"Shop" Rates - What to Charge per hr?

[the_white_shadow]

I put shop in "__ " because i dont consider myself a fab shop. I recently started doing work on other people's rigs in the sop in my spare time after work and on the weekends. Current rig in the shop is a ram 2500 that i did a custom radius arm swap on. Hes a buddy so we havnt decided on how much i should charge him, but i have around 25hrs in this thing.

I now have another guy wanting me to do an axle swap on his Samurai. I have the axles but need to pull them and rebuild them (yota axles).

How much should I charge him? Should it be an hourly rate? Or flat rate for things like this? Ive seen other fab shop rates in the $70-90 per hour. I wasnt thinking anything near that, but wanted others opinions. I would be buying all the parts and adding it to their bill.

This also brings up whether or not I should get an LLC to cover my ass. This isnt just simple bolt on stuff so i would like to be covered in case of an emergency.

Thoughts?

--Alex

 

[jccarter1]

It can be a slippery slope I do work for friends only and the ones that I do big work for cage, 4-link, ect... I make them help me do it that way they share the liability as far as what to charge it depends but I am do stuff way to cheap a lot of times I just wouldn't feel right charging what some shop rates are but this is why I do it as a hobby and not for a living

 

[the_white_shadow]

Thats the way i feel as well. Im not looking to do this for a living. Ones a good friend i have known my entire life and the other is a neighbor of my brother who is more of an acquaintance. I dont want to rip them off by any means.

 

[money_pit_yj]

Tell them to pay you what they think its worth. Just be ready for their reply either way. That is why I cant go into business for myself catering cause I hate charging people.

 

[smbroady82]

I have a close friend that does the majority of the major work on my rig, Mo (Rokcrler). We have had this discussion 100x if we have had it once. I try to help him out as much as possible, even if it is simple stuff like disassembly, reassembly, cleaning stuff up and so on. He always takes care of me and I wouldn't hesitate going to him for anything. I always tell him: "man, make sure what you are charging me is enough to cover your time". There are also a lot of other things that people don't take into consideration like power and consumables, that stuff can add up quick.

Like Clint said, you have to be careful. I know several of the guys on here that fabricate for others like Mo, Jason Duckett, Patrick Murrah and so on. Maybe they will chime in. I think without seeing what you are going to be working on beforehand, it could be very difficult to quote out work.

 

[blacksheep10]

When it was side work, even with my shop and facilities, I was at like $40/hr for hobby work. Especially tube work where there can be some staring t it. Most of what I do now is half again to double that. I also have tools that make it go faster though (5x10 table, pressbrake, lift, lots of welders/cutting machines/iron worker etc) Thinking back to the hobby times, it always felt like I was overcharging, but I never got very far ahead, so my compass was off. What's your time worth? kids? wife? opportunity cost?

 

[the_white_shadow]

Thanks for the replies guys.

As for what im working on. Currently its a 99 ram 2500 24v 4x4 that i did a radius arm swap on with 39s. Wasnt too difficult. Pushed the front axle 3" forward by using a Ruffstuff radius arm kit and some Thuren lift springs and shocks. Had to get creative with the new adjustable trac bar relocation. Its almost done, but its nothing too fancy. I should charge him extra for making me work on it while the undercarriage was covered in mud/dirt. That **** was messy. lol

What i started with


Where it sits now almost done







The new "client" has a samurai on 31s that has the generic lift springs/shackles and wants to swap in some toyota axles for the additional width and strength. Moving some perches and welding on some shock tabs. Nothing outrageous. Ill have to rebuild the front axle which is something i have done numerous times. Not too sure on what steering upgrades he will need. I dont have any pics of it though. Going to check it out up close tonight to see what i am dealing with.

 

[the_white_shadow]

When it was side work, even with my shop and facilities, I was at like $40/hr for hobby work. Especially tube work where there can be some staring t it. Most of what I do now is half again to double that. I also have tools that make it go faster though (5x10 table, pressbrake, lift, lots of welders/cutting machines/iron worker etc) Thinking back to the hobby times, it always felt like I was overcharging, but I never got very far ahead, so my compass was off. What's your time worth? kids? wife? opportunity cost?

No kids. No wife. But working other peoples stuff is taking away of me finishing my new rig by my self imposed deadline next month.

 

[smbroady82]

I would charge him extra for bringing you a filthy truck to work on. That's b.s. . A lot of places do that (charge extra).

I love your toyota btw!

 

[stuftmunky2k]

I bill $60 a hour in shop plus consumable. But im a single man operation. When people ask for a quote i generaly give them material and consumable price then rough estimate on hours. But i always give them a not to exceed price. They always dont understand why the number is so high so i explain that this is what it (should) cost but this is what it will max out. Always got to cover your ass. Could be a friend or family member always get paid before product leaves the shop. My boss actually still owes me money from his razor cage. My dumbass said well i see you everyday go ahead n take it pay me next week. 1.5 months later nothing so its on the verge of getting repod. Always make sure material and consumables are paid up front so all your out if stuff goes south is your time. For the llc and insurance have to watch once u tell them its offroad or something of that nature premiums go straight up. And if you insure the home shop you work out of will more than likely mess with your homeowners insurance and zoning. That aspect of it gets little tricky.

 

[ridered3]

Can't really help on setting a "shop rate", but having various levels of rates would be good in terms of *Basic time rate, *Thinking about ti rate, *Staring at it rate, and of course a *Fab time rate, etc and so on. Could be tough to keep track of time wise, but just a thought to help you realize you aren't overcharging.

