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Rental Rate Blue Book / Cost Recovery
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Following these guidelines will help make this the best resource for heavy equipment on the net. Thanks for joining us and I hope you enjoy your stay!! Welcome to HeavyEquipmentForums. Hey everyone im new here to this forum I just wanted to know if some of you from various locations could give me a example of what you all charge per hour for different pieces of equipment usage please and tell me where youre located. I am in Richmond, Va and these are the prices I use below but I mostly just bid the whole job price rather than an hourly rate.
Joined: Sep 12, Messages: 68 Location: england uk. DirtmanSep 18, I believe the price here should be the same I don't have one so im not sure But from everything I have seen I think you are correct. Joined: May 21, Messages: 1, Location: south dakota. Actually for this area the prices are correct and I actually stay very busy I don't do alot of resi work mostly all commercial. I was thinking of opening up another sister branch of my business in Charlotte,N.
C prices and under bid till I can get my foot in the door there. I just wanted to see how much it varied by region. The cost of things here in Richmond,Va is high JPCobraSep 19, DirtmanSep 19, I won't try to get those prices down there I have a cat c with 4 n 1. I asked this question on another thread but didn't really get an answer.Click here to subscribe.
A while ago, I put together several video tutorials on how to look for work, how to keep clients, how to improve your marketing, and how to close sales. These have been very popular segments in my seminars and I want to remind you about this resource. This training is focused on the idea that the best way to get a job is to never ask anyone for work. If you are new to the industry, or looking to expand your current client base, invest a few dollars and 90 minutes of your time and watch this training.
It can make all the difference when looking for work. Click here to learn more or purchase these tutorials. Justin Rhodes writes:. I want to get your opinion on something. I am starting my video company and I do good work for Great prices. By good I mean very much better than beginner level, when most of my clients would settle for something that was decent. I want to get into a lot of weddings etc. What would be a good price to charge for filming and editing these events. The second part to this question, this woman wants me to film an event that would take place over the course of a weekend.
Dates July 27th to August 2nd. Okay, not only will I be shooting for a lot of those days… but I will be editing etc. And I am from Dallas! Larry replies: Justin, these are great questions, because it shows you want to make a living, not simply do all your work for free. If all you offer is a low price, you have nothing to fall back on when someone else undercuts you.
So, take a step back and figure out what it takes to do this as a business. We start by working this backwards. Figure out how much money you want to earn in a year. Hope for more and plan for the worst. Assume you will work a normal work week when you are employed — 40 hours per week. This is NOT true in real-life, but it helps with the budgeting process.
Increasingly, the industry is moving to either weekly or flat fees. A weekly fee is how much you charge on a weekly basis to edit something. For a flat fee, calculate how many hours you expect to work on the project then multiply that by your hourly rate. There is nothing wrong with asking for more. These numbers just illustrate the minimum amount you should charge. Next, you need to calculate the fee for the use of your computer gear. No one would hire a lighting director and expect them to provide all the lights, grip equipment, crew, and electricity for free.
Neither should they expect you to provide your gear for free. It costs you money to buy, maintain, and replace it. None of those are free. Also, by having two separate fees, you have an incentive for a producer to provide you equipment, because they can save that part of your fee.
To start this calculation, assume that you need to replace all your computer and video equipment every year. Divide the total amount you need to replace your gear by the number of working hours we used in this example 1, Finally, if travel is involved, tell your client that you pass through all your travel expenses. These do not get marked up.The rates in this guide are intended as guidelines paralleling amounts an equipment owner should charge during rental or contractual periods to recover equipment-related costs on a single-shift 8-hour basis.
These rates are derived from cost formulas and data developed by EquipmentWatch and from analytic methods used in the construction industry. Generally, these methods consider purchase price, depreciation, maintenance and overhaul costs, indirect equipment costs, and average annual use hours.
Specific market conditions, such as local supply and demand, are not considered in these calculations. These rates are not a tabulation of rates being charged nationally. They do not reflect rates charged by rental companies except by coincidence. Recognizing that costs may vary considerably from state to state, a Regional Rate Adjustment Table is provided as Appendix I.
