Honestly there is countless stuff they should be teaching in school that is frankly unacceptable to not be teaching. I sure wish I were taught how to do taxes for example
@@cameronbartlett856 Our education system is absolutely pathetic. We have the "woke" teachers who only care about virtue signaling, not preparing our youth for the real world. I mean, we now have members of the dept. of education saying math is racist, they're teaching revisionist history and concentrating more on gender identity than life skills. It's just unreal. That's why I was happy when my boy decided to learn a trade rather than go to a university. The education system is a cesspool of ignorance anymore.
@@ourtube4266 what he is getting at is teaching you how to run a bussiness not just the math part. showing kids how to apply the math they learned is better than sayin hey look at this get it good TEST TIME. nothing more from the lesson
As far as the learning curve is concerned, taking photos of the jobs completed along with details of the bill of materials and consumables, time taken to do the job plus any lessons learned will make future quoting easier. A book for valued customers and suppliers and a list of blacklisted clients and suppliers to avoid in the future.
Good video brother! A recurring mistake i had to correct was bidding too low, and losing. Your natural instinct 8s that you want to give somebody a good deal and be low in price. But dont ripp yourself off by undercharging. I do custom ornamental iron and metal art. I have found that high end clients would actually be inclined to think lower price means lower quality. Charge what you are worth!
I remember pricing up a job once in the past for about £200 (cost), I later found that the sales guy sold it to the client for about £800, who then sold it on to their client for £1200. Ornamental / decorative work pricing can be bonkers sometimes.
A couple comments: 1) Don’t forget to add consumables and profit to the work you are doing in the field as well!! In these example, even if we time correct for the first example so that you complete widgets in the same amount of time (2/hr), if I am the guy hiring you, I’m gonna hire you to bring your stuff to my place, I’ll buy the material, and you do the work. After evening up the time and removing material, I would only be paying $17.58/widget if you come to my place, but $37.44/widget if you do it in your shop. Not trying to ball bust, just reminding that you need to remember consumables for your equipment and profit for the business if you are working at somebody else’s place too. 2) Good video and very sound advice. Remember most small businesses fail within the first few year of starting because guys don’t get this part right from the beginning. Getting your numbers right from the get go with ensure that you are making money and not just staying busy. 3) I agree that you should know what your local competition and market rates are. However, be careful just assuming that is what YOU need to charge. You may have more or less overhead. You may provide better service, etc. I work with contractors all the time and many of them fall for this trap. Know what YOUR business needs to make to keep the doors open. If you always just try to be the cheapest, will just be part of the “race to the bottom.” It is ok not to be the cheapest as long as you can show value to your customers that your competitors don’t. If your customers tell you that you are too high, ask them “Compared to what?” If they can’t or won’t have that conversation with you, they will likely never understand the value you bring...do you really want those customers anyway?? Again, great video! I wasn’t trying to pick you apart with the first point, just used it to illustrate how important this topic is for business owners, gotta know your numbers. As a person in business for yourself, this information is more important than knowing how to perform the work.
I mostly agree but you can charge too much, no matter how great you are. If the going rate for good service is $60 /hr and you want $90/hr, you will likely get few takers, even if you are the best, nicest, fastest, and cleanest person to hire. I have been self employed for 30 years.
Great Video! I cant count the number of times I've had to explain this to guys when they get pissed that I'm billing the customer 75+ an hour but only paying them 15-20. I do recommend figuring for like 30-35 hour weeks for coming up with your base line salary. IMO you will inevitable end up spending 5-10 hours a week doing things you can't bill anyone for.
I watch this channel to better my welding skills as a hobby.. But I also own and run a small bicycle repair shop and this video can go for any small business.. I realized a year ago that even tho I had the best prices around and a great attitude, I was severely cutting myself short. Raised my prices to be competitive and I still get business and can actually eat now lol
Put short & simple, if you don't know your TRUE NUMBER'S, your destined to FAILURE! Hello one and all, if your even on the fence about starting a new business watch this video, I don't care if your making widgets, or what-do-you-call-it's, this is the video for you. GREAT job Jason, the first comprehensive video I've ever seen of the subject (Machining / Machinist / Welding) of starting a new business. Thank you for sharing.
As new welder still in school ,obviously all the information to help me have a successful future in the business is helpfull .Not just this video but all the videos you and the guys post are always on my speedial for resourceful tips and tricks.BIG BIG THANKS to your team of welders.
Brilliant video that applies to other fields as well. As other commenters have said, this is the stuff that schools should be teaching. I study a field that has absolutely nothing to do with welding, economy, and yet I still feel like I learned useful things from this that will help me.
Great video. One other thing I add into bids is I put in a percentage for depreciation on wear items like machines, trucks, electrical tools and so forth... Most the time anywhere from 2- 4%. You are a awesome teacher, keep it up.
Another great video. You should consider a mark up on materials and subcontracting items to be used for the job. This will protect your profit and covers the cost of the management of sourcing supply.
You are 100% correct. That’s why we add the 20% consumables and 10% profit last so it captures every aspect of the scope of work. I probably should have stressed that point a bit harder.
This is such a well thought out video that is so informative. I can't be grateful enough for such information considering how I am starting off welding. I now have a rough idea over how to go about this when I am done with my course.
Excellent breakdown. I know I don't pick the least expensive contractor when getting bids, I pick the guy that returned my phone calls promptly, showed up on time for the bid, and wasn't pushy or arrogant.
