How far do you travel for a job?

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“I got a call this week from a customer all the way across my state. We’re talking over 300 miles. He says he can’t find anyone locally and really wants me to do the work for him as he’s heard I do great work. My question is this, do I charge my usual rate for the work I do locally, or should I add it something for getting there and back home?”

Many customers like to stroke your ego to get you to do work for them for various reasons. Sometimes it’s to get better pricing by flattering you with complements. Other times is because there isn’t some locally to do the work. And sometimes it’s because their pay history is so poor that no one around them will do work for them anymore.

The issue today, though is the travel issue. You are going to burn a day going out and a day coming home. That’s two days of revenue you can’t generate locally. A cost you need to add back in. Once you are there, you will most likely need a hotel to sleep in for the night(s) you are there. Additionally, you will need to spend money on gas to and from and will most likely eat out as packing food and cooking it is a pain. You also have other vehicle expenses as you have miles, tires, wear and tear, etc. What we are looking at is a couple of items called mobilization and demobilization. These items are the costs of getting you there and home including revenue you are not earning by staying home. If your typical day of work at home is generating you $2,500 per day in net revenue after expenses, that is a number you should be adding into for your mobilization costs. If you take employees with you, all their revenue generation as well as expenses should be added in. Years ago I used to add $100,000 to a bid for mobilization and demobilization for my six man crew to travel a day away from home base to perform a CIPP lining job. Obviously, we didn’t get a lot of 200’ lining jobs nor did we want them, but my point here is you need to think about these costs.

Then there’s the unforeseen costs. Supplies and logistics of getting them to you. Freight and chasing parts in unfamiliar regions cause added expense. Extra days over what you anticipated means more hotel and meal expenses.

If you don’t adjust for those added expenses, regardless of what they are, you will not make the margins you’d make for the same work locally at home. My real-world experience is that without adding all of the mobilization costs plus my normal margin for profit, I’d end up on the losing end of jobs that took me farther and farther from home base. My advice is that if you do travel, be sure to add mobilization and demobilization to your job to cover the costs. If you follow that simple advice you will maintain your profitability and while you may not get as many “far away” jobs as you did before, the ones you do get will let you make a profit instead of spending weeks working your tail off for breaking even or losing money. If you’d like help calculating costs, call us at 888-354-6464 or write info@pipeliningsupply.com.

Pipe Lining Supply Events

Interested in a DEMO Day??
Pipe Lining Supply will be at the 3rd Annual DEMO DAY
FREE Lunch and Drinks for All!!  Watch LIVE Outside Demonstrations of the Latest Technology, Machines, & Tools of Our Trade!
Demo Day Flyer
Where: 6390 Columbus St. Riverside, CA 92504
When: Friday 9 a.m. to 5 p.m. Nov. 30th, 2018
The WWETT Show is speeding toward us quickly. If you are attending, be sure to register. John Heisler will be presenting this year the AIPPR coating process as the standard set by IAPMO in the UPC. Booth 6722



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