Post
by Ian » Thu Mar 15, 2007 12:06 am
If you have a few moments, let me tell you how the "per hour" charge is worked out. All is not what it seems. And I know this because, in a previous life, my job was to work out the "chargeable rate".
This is a simple scenario but will illustrate the point. Get your maths head on.
Let's take the example of a medium sized, family run garage where they have 6 mechanics (at £25,000 pa), a manager (at £35,000), a supervising mechanic (£25,000), receptionist (£15,000), & admin assistant (£15,000). The premises cost £10,000 pa, advertising costs £10,000 pa, and utilities cost £5,000. Plus business rates of £5,000. Total costs, before any work done, of £250,000.
PLUS, if it is a PLC with dividend payments etc, or perhaps repayment of start up costs, will bring it up to £300,000.
So, we have 6.5 mechanics. BUT, after leave and sickness are built in to the equation, each mechanic works 215 days per year, not 365.
So the total amount of hours worked by the firm are (6.5 mechanics x 215 days x 7 hours) = 9,783
And as the costs for running the business are £300,000, divided by the number of hours available, the per hour charge is £30.67p.
So for a large dealership, the costs will be higher.
668. The Neighbour of The Beast.