Memorial Scholarship! Don't forget to register for today's webinar! We have another webinar this Friday with occupational safety and health attorney, Adele Abrams. Join us Friday, April 17 at p. Register now for our upcoming webinar on Wednesday! Skip to content Menu. Need to prove it to a customer? Download the Guide.
Heavy Equipment Pricing Per hour
MCAA is currently accepting applications for its flagship executive education program, the Advanced Leadership Institute. Designed specifically for mechanical contracting executives, the ALI is focused on developing the talents and business networks of leaders in the industry.
The application process is competitive, so early submission is recommended. Contribute Now! Twitter feed video. Reply on Twitter Retweet on Twitter 3 Like on Twitter 1 Twitter Reply on Twitter Retweet on Twitter 2 Like on Twitter 2 Twitter Reply on Twitter Retweet on Twitter Like on Twitter Twitter Reply on Twitter Retweet on Twitter 1 Like on Twitter 3 Twitter Heavy equipment rentals include bulldozers, backhoes, large diesel-powered dump trucks, front-end loaders and other large construction and commercial equipment.
When operating a heavy equipment rental business, rates are determined based on the profit the owner desires over a two- to four-year period.
To determine what rates will provide that profit, expenses in maintaining the equipment must be considered, while also taking into account the depreciation of the equipment over time. The amount of value the equipment depreciates over time must be calculated into the rate planning as an expense also called a "liability".
Visit the local county government tax office in which each piece of heavy equipment is registered and inquire about obtaining or purchasing a listing showing three years of depreciation on the same make and model you will be renting. Since literally thousands of different county governments are all around the United States and provincial governments in Canadadepreciation rates will be highly dependent upon how the local government determines valuation on such machinery.
Visit several heavy equipment auctions where equipment similar to your own is being sold after three to five years of use and record the final sale prices. Between Step 1 and this step, you have two value numbers for each type of machine: a government-based depreciation schedule and an auction sale price after three to five years of use. For the remainder of this article, a five-year maximum rental life will be assumed for example purposes. Add together the government-based depreciation and the final auction price after five years for each machine and then divide the sum of those two numbers by two.Landscape Estimating Software - Costing + Pricing Equipment
Calculate rates by the hour of use, so that the machine pays for itself over five years, and also pays for the depreciation average using the previous figures. In this way, the liability of depreciation is turned into income. When the machine is sold at the end of five years, the final sale price will also be income, because the depreciation liability will have been negated. Determine total cost of employees and business operations expenses and then include this final figure into the costs of doing business.
These expenses shouldn't be planned as "pass on to customer" expenses if using the depreciation-negation strategy outlined in this guide, as doing so would prevent your rental prices from being competitive. Instead, use the receipts for purchases and maintenance as tax deductions at the end of each year to lower the amount of taxes which must be paid. Set a preliminary rental price based on having the machine pay for it's new price over five years plus the depreciation loss. This percentage must be changed based on how many employees and what the agreed salary per year is.
This is where the rental prices must be balanced to be competitive with what other heavy equipment rental firms are renting their units for. In a way, this will dictate what you will have to live on in this type of business.
A fair percentage for cost-of-living, however, should be roughly 20 percent per year of the total five-year figure made previously. Set the hourly rental rate to bring in the final amount over five years.
A good estimate is to keep the machine rented out hours per week, or hours per month, which permits weekends to be excluded. Over five years, this will be about 48, hours. The estimates here are very conservative and somewhat rigid.
A heavy equipment rental business may have a larger number of employees or a smaller number of employees. Further, maintenance costs will vary in different areas and these differences will need to be accounted for in a way that the business still generates the desired level of income.
It would serve your business interest to set your prices close while competitive to what others are renting similar machines for in the given area. This article and the final hourly rental cost breakdown assumes a conservative business owner who earns a living by renting out more than one machine at a time rather than just one.
