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What does it cost to dig a hole?

When the proverbial Mrs Jones asks you to come out and dig a hole for her to plant her new Peony, you agree even though it's just hole of 300 x 300 x 300 mm. There’s no charge because she’s a good customer (and she knew your mum)

So, John and George go out in the van and dig the hole. It’s cost a bit but everyone is happy and it’s good PR
So, next week she asks you again and then because you did it so nicely her friend Marge in the next village would like you to do the same for her.
So, what does this really cost you

Well, John’s on £25000 a year and George (bless him) is on £17000. You could send George out on his own but he doesn’t have good social skills and anyway the guys are in two-man teams so it’s best just to send the two of them first thing on Tuesday.

It only takes 10 minutes to dig the hole so it costs just £3.98 in labour time.

As they’re about to leave Mrs Jones offers them a cup of tea and they’re on their way.

Final costs
Another 10 minutes for tea
And the time to get back to the real job that they’re on (2 x 20 minutes)
So, it’s taken the best part of an hour for this piddling hole
And if you use this example and move it across your business as a model:-

The 300 x 300 x 300 hole (.3 x.3 x.3) =0.027 m3
That means that there are 37.03 of these little holes in a 1 cubic metre hole

So, If John and George dug a cubic metre hole would it cost 37.03 x 3.98 = 147.40 to dig a big hole (forgetting the tea break and the transport time.
Suddenly I see that I’m not making anything on this and I have a real good look and ask myself why.

I realise that although I pay John and George £23.89/ 1 have to buy them some clothes for work, pay their national insurance. I realise that that’s costing me about £27.00 per hour for the two.
O yes I forgot there’s a vehicle and fuel and insurance and repairs so that brings it up to £33 /hour.
And George (bless him) sometimes doesn’t come to work but I still pay him his statutory sick pay and there’s a number of days each year when we can’t work due to weather so that brings their combined rate up to £34.00 per hour

Now Mrs Jones is actually a very nice lady and she insists on paying me.
I have to write an invoice (15 minutes including finding her postcode and a little chat on the phone)
Doris my book keeper has to enter it into Sage and I have to print an invoice for her and post it. Agatha (Mrs Jones insists I call her that now) doesn’t do email I pay Doris £20000 a year but she likes a bit of heating in the office in the winter and a big screen because she’s getting short-sighted.
Two weeks later when asks me to do another hole for her the pick head flies off and breaks her window. Luckily I’m insured - £4000 a year but that still adds 0.37p to the hourly cost of the 6 guys I have working for me and I must get a new pick.
Also, it’s time I make some money on this business of mine. I still have to charge for my advertising, Christmas party and traffic fines.

Agatha wants to pay me and I send her an invoice for the two guys with all their costs and my cut and the admin charges of the business for £55. for the hour.
When Agatha called me to discuss the charges I noticed when I answered my phone that she called herself Mrs Jones again.
So, what does it cost to dig a hole?

Sam


If of interest, I am a landscape consultant and developed the Gardencosts website for Garden designers and the LiberRATE  estimating system for Landscape contractors

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Replies

  • PRO

    Very good write up thank you

  • it also depends what the ground is like could take twice as long if its rocky

    • PRO

      The article is about a pricing by a consistent method, so you allow extra time!!

      There's always specific job based issues you need to take into accounts

  • That's a great article.
  • i enjoyed reading that

  • PRO

    Real food for thought and both amusing and enlightening. I too charge by the hour because I'm largely working alone, and I like my life simple. Maths was never my strong point! I also always estimate the time it may take me now because you never know what you're going to find when you start digging, like concrete or something. I have been stung before by crafty types who try to hold me to a price even though it may take longer than the time I thought it might, and then there's the people who insist that the time starts when you've hauled all your equipment through their house, which may take 15 minutes, not the moment you ring the doorbell, which is when I think of the time starting (that doesn't happen often though). I resolved then never to work for 'free'. I'd rather not do the job at all because I think those kind of things are totally unreasonable.

    • PRO

      Angela, you should introduce minimum charges...

      e.g you think the job will take 2 hours, and you charge £17.50 per/hour

      The minimum would be £40 and then £17.50/hr afterwards.  Do you cut the hour into 1/4's or 1/2's?

      So upto 2 hours £40, 21/2hr £43.75 3hr £52.50 and so on

  • PRO
    No job ever takes 20 mins, from arriving, taking tools out the van, travel time on to the next job etr it's why plumbers charge a minimum call out fee that's widely accepted with the general public but not so if a gardener tried it. Going out on day rates or minimum half days has minimised these awkward situations.
    • PRO

      And or depending on the specialised knowledge and level of skill required on some sites charge a premium rate . Knowledge and experience has some value and should be combined into the price along with the manual / physical effort .

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