One of the most difficult things to do as a painting contractor is confidently price and sell consistently profitable projects. The good news is that there is a way to do this... It's called Time-Based Estimation.
Check out the video below for an introduction to time-based estimation:
What is Time-Based Estimation?
Time-Based Estimation (or production rate estimation as many contractors refer to it) is the number of hours it will take to perform a project multiplied by your hourly rate plus the materials needed to perform the job (unless materials are already combined into your hourly rate).
This method allows you to save time, produce predictable profits, and grow your sales.
What’s a time-based rate?
A time-based rate is the average amount of time it takes to complete a task. It uses two variables which can include sqft/hr, lnft/hr, or hrs/item.
How to estimate a project using time-based rates
1. Count and measure
Measure your space – when you enter a room, use a laser measurer to determine the space's length, width, and height. These dimensions will make up your wall square footage, ceiling square footage, and linear footage.
Count the number of items in the area, grouping like items together (windows, doors, etc).
2. Determine how long things take
Next, you’ll need to figure out how long your team takes on average to paint these different surfaces – your time-based rates.
3. Determine your hourly rate
Now, figure out how much to charge for your time.
Your hourly rate is your business broken down into one number. Knowing exactly what you need to charge will give you confidence in how you value your business.
4. Add it all up
After you've followed all the steps above, you have everything you need to make your calculations.
Make sure to add on any materials, if you price them separately.
Let’s put this into practice with an example:
The bedroom being estimated is 12ft x 15ft, with an 8ft high ceiling. The customer wants the walls, ceiling, baseboards, two window frames, one door, and frame on one side painted with two coats. No patching and no setup time will be taken into account.
How many hours will this project take?
Using time-based rates, you can then calculate the total number of hours it will take to paint this bedroom: 13.5 hours
So what does this bedroom actually cost?
Once you have the total number of hours, you simply charge by your hourly rate to get your price, plus materials.
Hourly rate: $67/hr
Labor: 13.5 hours x $67/hr = $904.50
Materials: $155.71
Total: $904.50 + $155.71 = $1060.21 for the bedroom
How time-based rates are calculated
To calculate your time-based rates, all you'll have to do is grab time tracking information from past jobs. If you're just starting out, this is a great time to start tracking your time to see how long projects take!
You'll need to consider:
The size of the space
The length of time it took you to paint the space
The number of coats
Make sure to check these rates periodically to ensure that they are accurate.
If you’re working in a room with 425 sqft of previously painted walls and it took you 5 hours to paint two coats, the calculation would be:
425 sqft ÷ 5 hrs = 85 sqft/hr
Therefore, you can paint two coats across 85 sqft per hour on this surface.
This will become your time-based rate going forward.
Commonly Asked Questions
What if my team paints at different speeds?
In your business, you might find that, as you calculate time-based rates, some employees paint faster than others, some produce better quality, and others move slower to achieve perfection.
If this is the case, you’ll want to calculate your time-based rates at an average level.
What do you mean by “average level?”
The average level is the speed at which an experienced employee can paint a given surface at a comfortable and natural speed. To offset the difference in speed among employees, you should be paying them different wages to account for their varying skill levels.
How can I create and customize my production rates in PaintScout?
Great question! Once you're ready to use time-based rates in your business, learn how to set them in your PaintScout account here >