shop owners lets talk about eating hours

I am a young hottrodder thinking about starting my own shop.. I've worked in the biz my whole life and know that eating hours is a price you pay in the auto industry when working with costomers.. my question what's a respectible amount to charge on a weekly basis for custom hotrodding.. we all know 50 hours a week sounds good but you can't charge for shit happening . Wut y'all think. `~aaron

 

the most basic answer is that it is up to you and your customer to come up with a compromise on "questionable" hours.

I would contend that EVERY hour you spend on a customer car is a billable hour, but sometimes it just doesn't work that way.

communication with the customer is HUGE

 

Come up with a build plan per vehicle, and sit down with the customer so both of you can agree on what the finished product will include.

I know I'm new to the HAMB but I had my own shop for awhile. On one project in particular I started metal finishing a frame for a customer. The budget didn't go up, but my ego did and I finished the frame the way I wanted it done. In the end I was working for $20 an hour...

Live and learn.

 

I try to put out 25 hours bill-able a week. I work alone, so everything else just eats into your day, fourty bill-able hours would be a LONG week for me..but Id make some solid money!!

 

I eat a lot of hours! In the average day, I am at work for 10-11 hours, but in that 11 hour day I usually only get about 5 or 6 chargeable hours. Between answering the phone, eating, ordering supplies, shop tours, dealing with customers and keeping my 4 employees on track it can be hard to get any more chargeable hours in.
Also, I will not cut corners and lower my quality to fit into someones budget. Therefor I end up eating hours that way too. If a 1/4 panel should take around 10 hours to weld in, and I decide to spend 15 hours on it to metal finish it and make it perfect, well I still only charge 10 hours.
I also keep close track of how long my employees spend on each project. I pay them hourly, and demand top quailty out of them. And with that sometimes they will be 5 hours in to something, and screw it up, or it's not as good as it could be, and I'll get them to start over and redo it. There's 5 hours I just ate. I still pay them their hourly wage for the 5 hours, but I do not charge the customer for that 5 hours.
On average it takes us about 1200 hours for a complete build, of that 1200, I usually eat about 200.

 

So whats the average charge for an hour of car building?

 

and when you build a car for someone, or make major modifications to it during the build always get the customer to sign off on it in writing or you could lose your ass real quick..

 

the trick is to charge enough to cover the hours you eat. I probably bill about 25 each week.....

 

The flip side of the question from a customer's point of view; there's no way I would expect a shop owner to eat hours if he was up front about problems that he did not anticipate. I prefer a time and materials deal rather than an estimate. Too often, when a builder has to eat hours, resentment creeps in and it's a "lose, lose" situation.

 

My friend operates a restoration shop. A lot of his jobs are time and material. His main responsibility is running the shop, everything but book keeping and payroll which he subs to a service. His primary shop duty is finish painting, as far as fabricating,, welding, straightening, he leaves most of that to his techs, usually two or three depending on business. For non crash work ( he does collision stuff as well) he uses a vehicle log.

His techs keep a log of the time they spend on each operation of the build. The log stays with the car and each person who touches it must log in. He tries to consult ad review with customers every other week unless something special comes up, then he calls the customer in for a consult.

He also suspends work, and starts storage charges if the customer dead beats on payments. He tries to keep customers on a 30% upfront and 60% of progress time, billed everyother week. New customers must pay for parts as they are needed and before they are ordered.

You may have a passion for your work, and doing a good job for your customer, a lot of customers do not have the same passion for paying for your work and supplies.

 

Communication is the key. As deto and brucer mentioned, hours, work performed, and end product, should be communicated by both parties, so the expectancy can and will be reached. When an unknown problem/situation arises, that changes the original quote, a stipulation will need to be reached, and signed off on. There should be no surprises. There are a good many talented/skilled shop owners in their craft..but often they are not good business men. Good luck to you.

 

I was owner of a shop with a partner for several years. I always had a problem with my partner charging too much. He would say that if he own worked on one car all day long then he could charge from the time he walked in the door until he turned off the lights.
Then if he was trying something. Even if IT did not work he wanted to charge for redoing it.
We Disagreed, We closed shop.

I feel a customer is paying for your Professional Experience and Skill. Not for you to learn or try to do stuff. Not for you to Talk about stuff, Not for you to fix your air gun. etc. etc.
Work time is Work time. You only eat your own wasted time.

