Electrician costs - need help understanding

ashebrookFebruary 28, 2012

My husband and I are renovating a 1939 house that was a rental unit for decades. One of the interesting features of this nearly unaltered 73 year old house was the lack of electrical outlets. Most rooms only had one.

We recently had two electricians come give us estimates to add outlets and some new light fixtures. Both electricians were highly recommended by friends and both said that they would only do the work on an hourly basis. Both said that the work would probably only take a day. One asked $75/hour and the other asked $65/hour.

No mention was made about the cost of materials, which my husband and I thought were fairly small because we were needed the outlets and wire. We even bought the face plates ourselves.

The work actually took almost two full days which was fine and we did not quibble with the gross underestimate of time. We were expecting a bill for around $1000-$1200. We just received a bill for $2400. The bill does not itemize materials.

Can anyone help me understand how the electrical materials are more than the cost of the labor?

We got:

-8 regular, inside outlets

-3 outside outlets

-4 boxes for one new light and three smoke detectors. (we bought and installed the light and smoke detectors)

-enough wiring for all that in a 1400 sq ft, 2 story and a basement house.

Thank you for helping.

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brickeyee

Ask them for a breakdown.

You are not really entitled to one since you did not ask up front, and it will take time to put it together (at the same cost as any other work they perform).

Not having a written contract leaves all sorts of things flapping in the breeze when a disagreement occurs.

How much plaster damage did they leave you with?

Minimizing plaster damage adds a LOT of time to wiring.

It is very fast to come in and just bash holes as needed.

    Bookmark   February 28, 2012 at 3:39PM
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ashebrook

My husband has left a message that has not been responded to. We would definitely like a breakdown of materials.

From what I can see the materials cost in the neighborhood of $250.00. $1400 is a 560% markup. Doubling the cost of the materials would seem like more than enough markup to me.

I am interested in hearing from the professionals about what customary markups are.

    Bookmark   February 28, 2012 at 3:56PM
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btharmy

"We were expecting a bill for around $1000-$1200"

Which person did you actually hire? $75 or $65? How many hours were actually worked? Depending on the hourly rate and hours worked, that should about cover labor for 2 long days. Sounds like he did mark up the material a bit. However, by the time you buy the bell boxes, GFCI recepts, in-use covers and wire, the material for the "3 outside outlets" should run about $100 alone, before mark-up. Then another $125 for a permit (check your local fees). There is $225 already. So, your $250 ballpark for material is a too low. You should always ask for a price before work begins. Don't go T&M until you know and trust the worker. If going the T&M route, protect yourself with some documentation as far as materials and hours worked.

    Bookmark   February 28, 2012 at 8:05PM
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ashebrook

Hi btharmy,

We went with the $65 per hour electrician. He worked almost two days: maybe 14.5 hours. We accept him calling it 16 hours to account for picking up materials. That equals $1040.

I am learning more and more about contractors markups and think it is reasonable for a contractor to do that. Even if the materials cost twice what I estimated (so $500), how do I reasonably get to $1400? If the materials were $500 and he charged a 50% markup, we are still only at $750.

    Bookmark   February 28, 2012 at 8:46PM
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hexus

How many guys did he have with him? Though he should have explained this up front, if he had other workers with him, the $65 an hour isn't going to cover everyone's labor that was on the job.

    Bookmark   February 28, 2012 at 11:49PM
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ashebrook

There was only one electrician on the job.

The labor portion of the bill is $1040. All the rest is materials and, what I consider, an exorbitant markup.

I am interested in commentary from the professionals about what is customary.

    Bookmark   February 29, 2012 at 9:47AM
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bus_driver

Everyone has their own pricing system. Today, $65.00 per hour will not produce a profit for a tradesman who must be licensed and insured, provide trucks and tools, a business premises, pays taxes, etc. The time and expense to get materials is considerable. And whoever buys the materials really "guarantees" them. I bought a case of steel boxes, installed them on a ceiling 22 1/2 feet high, installed the conduit, pulled the wire. Then discovered that on of the fixture mounting screw holes was not tapped. Hand tapped the holes as the fixtures were installed. Have bought boxes of devices only to discover at the job site that the contents of the boxes were different due to manufacturer error. Seems unfair, but this does impact the final customer.

    Bookmark   February 29, 2012 at 9:50AM
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brickeyee

"Doubling the cost of the materials would seem like more than enough markup to me."

Based on what?

How much time, labor, and mileage did it take to purchase the parts?

Do not forget that the labor rate applies to purchasing parts also.

This all should have been defined in a contract before any work was started.

Neither of you appears very 'professional' in your handling of this.

    Bookmark   February 29, 2012 at 10:19AM
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ashebrook

I agree that professionalism was lacking on both sides of this equation.

In my own defense, I have never had electrical work done and when someone says I will charge you $65 per hour and it will take a day, I am going to expect a bill for $520 or thereabouts. When the job timeframe doubled (which is already bordering on an abusively misleading quote) I did not quibble. But then to be hit with another whammy by being given a bill with charges more than 100% of the labor costs, when materials were never discussed seems deliberately misleading and deceptive to me rather than unprofessional.

What I am learning is that it is common practice for contractors to quote a lower hourly rate with the hope that higher fees can be hidden in unitemized materials charges.

This is terrible business practice and leaves to ill will on all sides. Why not be totally transparent and say my real costs are $100 an hour and you can stand here and make sure I bill you accurately for my time rather than play some game by obscuring fees in markups?

    Bookmark   February 29, 2012 at 10:55AM
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live_wire_oak

"Why not be totally transparent and say my real costs are $100 an hour and you can stand here and make sure I bill you accurately for my time rather than play some game by obscuring fees in markups?"

Because most people would still pick the $65 an hour guy because he's cheaper----even though it ends up costing them more than someone who gives them an honest estimate.

    Bookmark   February 29, 2012 at 3:17PM
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ashebrook

I get your point, live wire oak.

Unfortunately, this tactic got this electrician this job, but we will never hire him again and I will inform all of my friends about this tactic. So, in our small town, I would say that this tactic is part of a very poor long-term strategy.

It is also a poor short-term strategy because he has an irate customer who feels deceived and who will fight over the bill and cause a lot of unnecessary drama.

    Bookmark   February 29, 2012 at 4:02PM
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btharmy

You wouldn't believe how many long time customers pick another guy because he is "cheaper" than me on a given quote, then tell me later it ended up costing them more in the long run in extras, un-expected down time and aggrivation. That up front price sounds real good, the actual "cost" of the job is what you should be concerned with. It takes a while for some to turn down that enticing low bidder in exchange for a skilled, reputable, licensed professional.

    Bookmark   February 29, 2012 at 7:29PM
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ashebrook

btharmy,

You can count me among the converted. Thank you for taking time to respond.

    Bookmark   March 1, 2012 at 11:52AM
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