I’m in NE Florida and about to go out on my own, and this video helped me tremendously. This has been my biggest worry, bidding jobs.. Great video! Thank you
Nice work on the video, when I was pricing small jobs just starting out. I forgot about the consumables and time designing, going back and forth with samples, over the year thats a lot of money you've lost out on, always remember, your time and bits and bobs to do the job . ✌
You really broke that down well. There are alot of people out there that do not look at the hidden costs and they wonder why they are losing money or barely breaking even. Great presentation!
Very nice breakdown. I rarely post but this makes sense. Thankfully I have a few friends with they're own business that helped me out but for people that don't this is a nice basic guide.
First rate in depth description and so clearly expressed tutorial that you have underlined a sound personal integrity to provide for sustainable growth and development. Thank you sir.
Never let anyone provide material unless YOU know they aren’t clueless. Shown up to many steel side jobs and dude has galvanized or aluminum/stainless hardware/hinges/etc.. They do that crap, you charge them for making you wait while they get the right stuff.
Thanks Jason another great video. You brought that down very well and what the operating costs are. I am really glad you’re out there to help us to make the difference in our lives keep up the great videos I appreciate everything and anything you’ve done on this channel keep up the great work you guys are doing awesome.
Good useful info. Two things I would add are that you never want to be too far below the average cost because people will not think you are any good. So yes you don't want to undercut everyone but it can also directly hurt you getting work if you are the low bidder. And I always add 10% contingency to any project. You kind of have that in the second scenario with the "profit", but you don't want to be hitting your profit too much with contingency costs. There is always something. If you want to get some smiles you can refund any unused contingency when the job is done.
Great video, and excellent points! Never go by what everyone else is charging because there overhead cost and other cost might be different. There are many people that don’t take this into consideration when pricing jobs, that’s why they won’t be in business long, and why there are so many (Low-ballers) out there. Charge what you need to, and your craftsmanship will sales the goods!
Thanks men. That was really helpful on learning how to figure out my hourly rate. Im trying to start my own welding business. I cant wait to start my business soon. As of now I'm taking notes in starting off before I began my own business. Again thanks
Someone once asked me if I do cheap welding. I said no but I know someone who does, but he's in prison for causing a accident that killed a innocent family. 🇺🇸💪
Great video, when you mentioned shop rates in Florida it blew my mind. For a welding shop here you can expect a minimum of 120 to 150 dollars an hour for shop rate. Mind you thats Canadian.
One thing I factor is if they want me to run a MiG or TiG job. For TiG I usually up charge about 10% on average. Unless it’s a massive job I up my work hours due to it being way more difficult and time consuming in most cases. Stick I charge less unless it’s a large job because I hate stick welding lol But for outside rough jobs I prefer it for minimal equipment and set up.
A welder and an automechanic make similar wages, so check the hourly charge-out rate in the local non-brand garages which looks like they are paying their taxes. Thats what you can charge. If it's a pure welding job base it on the weld in volume. If it is a structural job some thumb rules are: if the items are all over a ton (1000 kg) then 60 hours pr ton. If there are more than 12 items pr ton then it is 360 hours pr ton. Make a graph and draw a line between those two points. Most important is to have a network of other one man bands to use intermittently. Not only other welders, but specialist services like CNC, NDT, X-Ray, etc.
Figure 30 hours a week. That gives you 10 otherwise unpaid hours to do office work. Eventually you will spend 3 hours preparing that 20 widget bid and then not get the job. Most small businesses fail because they don't stay on top of the boring office work.
Most small businesses have to have family involved. And they also have to make no money! One or two people can't efficiently run a business. Like you said, the insane amount of time spent on quoting a job is non productive and your losing money!! That time can't be billed to another job so when you never hear back from the customer on a job you've spent a day or two on guess what, the company just lost 16 hours of production and lost the wages that paid the estimator. That's why I like small jobs. There's way more profit to be made and less time wasted on estimates. I'm glad you brought that point up
Yes and you have time ate up by customers that want to talk your ear off, you have to be nice to because they are your customers. And let's not forget the salesman that drop in and say " I know your busy but if I could have 5 minutes of your time bla bla bla" and next thing you know 45 minutes has past then when you finally get back on those widget's , drop your hood and strike an arc, the phone rings, you have to answer ( could be that million dollar job that you dream about) but of course it's a recorded message telling you your cars extended warranty is about to expire. You end that call, look at the time and it's 4:45 and you've only got half of them widgets done that they are going to pick up first thing in the morning. You think, I'll call them and see if they could hold off till noon. then you remember that Jason with Acme is bringing his trailer first thing in the morning for a new hitch and jack, and you've put him off twice already . . . Shit! It's going to be a long night.
tubeonline629 Story. Of. My. Fawking. Life. You eventually get good at quoting work, when people ask real short questions, they’re usually just price shopping. Then you need to think on the fly, is it something that is actually profitable or is it something that will be $100 in material, take 10 hours and pay $300? If that’s the case, over bid it by 50-75% and send the tire kicker on down the road. To some, that seems like poor practice, but giving up your time to do charity work, is practicing to be poor. There’s a cost to doing business and there’s mouths in my house that need fed, unless it’s for our church, I’ve stopped doing charity work. People also don’t realize that when I’m constantly emailing my steel supplier for quotes on material, there comes a point where I become an annoyance to them, constantly requesting quotes then not actually processing 80% of them. Really don’t want to be that guy, because they don’t know if you’re price shopping with them or legitimately just not buying the material. Looking back, I really wish I tallied up the time I’ve spent working up estimates, that have literally gone no where.....actually no, I don’t even want to know! Just glad I figured out a way to weed out the tire kickers, greatly reduced my time that was once “wasted time”.