But here are my 2 cents for what its worth in relation to CYA (Covering Your Ass) and the LLC. If the project requires fabrication (not a full bolt on lift kit from a reputable company etc), and/or will be street driven, get an LLC to protect yourself. While most of the folks you have worked for/with are friends, all it takes is one accident/incident in which a part your fabbed fails. Friend or not, it opens you to a whole new world of messy lawyers and legal hoops to jump through.

Just my thinking as an analytical guy and not a fabrication guy.

 

[Markrobinson]

Can't really help on setting a "shop rate", but having various levels of rates would be good in terms of *Basic time rate, *Thinking about ti rate, *Staring at it rate, and of course a *Fab time rate, etc and so on. Could be tough to keep track of time wise, but just a thought to help you realize you aren't overcharging.

But here are my 2 cents for what its worth in relation to CYA (Covering Your Ass) and the LLC. If the project requires fabrication (not a full bolt on lift kit from a reputable company etc), and/or will be street driven, get an LLC to protect yourself. While most of the folks you have worked for/with are friends, all it takes is one accident/incident in which a part your fabbed fails. Friend or not, it opens you to a whole new world of messy lawyers and legal hoops to jump through.

Just my thinking as an analytical guy and not a fabrication guy.

My experience is similar but a different field (residential remodeling).

For years I worked for a contractor who paid me ~$18/hr and billed me out at $60. On the weekends I charged $25-30/hr under the table, not paying taxes, no business license, etc. Three years ago I started my business and now charge $65/hr and have 3-4 months of work lined up and I never hand out a business card.

I don't know your day job and how far you want to take your fabrication work, but if it were me I'd consider doing what Patrick said above: get the LLC, but further, form a legitimate business. When I look back, I wish I had done it years sooner. I was leaving money on the table and delivering the same dedications and quality I do now.

 

[ridered3]

My experience is similar but a different field (residential remodeling).

For years I worked for a contractor who paid me ~$18/hr and billed me out at $60. On the weekends I charged $25-30/hr under the table, not paying taxes, no business license, etc. Three years ago I started my business and now charge $65/hr and have 3-4 months of work lined up and I never hand out a business card.

I don't know your day job and how far you want to take your fabrication work, but if it were me I'd consider doing what Patrick said above: get the LLC, but further, form a legitimate business. When I look back, I wish I had done it years sooner. I was leaving money on the table and delivering the same dedications and quality I do now.

Good point on the forming of a legitimate business in conjunction with the LLC, if that is a route you wanted to go. Both the business and LLC help in terms of a CYA scenerio. As a legit business, you can also get better tax write offs that if you claim any Income/Expenses on your Schedule C.

 

[the_white_shadow]

Great thoughts guys. Even if i work on customers vehicles once every two months, would starting a legit business/LLC be beneficial? Right now its just a hobby i do for myself and just recently started to work on other people's rigs. I wouldn't mind doing other projects in the future as a side gig. Doubt ill trade in my main job, as it pays the bills. Down the the line though, you never know. I started this thread because the new customer keeps asking how much i would charge him for the swap. Ill just give him an hourly rate and tell him i wont go over a certain amount. Thinking around $35-40/hr and not exceeding $800. Thats around 20-23 hrs for the axle rebuilds and to swap them in. How much does one charge for consumables? I was thinking 10% of the total bill to cover welding supplies, flap disks, shop electric, etc.

 

[TBItoy]

"Shop" Rates - What to Charge per hr?

I'd charge enough to not have to split out consumables. Unless you have a decent parts washer you'll blow some $ on cleaner to get some ol grungy toyotas buildable.
For "buddy work" which is all I really ever did, we'd agree on a dollar amount and I'd make it happen for that. Had some $4-500 electric bills doing sas and welding out cages and 4links

Usually ended up working for beer.

Sent from my iPhone using Tapatalk

 

[P]

Ive battled this subject for years... turns out I am a whore, but I habe fun , pay for my parts or tooling and I have some ( debatable ) skill but not skill like many guys I admire and respect so it really comes down to fun and friends for me these days.

 

[the_white_shadow]

Re: "Shop" Rates - What to Charge per hr?

I'd charge enough to not have to split out consumables. Unless you have a decent parts washer you'll blow some $ on cleaner to get some ol grungy toyotas buildable.


Sent from my iPhone using Tapatalk

Nope on the parts washer. Not looking forward to cleaning this one either. Typical weeping original seals and rusted to ****.

 

[TBItoy]

Re: "Shop" Rates - What to Charge per hr?

Nope on the parts washer. Not looking forward to cleaning this one either. Typical weeping original seals and rusted to ****.

It's easy to make a "friend" not so friendly when you start charging for the actual time it takes to clean up that nasty mess.


Sent from my iPhone using Tapatalk

 

[grcthird]

Your price will go up when you start an LLC and insure it to protect yourself. Looking back at all the side work I used to do and what could have happened, kinda makes me cringe. Pricing your work will get easier the more you do it but even then you still get your ass handed to you every once in a while. For instance, I'm about 18+ hours into installing a rebuilt engine in a cj2a willis that was brought to me with parts in boxes taken off by another shop that went out of business. Yes it is easy to work on and I had to figure out what went where and all, but can I see charging the guy 1500 in labor fair? Not really. That's the hard part is finding a rate that you can live with, not gouging the customer, and still make some money to make it worth your time. Personally I think custom work should always be higher than replacing/rebuilding parts labor rates.

 

[blacksheep10]

Consumables are part of Shop rate. Figure out about what your average usage is and factor it in. Trying to keep that **** separate is a nightmare. The only time you keep it separate is when they pay in beer but want to make sure your electric bill, gas wire and grinding disks are covered.