Effective Handyman Invoice Example for Personnel

Handyman invoice example for Personnel

what's up all my folks on YouTube land Daryl also known as The Finisher hey we're going to talk a little money today not the topic I normally talk about but I have had a lot of questions about how I go about charging and there's so many factors in it that I'm actually we're gonna have class today all right welcome to school man this is the finishers Academy you're going to learn a little bit today about just really crude ways on how to maybe figure out your pricing in the beginning now like once you get going and you actually get some numbers built up in your catalog and you got P L's and you know you didn't file taxes a few times you're starting to see how much things actually cost you you get more numbers going down the road customer acquisition costs and all all sorts of things um then you can you can do all that a little later that's not what I'm doing today this is this is this is 101. matter of fact yeah this this is a prerequisite course to the basic accounting course okay so this is a really these are some really crude ways to figure out maybe what you can charge in the beginning and based on your number that you put in you know what you need to make at least to break even these calculations should help you get there but there are a lot of other factors that go into pricing so this is just a base level thing so anybody out there that says well that's not the way I do it and you know well I do it this way okay that's that's wonderful you can do it your way man I there's a million ways to do it so let's let's Crush some numbers all right first we're going to start with just a really quick method it's it's this is the disclaimer okay all these methods are just quick ways to figure things out over time after work they're intangibles there are other things that go into making prices this is just basic numbers right this is a couple different ways to to give you a an estimate calculation uh you know a lot of guys always are wondering what the charge is different for every area but it's in the different depending on your personal situation all right so am I saying this is the one and only way to do this absolutely not you do what you want to do I'm just telling you different ways that I looked at it when I first started to to help get me to understanding pricing a little bit more so I just wasn't going in just throwing numbers out and then being catastrophically wrong okay so at least I had a basis this is just to give you a basis that that'll help you work with maybe what you want to make per year or you know dealing with how much how many bills you have what are your bills like what's the point of charging if you don't have enough at the end of the day to pay your bills it's crazy right all right so since we got that out the way let's proceed with class ladies and gentlemen first things first we want to start with how many days are we planning on working in a year because I'm I'm guessing that you're not planning on working 365 days okay so the idea of having to make 300 a day or something like that to get to that's out the window unless you plan on never having a day off and I did that you all you know Salute Your paper boy back in the day man because paperboys never got days off it's crazy working these kids to death all right so all right 365 days in a year how many weekends do we have I'm just gonna assume you don't want to work weekends but we don't want to calculate it like you are working weekends okay so we're gonna take out weekends so there's 52 weekends in a year that's 104 days just multiply 52 times 2 to count Saturday and Sunday we have 104. to weekends [Music] subtract that you left with 260 one days now are you planning on being off any other time yes you are all right what if you get sick you know you get a kid you get you have a cold or you got to get put your vehicle in the shop or uh just something or you just want to take a vacation you know what I mean you're allowed to take a vacation or just days that you had to work scheduled and some something got canceled you don't want to make it like the schedule is going to be packed every day for this whole 261 days so you give yourself some leeway I like to usually use four to five weeks all right couple days of a Miss couple days here and there I had my you know daughter I'ma travel with somebody to an event somebody I you know travel uh you know take them to college all sorts of things sausage usually try to say five weeks right so what's five weeks that's 25 days minus 25 that's going to leave you a 236 working [Music] days [Music] this is very important this number right here is extremely important because like I said unless you plan on working 365 days a year we're gonna base everything off of this number us working this amount of days per year okay all right now let's not saying you can't work weekends just saying hey maybe you have to take a day off and then work a weekend maybe you work the weekend as a bonus you got a call and it was a job you just couldn't pass up so you work the weekend hey that's all bonus money or you could subtract that out of your working days and give yourself two extra days somewhere else I don't know do what you want with it but this is what I'ma base these numbers on today you might want six weeks off you might want eight weeks I don't care you do what you want with it but this is this is what we're working with today let me fill this in minus 25 days days off okay so see this take a picture 236 days that's what we're working with today I'm gonna put that number in the corner for reference [Music] so we're always going to reference that that's our that's how many days work per year now we're gonna do a basic one right basic basic is like how much you want to make per year we're just going to start it out because it's the the six figure number is the one that gets thrown out there so much hundred thousand everybody wants to say they make six figures right okay let's do it let's go with one hundred thousand well that's it's a very simple uh calculation