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How do I calculate Unbillable %?

Start with your unbillable %.  You need to estimate how many payroll hours are not recovered via job estimates.  These are likely payroll hours spent:

  • Loading/unloading/driving (if you don't include that time in estimates)
  • Mistakes, unforseen problems, delays
  • Going over budget on estimates
  • Working around the shop
  • Warranty + rework
  • Meetings and hanging around
  • Doing deliveries, disposals and moving equipment (where this time was not included in the estimate)

Basically you need to try to calculate how many hours you paid out in payroll that were not recovered via customer estimates.

The average unbillable time varies, but here are some averages (note these are just industry averages - make your best attempt to calculate your unbillable %):

Install companies that estimate in full days (e.g. - every hour spent loading/driving/at the job/driving and unloading):  10% - 15%

Install companies that don't include load/unload/shop/driving time in their estimates:  20 - 30%

Maintenance companies that include driving time in their estimates:  10% - 20%

Maintenance companies that don't include load/unload/shop/driving time in their estimates:  25% - 35%

If you want a more detailed explanation of Unbillable time and how it affects maintenance-style and construction-style estimates, read the articles below:

  • For maintenance jobs, click HERE.
  • For construction/install jobs, click HERE.
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