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Old 12-11-2018, 02:58 AM   #21
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$600,000/2080 hrs = $288.46/hr /.5 (billable efficiency) = $576.92/hr (labor component of flat rate task)

I know for a fact, this is not unheard of.
The best year I ever did as an employee was just shy of $500k, and I did it about 2 years running. Then I just burnt out. While I could sell that now, even more, I don't think I could come close to producing it.

I think the industry average is $250k per electrician, but I think that with the rising cost of everything, that average is beginning to kinda suck.

Average should be around $350k per electrician I think. There is too much overhead to be less.

Now with Flyboys shop, a guy that can sell 500k, 800k, etc... That is sales, not necessarily production. The top dog sells and gets compensated for it. The guys that can't or don't sell, they produce and get compensated accordingly, but not as much as the guy that sells.

I read/heard something recently from an accountant that deals with the construction industry. He specifically mentioned EC's and the $250k per electrician comment. He noted that a lone EC can produce $400k, but with an employee it might be $500k. Now while it is $100k more, it is down to the $250k average.
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Old 12-11-2018, 08:08 AM   #22
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I read/heard something recently from an accountant that deals with the construction industry. He specifically mentioned EC's and the $250k per electrician comment. He noted that a lone EC can produce $400k, but with an employee it might be $500k. Now while it is $100k more, it is down to the $250k average.
Can you explain that last part?
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Old 12-11-2018, 08:41 AM   #23
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A member of this forum who was always a good poster and never came off as a liar worked for a large EC alone in his own van as a resi service electrician. He said that he billed $600K per year.

It's a large franchise type EC who had their sh1t together, the men were well trained on selling, Nexstar, etc..

You think it's possible?
Rewire?
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Old 12-11-2018, 08:26 PM   #24
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Rewire?
never came off as a liar?
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Old 12-11-2018, 08:50 PM   #25
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never came off as a liar?
lol, I didn't even respond because Rewire is the opposite of everything that I said
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Old 12-11-2018, 10:04 PM   #26
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Can you explain that last part?
You ever notice that when you stick two guys on a job that takes 16 man hours, it will take them 16 man hours to get it done. Now if an owner or other good employee does that 16 man hour job by themselves, it may get done in in 12 hours or 14 hours.

Technically the job was done faster, but took more man hours.

There is a similar thing that seems to happen when the business grows and you add employees. While you can crank out more work, the average over the number of employees can shrink.

The owner that can produce $400k by himself hires an employee. Some of his focus has to shift away from the sales & production side to training and managing too. So he can no get more work done, because he has two people, but now he does other things business related that he didn't do before, so that can take time away from sales.

He can't just focus on sales, because the single person he hired can't do the production for the number of jobs he can sell, so he has to do the work too. Eventually he hires another, and the cycle continues.

I've read about this a few times and have noticed it in a number of businesses. I am sure they have some Harvard Business School studies on it.

Funny thing is I have been hearing that number for about 20 years. Gotta say, electricians really need to start charging more if the numbers have held steady for 20 years, while every other expense associated with a business and labor has increased.
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Old 02-12-2019, 01:06 PM   #27
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No, I will be at 16-17 emplyees by next year. with our expansion. with projected 4-4.2M in sales.

right now we are at 9people at 2M in sales

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For an EC in 2018 doing 2 million dollars with 17 employees you have twice the number of employees you should have. That's $117,647 in revenue per employee. Too low!

You should be doing at least 3.5 with a plan to get to 4 million with the 17 employees. That's $235,294 in revenue per employee.

