a flat payment for the complete work and get the amount upfront later.
This isn’t the best payment method for complex jobs for the electrician because it doesn’t consider the possible delays or extra time that the professional needs to spend.
Per Task Payment
A more practical approach is the per task payment that involves considering each task differently and coming up with a price accordingly. However, this also increases pressure on the electrician because they need to assess their fees for each task separately. Let us talk about the average prices for some of these tasks below.
Electrical Wiring Costs
Electrical wiring is the most basic task that professionals perform. You can charge somewhat between $6 and $8 on average. Most electricians exclude the wire costs and other essentials from these charges.
Installing Light Fixtures
Installing light fixtures is usually more complex than wiring tasks because they require reaching far off or in high places. Installing light fixtures may cost somewhat between $133 and $140 on average.
Upgrading Electrical Panels
Upgrading electrical panels is a bit more technical than other basic tasks. Therefore, you should charge a larger amount for it. These tasks start from $1100 and go as high as $2500.
Alternative power source installations like generators are a more advanced task and require taking care of technical damage chances. A single home generator installation can help electricians earn somewhat between $3000 and $5000.
Factors to Consider
Understanding the job costing for each of these tasks differs from task to task. They can start from a few dollars and range up to thousands on average. Therefore, we will mention some factors that help determine the right costs.
The simplest factor to consider is the size of the building you work on. The job costs are directly proportional to the size of the building. The more prominent the building, the more it will cost to fix electrically.
For instance, a residential electrical repair will cost much lower than an industrial or commercial one. The average price for these residential tasks starts from $150 and goes up to $500 on average.
Similarly, an electrical maintenance and installation task in the commercial building may stay from $500 and can easily range up to a few thousand dollars.
Building symmetry is a big concern for electrical tasks. It is because this contributes to the difficulty in these tasks directly. It is easier for electricians to work on buildings with a proportionate symmetry than others.
The non-symmetrical building is tougher to fix electrically because each end of the building requires a different approach for the electrical task. For instance, you will probably need to spend more time and resources wiring a non-symmetrical building than others.
The cost of material matters in the long run because the electrical professionals need to pay this amount from the total amount they make. The material cost varies for each task depending on the severity and detail of the task at hand. The basic electrical fixes usually cost a few hundred dollars whereas, extensive tasks cost higher.
The material take-off includes a comprehensive list of things required for a task. It is a common term used in the construction and building industry with different names. For example, it is also called construction take-off and quantity take-off.
It explains the approximate cost of each task that a constructer needs to accomplish. Or it would indicate the cost of each task that the electrician will take care of in this case. You can add it to the total material cost and get a more precise look at how it will cost your electrical repair and installation tasks.
However, it is also important to add the potential fluctuations in prices that may impact the total cost of your task as an electrician.
Electrical projects aren’t always single-man tasks. You will come across several projects as an electrician that requires a team effort. This means you will either work with other electricians or bring a team of your own. Either way, it will increase the cost of your electrical project.
It is wise to bring your team because it will help maximize profits as an electrician. The cost of the team will directly relate to their capabilities, qualifications, and level of expertise. We suggest avoiding creating a very extensive team. It is best to prioritize quality over quantity in this regard.
The time taken in an electrical project is directly proportional to the price of the task. The longer you need to work on a task, the more you can charge for it. There are a few ways to counter this problem.
For example, you can propose a bigger team to divide the workload and get things done faster. Fortunately, you can demand a higher work price for this favor, as the client needs it earlier.
These kinds of projects are most common with residential or commercial construction projects, where the constructors cannot afford to lose time. However, we suggest you discuss the details for this beforehand and come to a mutual agreement.
Distance plays a broader role in determining job costs. Working on a distant site will increase your expenses and time as an electrician. So, a smaller project in a nearby location can stay within $1,000. However, working on a distant, large-scale project would require spending extra time.
A significant concern for most electricians is the budget cushion. The budget cushion represents a safety amount or margin. This margin includes the extra expenses you may bear because electrical repairs can be unpredictable.
It is wise to keep a reasonable margin because you can cover unforeseen changes in the budget. For example, if an electrician thinks they can install ten light bulbs for $100, they may have to spend a little extra. The budget cushion keeps your earnings safe in these cases and allows electricians to work without compromising.
Job costing for electricians can be quite complex for first-time electrician workers or hirers because every task has complex requirements. However, a few factors like the time taken, the distance to the site, the labor and material costs, etc., all contribute to the job costing. Electricians can easily calculate an approximate amount keeping all these factors in mind.
We are sure you will have no problem deciding charges for your electrical task by considering these factors. You can always reach out to us if you need more information regarding job costing for an electrician.