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Estimating is a skill that can make or break a career or
company. Understanding the estimating and bidding
processes is essential for your business to remain
profitable.
This is newsletter #42 in the series. If you have
missed prior newsletters, and are enjoying the series,
we encourage you to purchase the complete Electrical
Estimating Program. Click on the coupon at the bottom
of this page.
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Determining Break-Even - Overhead |
The cost related to the operation and management of the company, such as rent, insurance, vehicles, administrative salaries, professional fees, and so on, is known as “overhead” and is usually obtained from your income statement or your accountant.
Author’s Comment: As business volume increases, the cost of overhead per labor hour decreases and smaller jobs and/or smaller size contractors have a higher ratio of overhead cost to labor as compared to larger jobs or larger size contractors.
Author’s Comment: Overhead application is beyond the scope of most electrical contractors without the assistance of an accountant or bookkeeper, but you need to know it.
For more information on this topic, get a copy of Mike Holt's Electrical Estimating video program and textbook.
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We'd love to hear from you about this series, and
the ways you're using it. Send us your comments
and feedback by clicking on Post a Comment below.
Look out for the next part in this series a month
from now, and please share with your colleagues.
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