labor hours

[jtinker]

Heyo guys im developing a small applicaton that calculates sign prices and I seem to have hit a brick. I need to know if there is any standard formula that you guys use to calculate the amount of hours worked for a sign when you price it. It will be freeware for desktop browser and smartphones and is in the infancy stages at the moment. But I hope to be completed with it in a month or so.

 

[jtinker]

Let me know if this sounds accurate from a signage perspective, I have worked up an equasion that gives me some accurate results. There will be an input in the sign overhead profile (low, standard, high) that allows users to input production speed. Its based off of a value that i had to standardize. Simply put how long would it take your shop to produce a 48" x 96" sign in hours. That then becomes the standard shop production speed. Let me know your thoughts.


labor=(shop_rate * speed) / (sign_sf / 144);

labor = hourly shop rate * production speed / entered sign square footage broken down to feet

The image below traces out 86.72 in material costs, 900 in labor costs for a 48" x 96", laminated decal mounted on 9mm pvc board.

 

[James Burke]

Labor costs always begin with your annual operating budget. Divide your anticipated yearly costs by your total working hours for the year, and that's your hourly rate. This is the bare minimum. Don't forget to include include taxes, insurance and a ton of other "non-visible" overhead expenses that consume your hard earned dollars.

These numbers will differ for every shop owner. Obviously, the presence of competition will affect your final numbers and that's where you have to be creative in controlling those costs.

The absence of debt is a tremendous competitive advantage that isn't spoken of much, and that factor alone can go a long way in helping you stay competitive with your rates.


JB

 

[CentralSigns]

You also need to consider what the product is selling for in your area, next city whatever. You want to maximise your profit you don't leave money on the table. Scoop up that extra even if you don't think you need to charge it. Always happens something goes wrong down the rode and that bit of extra helps even it out.

Otherwise I agree with Burke make sure you charge what you need to to cover all those costs. Most times starting out people charge too little and realise that after a bit when they seem to be working like a dog but not having a bone to eat after its all said and done.

 

[jtinker]

I will have an additional tool that allows users to exit xml files to insert all of that information. Finally figured out my equasion, I had a standard value ratio 1:32, one hour is equal to 32 square feet of production. Had to take the static values ($50/h, 32 square feet & production speed) then cross them against the user entered amounts i.e. sign square footage. Mostly me liking myself talk but if anyone else is doing the same thing this might be useful in the future.



productionSpeed= shop_rate / (32 * speed);
labor= sign_sf * productionSpeed;