 

I'm an apprentice auto upholsterer my boss sometimes uses a time card and actually clocks on and off the long term project he's working on as the amount of distractions/ phone calls make keeping accurate records rather difficult.

 

Our eating hours are from noon to twelve thirty. We're all old guys with bladder issues,so we've found that our peeing hours are more important to us. Peeing is allowed at anytime.

 

Amen, Don't bit the hand that feeds you.

 

I keep up with the hours on every job I do. On the long drawn out stuff, I keep a legal tablet under the windshield wiper blade and write down all the hours and with some customers what I did during the time.
When the job is done, I usually give the customer a break on labor rates or just knock a percentage off the total bill. The stuff I do twice, I bill for once unless it's something the customer has changed or added too.
As far as shop rates go, I try for $50.00/hour, but it doesn't usually work out that way.
Larry T

 

I've worked for myself for the last 20 years and at least in the custom paint/pinstriping/lettering biz your always going to eat some hours. If their a good repeat customer, friend or someone who tells me to do what I want i cut them some slack, sometimes maybe to much. I was told that people who are creative think with the side of the brain and that makes them poor business people. Thats why artists hire agents. I think this is true becouse I asked my lawyer one time, why he charged me so much? He said, Nick, when I get up at 3 in the morning to take a piss and I think about your case, well that cost you 50 bucks! when you call me to ask how the case is going, and I have to get on the phone, well thats another 50 bucks! It all adds up kid, thats how professionals do it!..........GOOD GRIEF

 

I am coming from a different angle. I do not own a professional shop. I have a garage and I mostly build my own stuff, but in the past I have done work for others. In all those cases I was either installing/upgrading parts whether it was swapping to performance parts, or adding a blower or doing some tuning on someone's car, and in other cases I did custom fabrication and custom turbo installations/fabrication. In all cases I made a quote on the job and I did the work for the quoted price. Even if it took a lot longer and a lot more hours than I originally anticipated. When you quote a job and you start adding more charges on top of that, you will get a bad name going very fast, so I have stuck to my quoted prices very strictly.

I have done work that ended up paying me less than $2.00 an hour because of this, but I did quality work that I was not ashamed to put my name on, and when the customer sees what all you had to go through and you still did not charge him more than you quoted, then you start to get a reputation of being someone that stands by his word. In time you will not have to "eat" as many hours because you will be more familiiar with what you are doing, but if you are figuring out any of it as you go, then you definitley should know ahead of time that you are going to "eat" a considerable amount of your time.

Now on something as huge as building a car, I would think you would want to do a time and materials type of setup with the customer, unless you are very good at building cars from the ground up and have done many in the past just like the one you are about to do for a customer. In that case, you would be able to be very acurate with your quote, and you could quote that.

I feel the same way as someone stated above - that you should not charge someone for the time you spend learning how to do something. If you are charging someone, they expect you to be a professional that knows what you are doing already! If you are learning how to do something that you are doing for a customer, and you don't get it right the first time, then you get to eat that and chalk it up to your educational costs. You will have educational costs whether you find a school that teaches this, or you learn it yourself on your own, but it isn't the customer's fault that you don't have the knowledge or skillset to do work that you have convinced a customer you can do.... unless you have that understanding with the customer before hand. If the customer doesn't mind you charging them to do something over and over again until you figure it out, then you are a lucky person to have that customer!

 

Flat rate is the only way to do it. Figure how Long it should take you to do something and what you would like to receive for an hours work. hen you can figure a flat rate. if it takes you longer you loose but there will be some that take you less time and you'll win. it all evens out as long as you can stay busy.

Always put out the very best product that you can. In the business you wish to pursue reputation is everything.

 

Non billable time is a concern for every type of service business that deals directly with the public. If you find that you are not able to charge for 15 of 40 hours of your week you have a serious problem. Granted, some may have fallen into a pattern of comfort and have reluctance to change, but if you can trim that number by 5 hours per week for the course of a year you will be a happy guy.
One of the best ways to compensate for lost time and expenses is through proper markup of consumables.
Another problem is that you generally cannot charge for consultation time. This has to some how be placed into the margins of your hourly rate.
It is also important to know who you are in the area, are you the hack who does cheap work to survive and cuts corners, do you have the customers of a hack? Or are you the artist who does the best work possible, do you have this customer base.
It is important to maintain a certain quality of customer, if you do work for cheap people to accommodate them and eat a lot of hours and hurt your self, you will be rewarded with the business of their friends who may also be cheap asses, If you trend towards people who expect quality and enjoy a quality product those people gravitate towards like minded friends. Let the hack slowly take these people from you, and you can slowly take his customers that are sick of shitty hack work.
These are tough times we are in, that makes it all that much more important to study your operation, and make necessary corrections as needed.