right you want to make a hundred thousand dollars a year and I'm saying you're making a hundred thousand this is total this is gross this is how much money did your business bring in for that year 100 000. you want to divide that by 236. [Music] you end up with 400 23 dollars and 73 cents [Music] or just rounded up man 424 dollars so that means for you to make a hundred thousand dollars a year and only working 236 days a year you have to make 424 dollars per day per one of these working days now believe it or not 424 dollars is not much to make in the trades you can make this number very easily but but you do we're focusing right now on this hundred thousand everything has to come out of that hundred thousand right that means all the taxes all your tools all your overhead your gas like everything has to come out of this hundred thousand so you're not putting 100 424 in your pocket right but to make that much per day it's it's it's really not difficult to do that so we're at 424 dollars a day right per day it's how you're gonna make a hundred thousand now divide that by per hour now you can work up you can work eight hours a day right but what I say is we're not basing this on what they do in the corporate world we're basing this on what we do in our world all right if you want to look at it like eight hours a day you can I don't base anything off eight hours a day and maybe it's just personally because eight hours a day is what you're conditioned to have because I based off a six now that doesn't mean I always work six there's plenty of days that I work 12 hours there is no set schedule I go into a day with a plan and I execute my plan so remember we had 24. 424 a day to make a hundred thousand dollars a year right that's gross um but now we have to say if you want to break it down further a lot of people keep talking about hours we got you know billable hours and whatever if you want to look at what this is just the basic face real basic thing today maybe you want to base everything off eight hour days I don't one reason is it is just me being a little petty right because I was under that system for a long time the eight hour days and all that blah blah blah I was brainwashed too I didn't realize that the day is what you make of it I could I could make five I could plan on working five hours a day you know I mean and it'll save me time for my Rex Juan doe lessons later I mean whatever you might do is what you do [Music] I usually base things off of six hours a day because even if I'm saying eight hours I might want to account for the drive time if I gotta stop at the store whatever whatever if I gotta write up estimates that morning whatever I gotta do I'm basing things off of six six hours right so and to do that you just divide by six foreign [Music] per day we end up with I think it's uh 70 is it 71 dollars we end up with approximately 70 71 dollars per hour [Music] that's not bad like I said to make a hundred thousand dollars a year gross all you gotta charge is 71 an hour work six hours a day for 236 days a year that'll get you two hundred thousand now that's a low bar because you know we're like I said that hundred thousand that we were talking about that's really a uh it so since everything falls underneath it we gotta change it up just a little bit right so I'm gonna do one other method that'll give you a little more insight it'll actually I said it'll give you a little more insight to to what's possible but you'll have to take it from there so this next method we're gonna figure out is gonna include our overheads right in taxes and things like that and like I said this is still very basic there's a whole lot of numbers that you can get you start getting P L's and all that and you start getting all these little intricate numbers that'll break down and uh you know cost per customer acquisition all kinds of things you can figure out but you don't you're not gonna have enough data when you start out to know these things I might say my overhead let's they say a nice round number of four thousand dollars a month you know for of all the all the money that I have to pay out I'll give a round number of four thousand dollars a month [Music] four thousand dollars a month in overhead all right what I include an overhead I include everything everything I'm talking about I don't get your mortgage or your rent all your groceries everything everything that you I don't care if it's personal if it's business every bill that you have to pay is you're gonna be part of this overhead all right like I told you your Rex quando lessons man include that in your overhead four thousand this is just for now you can break it all down a little more later um because you can tweak things when you break them down a little more later so you know you could say oh man if I if I tweet this question yes if I just was able to save ten dollars in gas I can change it to this and you can really tweak the numbers and get crazy with it we're not we're not going to do that here this is real base base level you figure out getting started how much I could charge somebody for some of these things so this is how much I and um another thing with this overhead yeah like I said this this four this is four thousand dollars but you gotta think about it like this overhead varies depending on who you are this is why it's so hard when people just say hey what should I charge I don't know I don't know your situation I don't know where you live I don't know your situation I don't know anything so I can tell you I might be able to tell you what I charge but then again I don't really even tell the customers that so like break down why what I charge them so I'll just be putting my prices out there by breaking them down but what I'm saying is it varies upon your situation so if you're an 18 19 you live with your parents and your only overhead is your overhead totals a thousand dollars a month because it's just basically your truck or you know I mean uh a couple things here and there but you don't have much overhead that makes a significant difference you might be able to charge the 75 and make