Charging for design/bids?

hot_rod

Your cost of doing business needs to account for non productive time. Every customer pays a piece of that. Many contractors cover that cost in their billable hours. Hard to make money on parts markup for a thermocouple replacement

It may be wise to buy an hour or so of an attorneys time to add his thoughts and disclaimers, as Fred brought up good points.

Another help for getting jobs is referrals from past customers, ask everyone you work if they wouldn't mind writing up a referral.

A small picture book of past jobs, before and after pics, with the customers comments can be a powerful selling piece.

A shameless plug, In the heating help bookstore

Steve Minnich

Thanks Hot Rod. I use before and after pictures all the time for sellIng and have documented jobs with pics, piping schematics, and wiring schematics for almost 2 decades. I use to carry a Polaroid camera in my truck. Now of course, everyone has one.

I have both of Ellen's books and have read both. As I said initially, I try to cover the unbillable hours in overhead but we are seeing more and more commercial projects come our way and I'd like to have a more direct way of billing and collecting for the insane amount of bidding I do. I've wanted to "partner" with Ellen for some time now but just haven't been proactive enough to set up an appointment.

Fred

There are so many business models, marketing strategies, growth strategies, etc. to draw from that it is almost impossible to to suggest how to structure your business without understanding exactly what your long term goals might be.
Many successful businesses have an expectation that their Professional/technical services groups attempt to achieve somewhere around 80% billable hours. In reality, it's probably more like 70%. The remaining 20% to 30% is lost to admin duties, paperwork, non-billable follow-ups, vacations, sick time, educational days, Personal days, etc. Given that, what typically happens is the total of salaries is factored by 120% to 130% + overhead (insurance, real estate/work space/ tools, equipment depreciation, company paid transportation, utilities, benefits, any other people related expenses, including the cost of any "Sales person/team") + profit margins divided by total available hours to arrive at an hourly bill rate. Some overhead items like utilities/fixed building costs may be at pass-through rates rather than adding margins to them (Depending on what the market will bear). Equipment/parts inventories are calculated separately and the overhead typically includes inventory expense(stocking/pulling inventory, floor space, insurance, depreciation, cost of money/opportunity costs, shipping/transportation costs, utilities, etc) + profit mark-up. Clearly the lower the inventory levels coupled with a "Just-In-Time" delivery model (to the installation site, if possible) increases parts margins and reduces space needs as well as makes more cash available for the business.
Right now we are talking only about how best to recover un-billable "Installation/Execution" costs. If they are covered in that 20% to 30% uplift added above(which includes sales expenses), then you are already recovering those costs plus margins and overhead. The one thing you don't want to do is continue to "Stack" false or redundant costs into your model or you will find you are out of sync with the market and your competition. If they are not covered by that 20% to 30% factor, it may make more sense to add an additional dollar or so to the total Billing rate to cover that as an overhead expense and still keep it low enough that a customer doesn't feel gouged. In any case, even for a "Packaged" quote, the calculated/educated estimated number of hours to do that installation should be based on your billable hourly rate plus you fully loaded equipment costs and margins.
Of course, you can build the model you are currently working on and sell those "Implementation/Execution" Services as a separate"value Add" offering by your company, if you so desire.

Paul48

Keeping it all in perspective.....We work to live. We don't live to work. Any time we are forced away from family and friends, and prevented from pursuing our passions, has great value. That said......"Momma always needs new shoes".

EBEBRATT-Ed

Have to be careful pulling permits for other. A Coworker did that so the guy could change a furnace on a weekend. The made a plenum out of cardboard. It collapsed and fell onto the hx. Burned the house down

Mad Dog_2

Keep it reasonable and ALWAYS apply, at least some of it, toward the work if you get the job. As some other's have said here, be flexible, but NEVER give away ALL your knowledge without a reward. Mad Dog