 

I'd let you work on my car anytime just from your attitude alone.


Doc.

 

On a side note... IMO most "customers" either don't or simply can't understand what it costs to own and operate a shop or in most cases an actual business. Tools and equipment cost money as does the rent/mortgage, heat, electricity, insurance, etc., etc., etc. Add in a few employee's and the cost of operations add up even more quickly. At the end of the day... the shop owner needs to make a living as well. Over my 20+ years in the automotive repair industry I've heard far too many people whine and complain about the hourly rates most places charge... they can't understand why parts need to be marked up or why materials cost what they do. In closing if you ever have someone ask why you charge what you charge take them for a little tour and show them what it takes to be in busine$$... I can almost gaurantee you by the time you are finished they'll realize that $50 an hour or whatever you charge isn't actually as bad as it seems.

 

Close to impossible to answer, and I've successfully ran my own shop for over 20 yrs. But, I will tell you this. WORK, don't dick around and expect the work to get done by itself

 

Treat others the way you would be treated. Start from there. As Scott would tell me years ago, "You don't get paid to learn". Amen.

 

...me too, what's for lunch?

 

The only time you shouldn't bill hours is when you screw up or a supplier screws up. If you made a mistake, man up, fix it and eat the labor - Plain and simple. Doesn't matter how big or how small. I once finished a $10,000 paint job and realized that the primer and color coat didn't like each other and started to lift in places. I had to strip the car and start over. Ate a good 40 hours, learned a lesson (and quit doing painting )
I did a Mustang II swap in a Jeepster, Ordered the crossmember from Fat Man. Followed the directions and fully welded in the crossmember. Went to weld in the spring hats and the angles didn't look right. After a little research we determined that Fat Man had sent a crossmember for a Jeepster with a different style frame, (there were two designs) even though the paperwork stated what we needed. Had to cut it all out, dress the frame and start over. Ate about 16 hours. Fat Man issued an apology and a discount on the next order. I ate the rest.
They call that the cost of doing business.
Our shop rate was $95.00 an hour and Most of my employees billed and honest 40 hour week. I was lucky to bill 15 hours of my own time. I did all the paperwork, calling customers, ordering parts etc so they could do 40 hours worth.
As for eating time, we generally only bill half rate while we are eating and split it between all the customers

 

A few years back, b4 I retired, I charged $1000 to race assemble a engine. Remember this is b4 the "crate engine" system we know and some of us love. My competition would charge $200 more for a "big block" assembly, I thought that was pure B.S., and 4 me, it was a grand across the board. Naturally aspirated engines mind you, blowers, turbo, nitrous of course the price went up considerably. Heres how this apply's to you, some times I would do the build in 10 hours, other times in 30. At the end of the year it averages out, no diffrent than a flat rate mechanic. Race engines or custom cars it doesn't matter. Now, if a customer changes the build in mid stream, well that changes the cost, and you HONESTLY charge accordingly. If something is beyond your control, such as a back order, a part not produced/machined properly, etc, again HONESTY, you cant charge him or her for something beyond either your or his control. Stop what you are doing until you speak directly with the customer b4 proceeding. A new or suspicious customer, ALWAYS put the new cost in writing and have him sign the work order permitting an OK ing the new cost. I always took the flat rate style of thinking in my business, you mess up, you eat it, and lose on one job and gain on another, at the end of the year or month fiqure out if your making money/or operating at a loss.

 

When I was working in the shops, retired now for several years, we bid each job, plus parts/supplies. Customer, Boss, and lead mechanic all committed to the bid.

Up front, when you don't have an idea on how to estimate a bid to run by the Boss, it's a learning experience. After the Boss agrees to the Lead Mech's assesment, then it's his job to confer with the customer.

My job was easy, just lead the mechanics! Boss had the hard job of negotiating with the customer and collecting. The shop ate all re-work too.

Dead beats? We ended up owning a few things, some of value, some not worth a shit in a storm. That's also a part of the process, not getting more time invested in someting than it's worth if you have to sell it...........

 

Good advice right there.


I never take enough photos, don't be like me.