@@NTK_FabWorks great comment bud! Just started a mobile welding business with another guy and the hardest part hasnt been the work, its the goddamn quotes lol
one major thing you didn’t mention in regard to contract work for aerospace/defense is some of the regs placed on the defense contractor who subcontracts out work. as a former procurement specialist (aka buyer) for a major aerospace/defense contractor, we (I) regularly negotiated with one-owner/small businesses for subcontract work. my company was required to request a cost breakout on bids from subcontractors, i.e. overhead rates/amounts, wage rates, administrative AND MOST IMPORTANTLY, profit margins. Basically, the main customer, the government, was diving into the s/c’s cost & profit structure through the defence contractor. HOWEVER, the savvy s/c’s KNEW there were exclusions to these requirements and regularly invoked them so as to keep the gov’t and prime contractor out of their business structure. By NOT invoking these exclusions, the s/c’s open themselves up to FULL scrutiny AND more importantly, can create a nightmare for themselves when trying to negotiate and make a reasonable profit. If you are contemplating pursuing ANY kind of business with the federal gov’t OR a prime contractor working a federal contract, it behooves you to research EVERYTHING about contracting or subcontracting with such entities.
I would also add in 10-15% extra just in case you forgot something and have to pay for it. I do computer work and have a set rate but I still add it " just in case" money because sometimes prices go up just before you order or you need more than you thought based on the actual site conditions. That 10-15% emergency money has saved me a few times when the client didn't do everything they were supposed to and I had to cover it to complete the job. Also make sure all the time you take to pick up materials is covered. If base cost is 35.15/hr I would just set a hourly rate of $55 or $60 because you won't always work the full 40 per week and that extra covers some down time. When I started back in the 90's, I set my rates 10/hr lower than the established businesses and haven't looked back. I started at 40/hr and now am 60/hr for in store work and 90/hr for onsite including Networking work. I am cheaper than many but only because I bought my location and have limited hours due to health problems. If I was 100% healthy, I could get $100-$120 /hr easily as that is the going rate for business work in my area.
In my working days I took the other side of the coin. I did like you but I figured out the costs WITHOUT my pay. That way I would add on my pay to my costs. I would figure what the job labor is worth and what the person hiring me can afford and come up with a per hour total number. Yes sometimes we work for free but the bills have to be paid so my costs would be the lowest anyone would see per hour, unless of course there's women, booze, or rides involved to figure in the formula.
Don't forget maintenance and upkeep, future replacement costs for the truck, welders, generator, and recurring training like maintaining your certs, and so on
I charge by the inch, steel/stainless/and aluminum all different. fitting/ cutting and drilling to, when l break down all this little costs to the client there is nothing to complain. When someone needs just “one” inch of welding l apply the minimum fee.
It's basically an "educated judgement call" based upon what you need to do to stay in business and to collect a nice salary from your business. Today, I don't know of any shop that does not charge less than $70 US Dollars per hour to operate and that does not count any mobile services they may offer. It also depends on what kind of welding services you offer too. I took welding and machine shop in high school and back then, they told us that your Tig welders will make to most money because it's an "in demand" skill. I'm pretty sure that 27 years later (yeah I'm old, L.O.L.) this statement rings true.
In this video you are JUST COVERING your expenses! What about the reason you are in business.... PROFIT! Here in the New York area I charge for Stainless TIG welding and fabrication $150 Per hour! Costs to do business mis very high hear. I Design, Cut and fabricate for restaurants, and show rooms. They are quite happy to pay just to get someone to do the work.
Great video. I would also take the materials times 1.5+- depending on the region one lives in. $600.oo was your cost. Need to make money off the materials the customer didn't supply. And don't forget to add taxes into the bid. Why eat into the profit?
I figured I'd watch this when I got another odd job... Days after you post* this one! Tractor log grapple, but unsure of which type without too much info short of the fact I'm building a mounting assembly to attach it to the bucket or the 3 point lift. 🤔 Wish I had the darn specs or model number to prep before it comes in the shop! A 14,000 lbs tractor isn't exactly fun to keep in the shop or the garage. I will have to pay someone to be the ballbreaker, I'm too nice to people!
Man i did alot of handyman/ranch hand work and the amount of people who wanted me to use there tools and stuff so they could get a discount was wild. Early on i thought "oh nice, no wear on my stuff, that would be great!" Only to get there and realize their bladed tools are all old and rusty, shovels and rakes all have dried out handles with loose heads that would give slivers 100% of the time, power tools were ancient or barely worked, chainsaws dull and barely ran, etc. To the point i just started telling people no, i will bring my own well maintained tools. As if giving me trashed tools i had to sometimes fix for them was doing me a favor 🙄. Or the other thing that makes me walk away right away is hearing "well minimum wage is like 15 bucks(washington) and since im paying cash you wont have to pay taxes on it so really its above min wage....blah blah blah". Lady if you want to pay me for my physical ability to cut a limb off that tree then fine. Pay up i will be done in a second, but fair warning the tree will likely die. Thats the going rate for a neighbor kid who doesnt know what hes doing, you are paying me for my experience i learned over many years, experience that will not kill the tree. You are paying me for my professionalism of not leaving a bunch of trash and yard waste scattered around. You are paying me to not take forever to get the job done. You are paying me more because im not a tweeker you can hire for minimum wage that will provide cheap service, but will likely come rob you later that week because you basically paid him to case your home. If i wanted to work for minimum wage i would go get a job at mcdonalds doing a super easy low skill job in an temperature controlled building where i get breaks and a free meal once a shift.
