Most electricians are busy every single day, yet at the end of the month, the bank account is empty. If you're working full-time but only getting paid part-time, you're running on a hamster wheel because your pricing is based on guesswork instead of math.
The Reality Check
If you’re charging $100 an hour but only billing four hours a day after driving and quoting, you’re only bringing in $400. Once you pull out expenses and non-billable time, you might be walking away with $130. That isn’t enough to buy the next van, hire a team, or even replace a lost tool. To fix this, you have to stop charging like an employee and start charging like a business owner.
"When you actually believe your pricing is fair, your customers will too. Confidence in your pricing builds trust, and when people trust you, sales gets easy."
Step 1: Finding Your True Efficiency Rate
The most overlooked number in our industry is the efficiency rate. This is how you account for the time you spend working that you aren’t actually getting paid for. Use the Efficiency Rate Calculator at electricianacademy.co/tools to track these non-billable drains:
- Material Runs: That "quick" 30-minute stop at the supplier once a day adds up fast.
- Admin & Permits: All the hours spent on the phone, filing paperwork, and booking inspections.
- Travel & Maintenance: Fueling the van, vehicle maintenance, and transit between service calls.
By the time you subtract holidays and downtime, you'll see your true billable capacity, which is the foundation for your new rate.
Step 2: Calculating the Billable Hourly Rate
Once you have your efficiency rate, plug it into the Billable Hourly Rate Calculator. You need to be honest about four specific inputs:
- Labor Burden: This is roughly 20-21% on top of the hourly wage to cover taxes and benefits.
- Actual Overhead: Insurance, shop rent, software like Pricebook, and marketing costs.
- Efficiency Rate: The percentage of your day that is actually productive and billable.
- Profit Margin: In electrical service work, a 30% margin is often too low because marketing and small jobs are expensive to manage. Aim higher to ensure you can actually grow.
Conclusion
The first time you quote a job with a true, calculated rate, you might feel like you’re going to choke. I’ve been there—sitting in the van, freaking out before presenting the number. But when you charge enough, you can pay your team better, buy better materials, and stop stressing. Stop guessing, use the tools, and start running your business like a real business.
