# Lets talk numbers



## lshomesolutions (Jul 19, 2008)

Would like some feedback for my company. I have been in business for 3 years. Last year we did 426k and this year we ended up at 482k in sales. I currently have a guy that helps with me bids (@17$ per hour) and also watches 2 jobsites while I do bigger bids and watch that job site. We also have an office manager (@13$per hour works 25 hours per week). I have 6-7 guys working for me. This last Quarter we have averaged 53k per month in sells (since I brought on the office manager and brought my main guy up to do bids.

Here are my numbers as a summary. Cost of goods Sold is at 69.7%, expenses at 16.9%, and net profit at 13.4%. This leaves my gpm at about 30.3% for the year. This last quarter our focus has been gpm and we averaged 39% gpm.

I have never had to go looking for work really. This year I am looking to really turn up the heat on our volume. Especially since I have and office manager and this guy helping me with bids and production. I am looking to project 700k in sales

do you all see any problems with these numbers? just trying to see what everyone else is doing. I realize pricing numbers are frowned upon but this is a different question. I know my overhead and I know what my mark up should be. Just would like any feedback in regards to my company. Its time to start making some dang money!!


Other Info
1. for jobs under 2000$ i try to hit 60-70% gpm
2. for jobs $2000-30,000 i try to hit 44% gpm
3. for jobs 30k and above its 32-40%


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## PrestigeR&D (Jan 6, 2010)

How are you getting your work.....:blink:



B,


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## Easy Gibson (Dec 3, 2010)

May... may I have some?


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## PrestigeR&D (Jan 6, 2010)

Do you work for yourself. ...:blink:

Are there employees.....:blink:


Are you a sub.......:blink:

What do you do.......:blink: are you specialized in one area- specifically ....:blink:


And again,.....how are you getting your work......:blink:


B,


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## lshomesolutions (Jul 19, 2008)

Sorry. Remodeling company. Kitchens, baths, room additions, and handy man stuff. We normally get our work from people who find us on the internet and real estate agents who refer us. I own the company and don't do any of the labor. I only help out when needed


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## Easy Gibson (Dec 3, 2010)

Good for you, man.


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## Jaws (Dec 20, 2010)

That sounds pretty close to what Remodeling magazine, NARI or Linda Case would suggest.

For us, the jump in sales is not a big deal. The number of projects is. Until June this year, I didn't think we would do a million in sales, which last year I thought was kind of our new break even. But sell a couple of six figure remodels and the numbers go up.

My point is, I would do a lot better financially doing 600k in kitchens and baths than if I did over a million in room additions, so the gross sales isn't important to me anymore. Just margins.

With our staff, we could do 2 + million in larger remodels, new customs, additions ect...

I don't know that we could do a million in baths and kitchens. We aren't set up for running 15 jobs at once, so we would have to make some changes.


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## huggytree (Nov 3, 2013)

about the only thing that stands out with me is how many employees you have and your sales are only $500,000

im at $525,000 this year all by myself...most remodelers I know have a couple of employees and are in the millions.. the small 1-2 man operations are $300,000-$500,000.....1 kitchen could be $60,000+...so $10 kitchens a year is all you'd have to do to make $500,000.....

with my plumbing business id expect $2,000,000+ with that many employees....I know some high end service shops that expect $500,000 per plumber a year


I think 13% profit is low also

on remodels I like to be at 30-35%, new homes 10-15%


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## donerightwyo (Oct 10, 2011)

FWIW, I sell that much remodel work and I bang nails 40 hrs a week. 

All I know for sure is that 13% of $700,000 is a lot more than 13% of $482,00.:thumbup:


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## Jaws (Dec 20, 2010)

huggytree said:


> about the only thing that stands out with me is how many employees you have and your sales are only $500,000
> 
> im at $525,000 this year all by myself...most remodelers I know have a couple of employees and are in the millions.. the small 1-2 man operations are $300,000-$500,000.....1 kitchen could be $60,000+...so $10 kitchens a year is all you'd have to do to make $500,000.....
> 
> ...


I'm no expert, but net 13%, true net after salaries, is outstanding for a re modeler or builder.