You're too top heavy. I'd say you're lucky if you're breaking even, but I doubt it.
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Old 02-13-2019, 07:42 AM   #28
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No, I will be at 16-17 emplyees by next year. with our expansion. with projected 4-4.2M in sales.

right now we are at 9people at 2M in sales
We keep 3 in the field, I'm in the office. It's very rare that I put on any tools but, can manage to be on a jobsite 2days a week if necessary for supervision. My duties are prospecting, sales, procurement, AP, AR, design, and other pimping tasks.
We have been doing 1MM in gross sales. The best jobs for us are hit and run, high margin, no-bid, design build government jobs. In with that are 6 or 8 commercial building ATS swaps we do in one day for a flat 5k.

Long duration jobs, 6 to 12 months, put volume on our books but the margins are so bad, in the 10-20%, I hate everyone of them. This month we will close a deal on two 200k plus deals like that.
Both are very nichey projects and I think I will have to pick up 3 more guys to make them happen at the same time. Both are 9month jobs for national size GCs. One of them I will start out 5k in the hole just due to attorney contract review fees, bond purchase, and builders risk insurance.

My ultimate goal would be to find a about three 35 year old motivated electricians, each with a couple of kids, a wife and a mortgage. Put them each into brand new well stocked vans and turn them lose on residential and light commercial service work.
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Old 02-19-2019, 05:14 PM   #29
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We have a crazy amount in the office in my opinion, but it works well. We put an incredible focus on customer satisfaction.

- 12 electricians in the field
- 1 office manager in office, she makes sure everything in the office runs smooth. Supplies, filing, etc.
- 1 bookkeeper in office. AR and AP primarily.
- 1 service manager in office. Manages the 12 field guy's needs.
- 2 estimators in office. Estimates and pseudo-project manages their jobs from incoming calls. One estimator is my VP, he manages work-flow processes and keeps the guys in line / process quality.
- 2 warehouse/parts runner/etc in office. Orders and receives parts, manages stock, manages vehicle fleet maintenance, runs parts to electricians to keep them on billable time, and anything else.
- And me
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Old 02-21-2019, 01:10 AM   #30
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It's possible, but improbable he sold and did the 600k worth of work on his own. I have HVAC techs, plumbers and electricians that sell that much and more, but aren't doing all the work. I have one HVAC tech that will sell 1mil this year, but that includes a big portion of equipment that get's installed by our HVAC installation department.

Same with two of our electricians. Better then 600k a year each electrician, but they aren't doing all the work by themselves.
Agreed, that's a lot of work for one guy to sell AND install, likely some of his sales are getting passed on to other installers.
Techs that sell more than they can install will help grow your business, its pretty simple.
Flyboy, what sales system do you use for your company?
I have done some training but am always looking to learn?
Also, how did you expand to offer plumbing and HVAC.
From the other side of the fence they both look more profitable than electrical?
Any advice fro someone trying to expand beyond electrical?
(PS getting another ticket is not an option, but i realize I will have to gain a basic competency of whatever other trade I expand into).
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Old 02-21-2019, 01:27 AM   #31
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Can you explain that last part?
Efficiency curve: The more people you add to your company, the less revenue/employee is produced.
Though at a certain point it does level off.
A small one man shop has the highest efficiency and revenue/ employee but has the lowest potential for growth.
The reverse is also true for large companies: they can turn big sales numbers, but they have to invest into management and marketing (among other things) to do it.
Plus, as organizations grow it becomes harder to keep everyone operating at peak performance.
There will inevitably be some underperforming or "dead weight" employees that slide under the radar.
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Old 02-21-2019, 08:03 AM   #32
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This thread is relevant to my interests. I'm going to be running the show in 5 years or so, and want to have steady growth so I don't have to be on the tools anymore.

Man, with Flyboy's numbers, putting a guy or 2 in stocked service trucks is sounding really good. I hate doing that kind of work, but having a construction division, industrial service division, and a resi/light commercial service division could be lucrative. The only thing we don't do now is residential service, but with the right people that could be a real money maker.
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Old 02-21-2019, 09:05 AM   #33
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....

( I went to edit a post and this rat bastard board ate my post )
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Last edited by splatz; 02-21-2019 at 09:17 AM.
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