That is all good if you have already done the job because you know what you have used my biggest problem is when a customer comes in and asks you on the spot how much for a job. How long did it take you to learn “how long it would take to weld a job” as I find that very hard to work out for bidding on a job
The hardest part of running a welding business, getting paid. If you are going to start a welding business you better be ready to fight like a dog in the street. I was on my own almost 20 years.
@@billionsandbillions Doing field work is also super cool. I worked in the mountains and deserts and in city's and tiny town's. Very rewarding work. Met alot of super cool people.
The piece of advice I would add right off the top is bid like you are paying hired work. Can you hire someone for $20/hr? Probably not. If a company gets it and sends an employee out, the are allowing more like 60-80/hr just for the employee in the equations above. At least bid it closer to that than farther. my.02
Never underestimate the cost benefits. If you can’t make as much as a 9-5 you shouldn’t be in business. The problem in my area is people who charge half what I do because they don’t pay for necessary stuff like that. I have a strict policy of never using customers tools/equipment.
Thanks for the video on the first time I ever watched a video of yours and you know I basically kind of looked at it the same way but you did clarify futile see I wasn't really thinking about you much I appreciate that
One good tactic to ensure you're pricing competitively is to simply get a quote from a competitor for the job that you're quoting for, just give them a fake name so they dont know that you're a competing business.
Get a lawyer and an accountant. Consider a bookkeeper as a contract or part time basis until get big enough for full time. These come off of taxes as expenses.
I enjoy this style of content y’all put out. Also, you cannot overstate the power of excel spreadsheets. To the people that think it’s just a glorified calculator; think again 🤓.
I’m setting up kinda an odd ball situation, mobile only. I don’t have a shop, and the fact of the matter is I may need to get the hell out of wherever I’m staying fairly quickly, so I can settle down. I don’t plan on having any employees of any kind, just me and the truck
Good thing I Live in the most expensive part of the country ^^^ -semi sarcastic answer. It's a crap shoot. Shop rates 125-200$ an hour here. Chemical or sanitary>the price. Boston area
not a bad idea to add for the year end tax. as long as you have some deductions come tax time I think you'll find you don't really need 20 percent though. One thing that could be added to the discussion is a good accountant. I've been running a shop for 7 years and bottom line is charge as much as you can as often as you can.
The outside purchases required to do the job are usually marked up 20% - 25% to cover the true cost of money, time, and waste or research. At least that’s the way everywhere I’ve worked have done it. When you get large enough to have to hire a secretary to do all the vigors required to involve other businesses this mark up helps pay wages for that.
Was going to mention this. We mark up 30%. This covers the time taken by just dealing with ordering and receiving the materials. 10% profit on top is low also.
Thank you very much for this video, i am just getting started in this and your video helped a lot. As a buisness can you get material under the regular person price.
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This is the kind of stuff they need to be teaching in high schools! Excellent video, thank you so much for putting this together.
Honestly there is countless stuff they should be teaching in school that is frankly unacceptable to not be teaching. I sure wish I were taught how to do taxes for example
@@cameronbartlett856 Our education system is absolutely pathetic. We have the "woke" teachers who only care about virtue signaling, not preparing our youth for the real world. I mean, we now have members of the dept. of education saying math is racist, they're teaching revisionist history and concentrating more on gender identity than life skills. It's just unreal. That's why I was happy when my boy decided to learn a trade rather than go to a university. The education system is a cesspool of ignorance anymore.
This is basic math which you learned in school. It’s on you to think critically and apply it to your situation.
@@ourtube4266 what he is getting at is teaching you how to run a bussiness not just the math part. showing kids how to apply the math they learned is better than sayin hey look at this get it good TEST TIME. nothing more from the lesson
They are too busy preaching about bs instead of setting up kids for success in school
The answer is, “246.20$”.
“You came up with that price quickly. How’d you come up the number?”
“That’s what my boat due next week.”
😂😂
You forgot to add in the cost for a 6-pack to drink to relax after the boat check goes out!
Ooooooo
Oookoookoooo
i know guys like that. scumbaggery at it's finest
As far as the learning curve is concerned, taking photos of the jobs completed along with details of the bill of materials and consumables, time taken to do the job plus any lessons learned will make future quoting easier. A book for valued customers and suppliers and a list of blacklisted clients and suppliers to avoid in the future.
Great points.
Definitely a blacklist.
Excellent!!!
Excellent run down Jason. Takes all the guess work out of bidding work.
Thanks Brother. Appreciate the support.
Good video brother! A recurring mistake i had to correct was bidding too low, and losing. Your natural instinct 8s that you want to give somebody a good deal and be low in price. But dont ripp yourself off by undercharging. I do custom ornamental iron and metal art. I have found that high end clients would actually be inclined to think lower price means lower quality. Charge what you are worth!
Excellent perspective to keep in mind!
Profit is NOT a dirty word. People who dont want to pay enough for you to get paid for your work aren't the ones you want to work for anyway.
I remember pricing up a job once in the past for about £200 (cost), I later found that the sales guy sold it to the client for about £800, who then sold it on to their client for £1200. Ornamental / decorative work pricing can be bonkers sometimes.
A couple comments:
1) Don’t forget to add consumables and profit to the work you are doing in the field as well!! In these example, even if we time correct for the first example so that you complete widgets in the same amount of time (2/hr), if I am the guy hiring you, I’m gonna hire you to bring your stuff to my place, I’ll buy the material, and you do the work. After evening up the time and removing material, I would only be paying $17.58/widget if you come to my place, but $37.44/widget if you do it in your shop. Not trying to ball bust, just reminding that you need to remember consumables for your equipment and profit for the business if you are working at somebody else’s place too.