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## huggytree (Nov 3, 2013)

donerightwyo said:


> FWIW, I sell that much remodel work and I bang nails 40 hrs a week.
> 
> All I know for sure is that 13% of $700,000 is a lot more than 13% of $482,00.:thumbup:


I would rather have 1/2 the staff, do $300,000 worth of work @ 30% profit and make $30,000 more a year

make more/work less

ive always gone after the specialty market where the money is good...you need to be fussy/anal and not make mistakes, but the payoff is good.....I always say if I don't make atleast 10% ill work for someone [email protected]% your very close to my work for someone else theory

rather than growing I would try to raise my prices and try to hold onto $500,000 for next year.....if you can go from 13% to 30% profit that would be huge


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## Jaws (Dec 20, 2010)

huggytree said:


> I would rather have 1/2 the staff, do $300,000 worth of work @ 30% profit and make $30,000 more a year
> 
> make more/work less
> 
> ...


Plumbing ain't GCing ....... if you try and do everything your self your sales drop dramatically. Most days I don't have time to get my tools out, but do when possible. I don't want my salary being covered completely by overhead, i'd rather pay for it banging nails and see the margin go up.


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## huggytree (Nov 3, 2013)

Jaws said:


> Plumbing ain't GCing ....... if you try and do everything your self your sales drop dramatically. Most days I don't have time to get my tools out, but do when possible. I don't want my salary being covered completely by overhead, i'd rather pay for it banging nails and see the margin go up.


I know its not apples to apples....not everyone can be an over paid plumber

I know of some prime contractors who charge 40% profit...they are very high end and expect perfection (and they get it)

it would be nice to get paid to just organize the jobs and not swing a hammer...id love it as I get older....


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## Jaws (Dec 20, 2010)

huggytree said:


> I know its not apples to apples....not everyone can be an over paid plumber
> 
> I know of some prime contractors who charge 40% profit...they are very high end and expect perfection (and they get it)
> 
> it would be nice to get paid to just organize the jobs and not swing a hammer...id love it as I get older....


40% gpm (gross profit margin)

13% net would be, at the end of the year, you do 1.5 in sales and you net 195k, after salary. That's what he is talking about. 


If you know people netting 40% as a GC, that is unbelievable.


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## BamBamm5144 (Jul 12, 2008)

Isn't that an extremely high amount for costs of goods sold? Basically that's a fancy way for saying material costs, correct?

What am I missing.


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## PrestigeR&D (Jan 6, 2010)

Extrapolate :_______________________________________________.



Your getting clients through a middle man,.......per say....

Along with tire kickers of the insane super highway......


You have no relationship other than the one you have that is spoon feeding you,,,,,,,,,

Your bypassed.....you become a tool......your "utilized like the mop I have"


Dependency .......


Low numbers......selling scared......

Time/profit.........


You want better income....you have to apply some personal input.....selling...and provide a VG service, professional......etc..etc...

Client A feeds more client A referrals.....your client is the one that is "skimming off the top" feeds you nothing but possibilities and limited growth.......you work hard for that kind of relationship....



The choice is ultimately up to you....,

The definition of insanity is doing the same thing and expecting different results......

JMPOV,


B,


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## Jaws (Dec 20, 2010)

BamBamm5144 said:


> Isn't that an extremely high amount for costs of goods sold? Basically that's a fancy way for saying material costs, correct?
> 
> What am I missing.


COGS is materials and labor costs.


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## Jaws (Dec 20, 2010)

Jaws said:


> COGS is materials and labor costs.


That's actually incomplete, it's labor, materials and all resources needed to complete the project.


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## BamBamm5144 (Jul 12, 2008)

Jaws said:


> That's actually incomplete, it's labor, materials and all resources needed to complete the project.


Yeah but he has COG at nearly 70% and Expenses at nearly 17%.

That's the problem, just too many different ways guys think of things when it comes to financing.


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## Texas Wax (Jan 16, 2012)

huggytree said:


> I know of some prime contractors who charge 40% profit...they are very high end and expect perfection (and they get it)


That would be markup on labor and material costs?... Out of that comes cost of project management, overhead, profit, owners equity and such. Or are they pocketing 40 cents on every dollar 

40% is on the high the higher end. But 23-35% markup is typically middle of the road.


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