just as much as me because I have six people in my family six seven people that that I got to help and do things for so it changes your situation really affects these numbers that's why you know you have to figure out your own overhead what that means to you now on top of that I might say uh you know I want to make 500 a week is owner's pay you always have to have owners pay you might not in the beginning pay yourself or whatever I mean who knows but you want to eventually be paying yourself something so say I say 500 per week owners pay [Music] right then I want profit right you do want profit otherwise if you plan if some people plan on growing and adding more trucks and things of that nature how you gonna do that you get you need profit if you don't have profit what are you doing what are you doing you're not in business you're you're just doing favors out here you might as well if you don't have any profit you might as well have a job because you can cut that overhead way down with all your business expenses and all that and you won't have the owners pay but whatever and then you won't have to have all the sessions there's no point having all these headaches doing all this extra if you for no profit come on man you need profit so uh you know you might say hey say you want to make a thousand dollars a week profit I said this is really crude man really crude numbers this is per week this is per month this is per week we're gonna take that into account all right so I'm gonna go back to the total year I would take all this and we're gonna go back to the and we're gonna uh calculate it out to the whole year so your overhead for the year forty eight thousand dollars this owner's pay we said every week we're gonna calculate it for the entire 52 weeks I know we're only going to work this we're only going to work 236 days but just because you take vacation doesn't mean you don't want to get paid right that's that's how you have to look at it I mean it's the same way that we calculated if you had a job you have vacation days or whatever your your salary is all calculated within your salary so owner's pay we're gonna take that out for the entire 52 weeks in a year Japanese owners pay us 26 000. before you say that's low keep in mind just keep in mind you're already everything's already paid with your overhead okay so before you like uh you know I mean I pay myself two thousand dollars a week congratulations man you're the greatest person of all time that's wonderful but we're just doing this as a very crude thing and now we go to profit of course we multiply that per year that's 52 000. now add all this together we got 100 26 000 per year right but this is where a lot of people forget to do where are the taxes man where the taxes well take a picture I'm about to erase this right so we're gonna take the we're going to start working on this 126 000. so we said after we have all those numbers we have a hundred and 26 000. that's with the overhead that's what what we want to make we decided we wanted a thousand dollars a week we decided we wanted 500 an owner's pack okay that gives us to 126 000 a year but you have to take into account taxes taxes my friend you can overestimate taxes if you want you can underestimate them you're not going to know in the beginning so hey maybe take a little more but you're gonna have a lot of write-offs and tools and materials and all these things so I'm just going to throw a number out for tax that we're going to use for this just for this situation you can switch it to whatever you want to try to use it for okay so we're gonna go with 20 all right so we're paying taxes are 20 now how do we figure this thing out now we don't say taxes are 25 20 of this number this is what we want this is the number that we want to have in our pocket after the taxes are paid so we have to figure out what number did we take 20 of and get this right how do you do that I'm about to take you back to algebra but hey you know whether you know it or not you know I was a student in applied math and theoretical physics okay I mean that was my major when I was in college I didn't finish but I took a whole lot of math class in physics classes but I didn't finish not because I couldn't it's a whole other story we're getting to that one day but the way you want to look at it is simple calculus I mean no some simple algebra X times a percentage equals 126. 1000. right we said 20 percent or no we said we had 20 taxes what does that mean which also means you look at it this way this number 80 because this is 20 is 100 right away 20 of this number or you can look at it like this number is 80 of this number that's the way I like to do it I just go with eighty percent remember the taxes are 20. that means that this number is 80 of this number so how do we get that we just divide this number by 80 percent 0.80 right makes it a very simple division number so then X equals 100 and 57. thousand dollars and five hundred so this is what you would have to make in order to cover your overhead at four thousand dollars and we said that profit a thousand dollars a week and then have five hundred dollars in owner's pay now you could tweak those numbers however you want that's the beauty of these of doing these calculations so this video is going to be here I told you my page is gonna be like a reference guide to certain things so you can you can watch this video a million times now but for real though it's that's what it's here for it's here for a reference so you can look at that calculation again but that's what we get to so 157 000 includes taxes that means after we pay a hundred and after we pay 20 tax will have 126 000 left over and that's the real money you have in your pocket right now now this Windows 236 comes in because we do what we did before except now we know we have a number we know a couple of our numbers behind it we know if we have 157 then our overhead is paid we got a thousand dollars per week in profit and and on top of that 500 a month or per week in owner's pay I mean you know so you'll be able to stack up and you'll be able to get you know if