2) Good video and very sound advice. Remember most small businesses fail within the first few year of starting because guys don’t get this part right from the beginning. Getting your numbers right from the get go with ensure that you are making money and not just staying busy.
3) I agree that you should know what your local competition and market rates are. However, be careful just assuming that is what YOU need to charge. You may have more or less overhead. You may provide better service, etc. I work with contractors all the time and many of them fall for this trap. Know what YOUR business needs to make to keep the doors open. If you always just try to be the cheapest, will just be part of the “race to the bottom.” It is ok not to be the cheapest as long as you can show value to your customers that your competitors don’t. If your customers tell you that you are too high, ask them “Compared to what?” If they can’t or won’t have that conversation with you, they will likely never understand the value you bring...do you really want those customers anyway??
Again, great video! I wasn’t trying to pick you apart with the first point, just used it to illustrate how important this topic is for business owners, gotta know your numbers. As a person in business for yourself, this information is more important than knowing how to perform the work.
I mostly agree but you can charge too much, no matter how great you are. If the going rate for good service is $60 /hr and you want $90/hr, you will likely get few takers, even if you are the best, nicest, fastest, and cleanest person to hire. I have been self employed for 30 years.
Great Video! I cant count the number of times I've had to explain this to guys when they get pissed that I'm billing the customer 75+ an hour but only paying them 15-20. I do recommend figuring for like 30-35 hour weeks for coming up with your base line salary. IMO you will inevitable end up spending 5-10 hours a week doing things you can't bill anyone for.
I watch this channel to better my welding skills as a hobby.. But I also own and run a small bicycle repair shop and this video can go for any small business.. I realized a year ago that even tho I had the best prices around and a great attitude, I was severely cutting myself short. Raised my prices to be competitive and I still get business and can actually eat now lol
Put short & simple, if you don't know your TRUE NUMBER'S, your destined to FAILURE! Hello one and all, if your even on the fence about starting a new business watch this video, I don't care if your making widgets, or what-do-you-call-it's, this is the video for you. GREAT job Jason, the first comprehensive video I've ever seen of the subject (Machining / Machinist / Welding) of starting a new business. Thank you for sharing.
Thanks for the comment 👍
As new welder still in school ,obviously all the information to help me have a successful future in the business is helpfull .Not just this video but all the videos you and the guys post are always on my speedial for resourceful tips and tricks.BIG BIG THANKS to your team of welders.
Brilliant video that applies to other fields as well. As other commenters have said, this is the stuff that schools should be teaching. I study a field that has absolutely nothing to do with welding, economy, and yet I still feel like I learned useful things from this that will help me.
Great video.
One other thing I add into bids is I put in a percentage for depreciation on wear items like machines, trucks, electrical tools and so forth... Most the time anywhere from 2- 4%.
You are a awesome teacher, keep it up.
Good point!!!👏
Another great video. You should consider a mark up on materials and subcontracting items to be used for the job. This will protect your profit and covers the cost of the management of sourcing supply.
You are 100% correct. That’s why we add the 20% consumables and 10% profit last so it captures every aspect of the scope of work. I probably should have stressed that point a bit harder.
Yes. Always mark up materials!
I liked the way he explained everything fixing to start my little side gig just had trouble of over pricing my self
This is such a well thought out video that is so informative. I can't be grateful enough for such information considering how I am starting off welding. I now have a rough idea over how to go about this when I am done with my course.
Glad to help
A great video on how to run a business - and any business - it's all about costing and you have to get real! Well presented, man!
Thanks for watching
Thanks man appreciate the support.
I disagree. The market dictates what you charge, not your expenses.
Excellent breakdown. I know I don't pick the least expensive contractor when getting bids, I pick the guy that returned my phone calls promptly, showed up on time for the bid, and wasn't pushy or arrogant.
I’m in NE Florida and about to go out on my own, and this video helped me tremendously. This has been my biggest worry, bidding jobs.. Great video! Thank you
Nice work on the video, when I was pricing small jobs just starting out. I forgot about the consumables and time designing, going back and forth with samples, over the year thats a lot of money you've lost out on, always remember, your time and bits and bobs to do the job . ✌
Love the Sam The Cooking Guy tee. My favorite cooking channel. Period
Go check out our STCG grill build
For sure. Bought it when we visited him in February at Not Not Tacos. He’s a really cool dude.
Ill be sure t I check it out brother. Good stuff
👍👍
You really broke that down well. There are alot of people out there that do not look at the hidden costs and they wonder why they are losing money or barely breaking even. Great presentation!
Very nice breakdown. I rarely post but this makes sense. Thankfully I have a few friends with they're own business that helped me out but for people that don't this is a nice basic guide.
Thank you! This is an amazing business episode and actually could be so useful for any business out there!! Very detailed and easy to understand!
First rate in depth description and so clearly expressed tutorial that you have underlined a sound personal integrity to provide for sustainable growth and development. Thank you sir.
QUALITY content. I hope are getting that youtube money too because this kind of advice is money. Thank you for sharing your knowledge.
Never let anyone provide material unless YOU know they aren’t clueless. Shown up to many steel side jobs and dude has galvanized or aluminum/stainless hardware/hinges/etc.. They do that crap, you charge them for making you wait while they get the right stuff.
Thanks Jason another great video. You brought that down very well and what the operating costs are.
