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It also depends on how much work the business has to if they will bid high or low for a job, and if that they think that they think that they can charge more for a job and still get it. sorry that I can't explain it better but it just depends on how much profit and how big the company is to what the price is.
I'll have a goQuote:
Originally Posted by artme
Tree Lopper A
Self employed, as is their off-sider.
In terms of "wages" is paid what is left over at the end of the week.
Makes no provision in their job costing for non work days, paid holidays, inability to work due to illness or superannuation.
Likewise makes no provision for replacing their tools of trade -- chain saws, ladders, truck, etc. -- doesn't charge travel time.
Will dispose of the tree by dumping what they can at the local council tip and burning the rest. Expects that the customer will keep the bulk of the tree for firewood.
Job is costed something like this...
It'll take a whole day.
$200 to pay the off-sider
$150 for Tip fees
$50 for fuel and consumables
$400 retained by tree lopper as "profit"
Total $800.
Tree Lopper B
a proper company structure
employees work for wages and are paid for public holidays, annual leave, sick leave, superannuation, plus any other entitlements. Collectively these are known as employee overheads
each employee's costs also include an amount to cover the company expenses -- insurance, owner's salary, etc -- sometimes called general overhead
company makes provision for replacing / maintaining the tools of the business, including the truck.
company owner and his wife (and some of the kids) are each paid a salary by the business plus a dividend (= retained profit) at the end of the year.
all of the tree will be chipped on site
Job is costed something like this ...
$2000 -- day rate for four employees, including their employee overheads
$800 -- day rate for the company's truck, towed chipper, saws, etc -- covers the use, maintenance and depreciation of these items
$500 -- general overhead for four employees
$150 -- travel costs
$150 -- Tip fees
Total $3600
At the end of the day, it comes down to how many people will be on site, how much (and how) they are paid, and whether you are dealing with a company or sole trader.