you want to build if you if you're planning on building a business you'll be able to grow and and actually get places okay that's how that's how you'll be able to buy a truck you know uh that's how you'll be able to pay things down me I'm not about that credit I'm about paying cash that's how you'll be able to have enough money in your account and then then that's a whole nother thing is like once you get the money your account how you disperse it what you do with your profits and all that that's a whole nother whole other thing but for right now 157 once again like we did before we divide that by 236 because that's how many days we're going to be working per year I'm sorry 157 5. you know I used to Hate That I Used to hate when the teacher would use their finger to wipe off the white board or the chalkboard I just did it it's crazy that equals 600 67 dollars and [Music] 37 cents or or it's essentially 668. so that means to actually take home that 126 thousand dollars you're gonna have to make 157.5 that's assuming 20 taxes and then you're gonna have to make 668 per day on average that's all that's that's on average so let's crunch the math again six 68 what are we saying per hour we're going to divide it by six again that's 112 per hour so that's what that's telling you in order to make that money that amount is coming up in order to make to 157 000 per year in six hours a day working 236 days a year you gotta average 668 hours or 112 dollars an hour if you're working six hour days I mean when you look at that that's not crazy that's not that's nothing that's over the top to make 112 an hour you might be wondering when you first start are people going to pay you that I don't know this is this is why except I don't charge by the hour and let's have a discussion about that right I said take a picture man you know what I mean go back through it look at the different numbers maybe write it down plug you plug your numbers in that work for you and see what kind of numbers you come up with what kind of hour uh per hour numbers you have now I do not charge per hour I think charging by the hour is trash okay because even though 112 an hour seems cool and uh you know gross in 157 uh sounds good that's still a ceiling I don't like any ceilings okay I don't like putting caps on what I can make so we're gonna go let's let's talk about a little bit of the intangible all right so we just finished all those calculations right now there are a couple other things you need to just keep in mind you go over to was it the contractor fight uh they say hey figure out what you need to do the job and then add 50 onto that you can do that there's a lot of different ways to do this okay what you don't want to do is just figure out how much you have to pay in bills and then barely be on top of that and then feel bad for the customers and and whatever else this is what's gonna happen I'm going to be in business and you're struggling and you're going through all this nobody cares right you go out of business because your prices are so low your prices are so low that you just can't keep up and now you go out of business and what's the customer is going to do when you go out of business yeah let's just go and find somebody else right and then they're gonna say ah man he was he was good man but I I don't know I wonder what happened to him ah well let me uh dial the phone see if I can find somebody else that's that's it that's it their feelings don't matter when it comes to your business right we're not gonna base anything off of feelings um but you also have to be able to look at intangibles so I could have looked at that price and said it's a hundred and twelve dollars that I need to make 157 all right so I need to make 600 and what I say 668 a day okay but there are times that I can make it you know what if I can make a thousand in a day I might not make that every what if I can make that but if I can make 1500 depending on what I'm doing right that that puts me way past that that's what I'm saying that the stuff that you're working on is just a basis but I might say I might uh have a day where I don't know I'm looking at a project the customer has I'm thinking it's going to take me three days but I look at the complexity of it and I look at the drive and I look at all these things and I say okay well I know that I need to make at least to get to my goal I need to make at least 668 a day but this job is going to require this extra so I'm going to charge 850 a day for this job and it's just because it's worth it because yeah that's base level but it's not a base level project so yeah because of this this that and the third I'm gonna charge an extra 200 a day that's your choice they could take her to leave it right but that's that's that's your choice what you have to figure out but you don't have to box yourself in and say well on paper it says I have to charge 112 an hour so I'm gonna just charge 112 dollars you can do that if you want but I like to look at the hourly charge as just a reference right that that 112 if if that was going to be my crude number that I was looking at that I need to charge per hour it's just a basic it's just basic Ally well there it is and there you have it I told you before this here is like a reference page so you know you can you know you can get to a certain spot and like pause it and look at the screen and like write everything off the screen and maybe try to figure out your own numbers and and see how they work for you now play around with it it is there's no exact thing that's the whole point there's no exact numbers everybody's numbers will be the same all the time for everything play with the numbers figure things out for yourself all right like comment subscribe holla at me in the comments man like you know let me know what you think or hey let me know if you got a different method let us know that too hey you might have something that's a little just even faster let's go man handyman 2.0 let's build this community all right so till next time stay safe be blessed and remember if the trades don't work nothing else done [Music] foreign