I am really glad you’re out there to help us to make the difference in our lives keep up the great videos I appreciate everything and anything you’ve done on this channel keep up the great work you guys are doing awesome.
Thanks man. I appreciate the feedback and glad I am able to help out.
Good useful info. Two things I would add are that you never want to be too far below the average cost because people will not think you are any good. So yes you don't want to undercut everyone but it can also directly hurt you getting work if you are the low bidder. And I always add 10% contingency to any project. You kind of have that in the second scenario with the "profit", but you don't want to be hitting your profit too much with contingency costs. There is always something. If you want to get some smiles you can refund any unused contingency when the job is done.
If you don't use the contingency, are you upfront enough to return it to the customer?
Excellent explanation. If you run your hypothetical numbers backwards, bid less material divided by hours you get a shop rate of about $62.
Great video, and excellent points! Never go by what everyone else is charging because there overhead cost and other cost might be different. There are many people that don’t take this into consideration when pricing jobs, that’s why they won’t be in business long, and why there are so many (Low-ballers) out there. Charge what you need to, and your craftsmanship will sales the goods!
Thanks men. That was really helpful on learning how to figure out my hourly rate. Im trying to start my own welding business. I cant wait to start my business soon. As of now I'm taking notes in starting off before I began my own business. Again thanks
I don’t weld nor do I own a business. But holy shit this was so informative THANK YOUUUU
Someone once asked me if I do cheap welding. I said no but I know someone who does, but he's in prison for causing a accident that killed a innocent family. 🇺🇸💪
Great video, when you mentioned shop rates in Florida it blew my mind. For a welding shop here you can expect a minimum of 120 to 150 dollars an hour for shop rate. Mind you thats Canadian.
One thing I factor is if they want me to run a MiG or TiG job. For TiG I usually up charge about 10% on average. Unless it’s a massive job I up my work hours due to it being way more difficult and time consuming in most cases. Stick I charge less unless it’s a large job because I hate stick welding lol
But for outside rough jobs I prefer it for minimal equipment and set up.
A welder and an automechanic make similar wages, so check the hourly charge-out rate in the local non-brand garages which looks like they are paying their taxes. Thats what you can charge. If it's a pure welding job base it on the weld in volume. If it is a structural job some thumb rules are: if the items are all over a ton (1000 kg) then 60 hours pr ton. If there are more than 12 items pr ton then it is 360 hours pr ton. Make a graph and draw a line between those two points. Most important is to have a network of other one man bands to use intermittently. Not only other welders, but specialist services like CNC, NDT, X-Ray, etc.
I wouldn't really say so. Mechanics make max $35 where I'm from. Welders at $10-20 on top of that before materials.
Figure 30 hours a week. That gives you 10 otherwise unpaid hours to do office work. Eventually you will spend 3 hours preparing that 20 widget bid and then not get the job.
Most small businesses fail because they don't stay on top of the boring office work.
Most small businesses have to have family involved. And they also have to make no money! One or two people can't efficiently run a business. Like you said, the insane amount of time spent on quoting a job is non productive and your losing money!! That time can't be billed to another job so when you never hear back from the customer on a job you've spent a day or two on guess what, the company just lost 16 hours of production and lost the wages that paid the estimator. That's why I like small jobs. There's way more profit to be made and less time wasted on estimates. I'm glad you brought that point up
Yes and you have time ate up by customers that want to talk your ear off, you have to be nice to because they are your customers. And let's not forget the salesman that drop in and say " I know your busy but if I could have 5 minutes of your time bla bla bla" and next thing you know 45 minutes has past then when you finally get back on those widget's , drop your hood and strike an arc, the phone rings, you have to answer ( could be that million dollar job that you dream about) but of course it's a recorded message telling you your cars extended warranty is about to expire. You end that call, look at the time and it's 4:45 and you've only got half of them widgets done that they are going to pick up first thing in the morning. You think, I'll call them and see if they could hold off till noon. then you remember that Jason with Acme is bringing his trailer first thing in the morning for a new hitch and jack, and you've put him off twice already . . . Shit! It's going to be a long night.
tubeonline629 Story. Of. My. Fawking. Life. You eventually get good at quoting work, when people ask real short questions, they’re usually just price shopping. Then you need to think on the fly, is it something that is actually profitable or is it something that will be $100 in material, take 10 hours and pay $300? If that’s the case, over bid it by 50-75% and send the tire kicker on down the road. To some, that seems like poor practice, but giving up your time to do charity work, is practicing to be poor. There’s a cost to doing business and there’s mouths in my house that need fed, unless it’s for our church, I’ve stopped doing charity work. People also don’t realize that when I’m constantly emailing my steel supplier for quotes on material, there comes a point where I become an annoyance to them, constantly requesting quotes then not actually processing 80% of them. Really don’t want to be that guy, because they don’t know if you’re price shopping with them or legitimately just not buying the material. Looking back, I really wish I tallied up the time I’ve spent working up estimates, that have literally gone no where.....actually no, I don’t even want to know! Just glad I figured out a way to weed out the tire kickers, greatly reduced my time that was once “wasted time”.