However, this example breakdown should scale to your desires, regardless of how many machines in the fleet. Know your costs of doing business and figure all things great and small into your final chosen hourly rates. Add in the expenses of machine insurance, office supplies and computers, fuel expenses, workman's compensation insurance for employee staxes according to state and federal tax codes for your desired income, etc. Every business is unique and all things must be taken into account.
Consider hiring a certified accountant to help with making your business profitable. Annual profit is, at its most basic, the operator's desired profit added on top of the total costs, liabilities and taxes. He attended Western Nebraska Community College. Share It. About the Author. Photo Credits.Discussion in ' Trucks ' started by WawreckerJul 15, Log in or Sign up.
Heavy Equipment Forums. Thank you for visiting HeavyEquipmentForums. Our objective is to provide industry professionals a place to gather to exchange questions, answers and ideas. We welcome you to register using the "Register" icon at the top of the page. We'd appreciate any help you can offer in spreading the word of our new site.
The more members that join, the bigger resource for all to enjoy. Thank you! Thank you for joining Heavy Equipment Forums! If you are new to forums we communicate with "Threads", please search our threads to see if your topic may have already been answered and if not then click "Post New Thread" in the appropriate forum.
This will allow all of our members to see your question and give you the best chance to be answered. After you've made a number of posts you will graduate to Full Member status where you'll see a few more privileges. Following these guidelines will help make this the best resource for heavy equipment on the net.
Thanks for joining us and I hope you enjoy your stay!! Welcome to HeavyEquipmentForums. How do you guys come up with your hourly rate you charge out and hour and are you sure it covers your cost? WawreckerJul 15, Well, I can't say much about trucks, but maybe my experience with equipment can help you out.
I break down everything that costs me money while operating the machine, the operator, amount of fuel consumed per hour, etc. I got technical enough to break down component costs per hour, say the average lifespan in hours of a bucket and it's replacement cost.
From there, I could find out how much it's costing me per hour to run that bucket. For me, I don't have substantial records to look back on and guesstiamate how long that bucket will last, but it's a start. Talk to some folks and see what they're charging. CascadeScaperJul 15, Mine is figured a little different.
I put a lifespan on everything of 3 years unless I know it will have to be replaced before then. Brake it down to a 20 hour work week 6 months out of the year.
Hourly Rate Calculation
Figure in maintance, oil, lube, tires, and fuel. This has worked for me for 22 years and I am happy with it. Dwan HallJul 15, This guide was created to help you effectively use the Internal Charge Rate Calculator in order to achieve accurate and competitive internal charge rates. There are two ways to view the Internal Charge Rate Calculator: a detailed view or a list view.
The detailed view allows you to better understand the impact each factor has on your final internal charge rates. As you scroll down the page you can update critical factors, general cost factors, ownership cost factors, and operating cost factors. The list view is for experienced users of the Internal Charge Rate Calculator. Simply click on the drop down menu of the configuration component that you wish to adjust and select the configuration that most closely matches your asset. After you finish making all of your configuration adjustments, click on the orange confirmation box at far right of the page.
Individual cost factors e. Original Price, Annual Use Hours, Annual Overhead can be updated manually by simply clicking in the field of the cost factor that you would like to adjust and typing in an updated value. Any dependent cost factors that also changes as a result will be listed in the box below each cost factor. If you would like to print your internal charge rates for submission or for your own records, you can click the print button at the top right corner of the page.
If you would like to download your internal charge rates, you can click the download button at the top right corner of the page. It is specifically designed to assist the user in determining the required hourly ownership and operating allowances necessary to maintain solvency. For each equipment listing, current industry average data is presented as a default with the opportunity for the user to incorporate site-specific actual costs into the rate calculation. The analytic methods used to derive costs are accepted throughout the construction industry as a means to obtain guidelines for charge rate estimates.
