| Terminology |
Used
in BidPro Software |
| Burden
Rate % |
Rate applied
to Raw Labor Cost for company provided benefits. A worker paid
at $15.00/hour (raw) would actually cost the company $19.50/hour
based on a 30% burdened labor rate. Using that same scenario, the
sell price per hour for this worker would be $31.20 based on a
60% Labor Markup %. This would yield an $11.70 profit for each
hour that equates to a 37.5% Gross Profit Margin (GPM) |
| Cents per Mile |
Usually defined
by tax-board values (current rate per mile) |
| Contract Average
Burdened Labor Rate/hour |
Total project
burdened labor cost divided by the total labor hours to obtain
and average project rate for employees with benefits. |
| Contract Average
Raw Labor Rate/hour |
Total project
labor cost divided by the total labor hours to obtain and average
project labor rate. |
| Contract Average
Raw Labor Rate/hour |
Total project
labor cost divided by the total labor hours to obtain and average
project labor rate. |
| Direct Job Overhead
% |
DJO
is and ongoing administrative business expense which cannot be
attributed to any specific business activity or job, but is still
necessary for the job function. DJO is the rate applied to Raw
Labor Rate for management/overhead related activities. Some companies
have set this value (higher) to achieve a "net" profit
versus a "gross" profit.
|
| Freight % |
Calculates percentage
of total material cost and is attributed to material freight/delivery
charges anticipated on the project. (average 5%) |
| Gross Profit |
Project sell
price minus project costs (in dollars). |
| Gross Profit
Margin (GPM) |
A good starting
point for product/service pricing. Project sell price minus project
costs divided by project sell price times 100 (in percent). Higher
percentage is better. |
| Labor Hours |
Total labor
hours to accomplish the project. All labor grades. |
| Labor Markup
% |
Rate applied
to labor costs. Yields the Labor Sell Price. |
| License/Permit |
Permit
costs and license fees will apply to this project. |
| Location Labor
Sales Tax % |
Some states
require tax on labor sell price. Varies state-to-state. |
| Location Material
Sales Tax % |
Usually tax
rate is calculated where material is installed. Varies state-to-state. |
| Material Markup
% |
Rate applied
to material costs. Yields the Material Sell Price. |
| Mileage |
Can worker/technician
claim mileage expenses for this project? Calculate round-trip mileage
at "Cents-per-mile" rate. |
| Misc. Material |
Calculates percentage
of total material cost and is attributed to intrinsic or incidental
items (hangers, brushes, tape, buckets, extra mounting hardware
etc.). |
| Net Income |
Same as Net
Profit, used to calculate income tax owed. Gross Income minus incurred
expenses. |
| Net Profit |
Same as Net
Income, used to calculate income tax owed. Gross Income minus incurred
expenses. |
| Non-Productive
Time (hours/day) |
NPT is the hours
not available per day (and per person) for planned task activity.
These hours are converted to cost/hour for each worker/technician
on the job. |
| Paid Parking |
Will project
have parking expenses? Some downtown locations could be $15-$25
per day. Note: some vans do not fit in underground structures and
will need to be parked on the street or public-paid lot. Parking
$ Cost/Day/Crew Member Daily rate for parking. Note: on a 6 month
or yearlong project, these charges could be very large. |
| Pay Sub Tax "Upfront" as
Cost ? |
Allows company
to pay all applicable subcontractor taxes upfront and signifies
to BidPro that those taxes are considered costs to marked-up via
the subcontractor labor and/or material rate. Varies state-to-state. |
| Per Diem |
Will project
have overnight stay requirement? Per Diem Amount paid to worker/technician
for 1+ overnight stay (usually for room & board). Varies state-to-state. |
| Preburdened
Labor Rate |
Average labor
rate of all project employees based on raw labor rate and number
of hours worked. This is useful in determining how each person
will affect project costs and most importantly company profits
of add-on or follow-on work.
Example 1:
2 workers for 1 hour (worker 1 paid $15/hr raw and worker 2-$30/hr
raw): average preburdened
labor rate would be $22.50.
Example 2:
worker 1 ($15/hr raw) worked 123 hours and worker 2 ($30/hr)
worked 78.5 hours. The
preburdened
labor rate would be $20.84. |
| Premium Time |
Weekend or Union
Pay. Adds the percentage to raw cost and is value is displayed
on Summary and Margin Sheets. Premium Time Differential (per/hour)
Rate per hour added to each hour a person works on the job. Adds
the percentage to raw cost and the value is displayed on Summary
and Margin Sheets. Premium Time Rate Rate applied to Raw Labor
Cost for Union Labor or weekend/special rates. |
| Prevailing Wage |
Usually state
related jobs dictate wage amounts based on time-in grade and type
of classification. Prevailing Wage Rate per hour added to each
hour a person works on the job. |
| Raw Labor Cost |
Total labor
cost paid to technicians/workers (before any company expenses,
401K, Health Benefits etc.). Usually labor rate per hour quoted
@ hire date or after raises to base rate. |
| Return
on Investment (ROI) |
An accounting
valuation method, Net Income divided by the Book value of Assets.
Used in these programs as a performance measurement. Equation is
Sell Price minus Cost divided by the Cost. |
| Site Survey
Completed ? |
Yes indicates
PM or estimator has been to the site for evaluation. No - may indicate
best guess ??? on material and labor. |
Subcontractor
Location Labor Tax %
|
Allows company
to specify how tax rate is treated on project. Varies state-to-state. |
| Subcontractor
Markup % (average 15%) |
Industry average
markup on subcontractor costs are 15%. Tax on Material (M) or Labor & Mat
(LM) Tax will be calculated for material (M), labor (L) or both
(LM). |
| Bid Raw $ Raw
Labor Rate/hour |
Raw rate is
the rate of pay to the technician prior to company expenses, 401K,
Health Benefits, etc. |
| WBS Work Breakdown
Structure |
General term
for Employee Classification that will perform the task. |