@@NTK_FabWorks great comment bud! Just started a mobile welding business with another guy and the hardest part hasnt been the work, its the goddamn quotes lol
one major thing you didn’t mention in regard to contract work for aerospace/defense is some of the regs placed on the defense contractor who subcontracts out work. as a former procurement specialist (aka buyer) for a major aerospace/defense contractor, we (I) regularly negotiated with one-owner/small businesses for subcontract work. my company was required to request a cost breakout on bids from subcontractors, i.e. overhead rates/amounts, wage rates, administrative AND MOST IMPORTANTLY, profit margins. Basically, the main customer, the government, was diving into the s/c’s cost & profit structure through the defence contractor. HOWEVER, the savvy s/c’s KNEW there were exclusions to these requirements and regularly invoked them so as to keep the gov’t and prime contractor out of their business structure. By NOT invoking these exclusions, the s/c’s open themselves up to FULL scrutiny AND more importantly, can create a nightmare for themselves when trying to negotiate and make a reasonable profit.
If you are contemplating pursuing ANY kind of business with the federal gov’t OR a prime contractor working a federal contract, it behooves you to research EVERYTHING about contracting or subcontracting with such entities.
I would also add in 10-15% extra just in case you forgot something and have to pay for it. I do computer work and have a set rate but I still add it " just in case" money because sometimes prices go up just before you order or you need more than you thought based on the actual site conditions. That 10-15% emergency money has saved me a few times when the client didn't do everything they were supposed to and I had to cover it to complete the job. Also make sure all the time you take to pick up materials is covered. If base cost is 35.15/hr I would just set a hourly rate of $55 or $60 because you won't always work the full 40 per week and that extra covers some down time. When I started back in the 90's, I set my rates 10/hr lower than the established businesses and haven't looked back. I started at 40/hr and now am 60/hr for in store work and 90/hr for onsite including Networking work. I am cheaper than many but only because I bought my location and have limited hours due to health problems. If I was 100% healthy, I could get $100-$120 /hr easily as that is the going rate for business work in my area.
A wise man once told me that if your getting all the jobs you bid, your not charging enough.
That’s very true!
Excellent quick course of business maths. Not only for welding, mind you :)
It's worth noting that it's 4.3 weeks per month. May seem minor, but it's a month's expenses and pay per year if you forget it!
Using Excel to build spreadsheet, use four decimal point on time values and material costs. Do rounding off numbers at last step (final bid price).
In my working days I took the other side of the coin. I did like you but I figured out the costs WITHOUT my pay. That way I would add on my pay to my costs. I would figure what the job labor is worth and what the person hiring me can afford and come up with a per hour total number. Yes sometimes we work for free but the bills have to be paid so my costs would be the lowest anyone would see per hour, unless of course there's women, booze, or rides involved to figure in the formula.
This was an excellent and very clear video. Thank you.
Great video Jason! Easy way to break down the costs! Thanks for the information!
Thanks for reaching out 🔥
Great break down mate keep up the good work thanks.
Awesome video, thanks for sharing. This will come in handy for sure 👊
Good video man. I finally am understanding a bit how to bid jobs
Thanks for the video. Opens your eyes. Starting a shop at the moment. My biggest problem is estimating time. Could you do a video on this? Thanks
Don't forget maintenance and upkeep, future replacement costs for the truck, welders, generator, and recurring training like maintaining your certs, and so on
Looking slimmer Jason nice work 👍
I charge by the inch, steel/stainless/and aluminum all different. fitting/ cutting and drilling to, when l break down all this little costs to the client there is nothing to complain. When someone needs just “one” inch of welding l apply the minimum fee.
It's basically an "educated judgement call" based upon what you need to do to stay in business and to collect a nice salary from your business. Today, I don't know of any shop that does not charge less than $70 US Dollars per hour to operate and that does not count any mobile services they may offer. It also depends on what kind of welding services you offer too. I took welding and machine shop in high school and back then, they told us that your Tig welders will make to most money because it's an "in demand" skill. I'm pretty sure that 27 years later (yeah I'm old, L.O.L.) this statement rings true.
In this video you are JUST COVERING your expenses! What about the reason you are in business.... PROFIT! Here in the New York area I charge for Stainless TIG welding and fabrication $150 Per hour! Costs to do business mis very high hear. I Design, Cut and fabricate for restaurants, and show rooms. They are quite happy to pay just to get someone to do the work.
Extremely well done. Thanks
How much you charge depends on your skill level, so youse guy are like a buck2.95 welders. 35yrs retired Boilermaker
we need more videos like this.
Can't forget what the more expensive tools cost, divided by how long you expect to be able to use them, so you can replace them as they wear out.
In my opinion you also need some amount for equipment and truck , upgrades ,wear and tear. This generally gets forgotten about
That's why you take a salary and put the rest back into the business👍
We use an average of 3 times the cost of materials for a job bid, then add design time and complexity to come up with a proper bid.
Sick! Awesome video and thank you for the info!
Great video.
I would also take the materials times 1.5+- depending on the region one lives in. $600.oo was your cost. Need to make money off the materials the customer didn't supply.
And don't forget to add taxes into the bid. Why eat into the profit?
I figured I'd watch this when I got another odd job... Days after you post* this one!
Tractor log grapple, but unsure of which type without too much info short of the fact I'm building a mounting assembly to attach it to the bucket or the 3 point lift. 🤔
Wish I had the darn specs or model number to prep before it comes in the shop! A 14,000 lbs tractor isn't exactly fun to keep in the shop or the garage.
I will have to pay someone to be the ballbreaker, I'm too nice to people!