Contact is maintained with manufacturers, industry organizations, and individual contractors to ensure that these guidelines conform to current industry practice. This information is designed to provide accurate and authoritative information in regard to the subject matter covered. While all efforts have been made to assure total accuracy, the variable nature of the information and informational sources precludes any warranties of specific accuracy in any specific instance.
Both fixed and variable hourly costs are presented. Fixed costs e. Variable costs e. It is recommended that the costs listed in this guide be adjusted for unusual or specific job conditions, multiple shift usage, economic conditions that are particular to a specific region, and equipment standby periods.
Heavy equipment cost data was obtained through extensively surveying contractors and then translating the collected cost data as ratios of manufacturer suggested retail prices MSRPs of heavy equipment models. These factors, when applied to current list prices, will suggest amounts necessary to recover the total investment in equipment. The factors can be applied equally to all makes and models within an equipment class and size category, provided that the equipment is in average condition and working in average job conditions.
This product does not attempt to measure or describe the engineering or performance characteristics of specific models made by specific manufacturers. Whereas a manufacturer may rightly claim the advantages of its products, the information herein should not be used to substantiate such claims.
The Internal Charge Rate Calculator lists hourly ownership and operating costs for construction equipment fixed and variable costs are presented in this product. The fixed costs--depreciation and equipment-related overhead--begin when equipment is purchased and continue regardless of equipment use. The variable costs--overhaul, field repair, fuel, lube, tires, and ground engaging components--occur during machine use and are therefore accrued during actual operating hours.
The factors used to develop these costs are based on average equipment use and job conditions. These factors are reviewed continuously by the EquipmentWatch analyst team and are adjusted according to contractors' experience reported in surveys, recent market trends and cost information reported by equipment manufacturers. Profit, project overhead, and general company overhead costs such as office facilities and supplies are not included.The Rental Rate Blue Book is a comprehensive guide to cost recovery for construction equipment.
Rates listed in the Rental Rate Blue Book are intended as a guide to determine the amount an equipment owner should charge in order to recover equipment-related ownership and operating costs.
These rates are derived from cost formulas and factors developed from field research and from analytic methods used in the construction industry.
Generally, these methods include both direct and indirect costs and consider such operating variables as annual use hours, maintenance and overhaul costs, as well as unit price information such as fuel prices, labor rates, and the cost of money.
Profit, project overhead, and general company overhead costs such as office facilities and supplies are not included in the rates shown. Please see detailed cost explanations located elsewhere within this User Guide.
Over the last few years, rapidly changing the economic patterns that have impacted construction-related industries, volatile energy prices, as well as advances in data science and technology, have compelled us to adopt a more frequent update cycle for our online Cost Recovery and Internal Charge Rate data. If multiple configurations exist for a model, selecting a configuration is required before you can see your cost recovery rates. Choose the specifications relevant to your asset from the drop down menus.
You can make adjustments to your cost recover rates manually or by selecting an organization from the drop down menu. Most contracts will require certain adjustments to be made before submitting rates. You can then make location adjustments by city or state, adjust the ownership percentage, adjustment operating percentage, as well as the time standard displayed monthly, weekly, daily, hourly.
Tool & Equipment Rental Guide Rates Are EquipmentWatch Rates
If you would like to print your cost recovery rates for submission or for your own records, you can click the print button at the top right corner of the page. If you would like to download your cost recovery rates, you can click the download button at the top right corner of the page.
The data in the Rental Rate Blue Book is organized by equipment manufacturer and model, and includes models still in production to models discontinued as long as 30 years ago. This on-line cost recovery information is designed to provide accurate and authoritative information in regard to the subject matter covered. While all efforts have been made to assure total accuracy, the variable nature of the information and informational sources precludes any warranties of specific accuracy in any specific instance.
The term "rental" does not refer to third-party contracts for the use of equipment and as such, rates are not a tabulation of rates being charged by third party rental companies. Only by coincidence would RRBB rates match those charged by rental companies.
The most common application is in force account work and for federally funded projects. Additionally, FHWA states that the rates must also be adjusted for age and geographic region. User defined adjustments are also included in the FHWA rate shown.