I agree...Great Video...Very informative. Also...i caught the Ex-force quote" break it down Barney style...lol
"Trust the Awesomeness"
Man i did alot of handyman/ranch hand work and the amount of people who wanted me to use there tools and stuff so they could get a discount was wild. Early on i thought "oh nice, no wear on my stuff, that would be great!" Only to get there and realize their bladed tools are all old and rusty, shovels and rakes all have dried out handles with loose heads that would give slivers 100% of the time, power tools were ancient or barely worked, chainsaws dull and barely ran, etc. To the point i just started telling people no, i will bring my own well maintained tools. As if giving me trashed tools i had to sometimes fix for them was doing me a favor 🙄. Or the other thing that makes me walk away right away is hearing "well minimum wage is like 15 bucks(washington) and since im paying cash you wont have to pay taxes on it so really its above min wage....blah blah blah". Lady if you want to pay me for my physical ability to cut a limb off that tree then fine. Pay up i will be done in a second, but fair warning the tree will likely die. Thats the going rate for a neighbor kid who doesnt know what hes doing, you are paying me for my experience i learned over many years, experience that will not kill the tree. You are paying me for my professionalism of not leaving a bunch of trash and yard waste scattered around. You are paying me to not take forever to get the job done. You are paying me more because im not a tweeker you can hire for minimum wage that will provide cheap service, but will likely come rob you later that week because you basically paid him to case your home. If i wanted to work for minimum wage i would go get a job at mcdonalds doing a super easy low skill job in an temperature controlled building where i get breaks and a free meal once a shift.
Great video , you made that easy to understand
Awesome video, thanks for the advice
That is all good if you have already done the job because you know what you have used my biggest problem is when a customer comes in and asks you on the spot how much for a job. How long did it take you to learn “how long it would take to weld a job” as I find that very hard to work out for bidding on a job
It's a learning curve. As you do it more and more you'll be able to be a good judge of what it takes to do most jobs.
The hardest part of running a welding business, getting paid. If you are going to start a welding business you better be ready to fight like a dog in the street. I was on my own almost 20 years.
Fight like a dog. That bad huh
@@billionsandbillions Doing field work is also super cool. I worked in the mountains and deserts and in city's and tiny town's. Very rewarding work. Met alot of super cool people.
The piece of advice I would add right off the top is bid like you are paying hired work. Can you hire someone for $20/hr? Probably not. If a company gets it and sends an employee out, the are allowing more like 60-80/hr just for the employee in the equations above. At least bid it closer to that than farther. my.02
Now, the real debate... how much do i charge family 😂😂
Very useful! btw you've got viewers in germany^^
Thanks for watching 🇩🇪
and Polish one in Belgium :)
Love it. My family lineage is from Germany. Ever had Becker Beer?
@@jasonbecker3362 not really, though most beers are alright here.
Never underestimate the cost benefits. If you can’t make as much as a 9-5 you shouldn’t be in business. The problem in my area is people who charge half what I do because they don’t pay for necessary stuff like that.
I have a strict policy of never using customers tools/equipment.
Great informative video!🤘🏼
That was awesome. Thank you.
Thanks for the video on the first time I ever watched a video of yours and you know I basically kind of looked at it the same way but you did clarify futile see I wasn't really thinking about you much I appreciate that
Thank you sir for doing God's work
One good tactic to ensure you're pricing competitively is to simply get a quote from a competitor for the job that you're quoting for, just give them a fake name so they dont know that you're a competing business.
No, this is a sleezy way to do business
Why?
@@beachboardfan9544 just off the top of my head... fake name comes to mind.
Get a lawyer and an accountant. Consider a bookkeeper as a contract or part time basis until get big enough for full time. These come off of taxes as expenses.
For most of us tp retain a lawyer would be our monthly salary's.
Earned a sub from this one
Great content. Well done.
Awesome video! And, I like the trimmed beard.
I enjoy this style of content y’all put out. Also, you cannot overstate the power of excel spreadsheets. To the people that think it’s just a glorified calculator; think again 🤓.
Wow, awesome content. Thank you for posting. Liked and subscribed.
Love the Sam The Cooking Guy shirt!
i dont have any aspirations to be a welder, but i watched this.
great video and break down!
I’m setting up kinda an odd ball situation, mobile only. I don’t have a shop, and the fact of the matter is I may need to get the hell out of wherever I’m staying fairly quickly, so I can settle down. I don’t plan on having any employees of any kind, just me and the truck
Good thing I Live in the most expensive part of the country ^^^ -semi sarcastic answer. It's a crap shoot. Shop rates 125-200$ an hour here. Chemical or sanitary>the price. Boston area
Most biz want me to fill out a w9 so they can 1099 at the end of the year. Would you add another approx 20 percent for tax? Awsome vid thank you.
not a bad idea to add for the year end tax. as long as you have some deductions come tax time I think you'll find you don't really need 20 percent though. One thing that could be added to the discussion is a good accountant. I've been running a shop for 7 years and bottom line is charge as much as you can as often as you can.
That was good stuff right there.
Thanks for watching
i don't even weld, why am i here, but still interested
The outside purchases required to do the job are usually marked up 20% - 25% to cover the true cost of money, time, and waste or research. At least that’s the way everywhere I’ve worked have done it. When you get large enough to have to hire a secretary to do all the vigors required to involve other businesses this mark up helps pay wages for that.
Was going to mention this. We mark up 30%. This covers the time taken by just dealing with ordering and receiving the materials. 10% profit on top is low also.
Educational? For sure.
Thanks Brother 🤘🔥
Hey bro can you do a tutorial on how to stick weld red iron? I’m curious to learn! Thanks
That feel when my welding channel watches my cooking channel :D
Thank you very much for this video, i am just getting started in this and your video helped a lot.
As a buisness can you get material under the regular person price.
Damn good content! Certainly appreciate it
Thanks. We appreciate it.
Nice shirt🔥🔥 he has a great cooking channel!