It seems obvious profit is important to any business but some one-person businesses seem unaware. As with other businesses, the handyman business involves many costs including job materials, other fixed and variable expenses, and labor. Most persons in the handyman business wisely take all of these into account when calculating jobs. This is certainly wise but it overlooks profit, the most important thing to help businesses grow and ensure savings for the future. Without profit you have a job with multiple employers instead of a business.
Every job should include an amount for profit. Once you have calculated everything else then add a percentage for profit. I suggest at least 20% but for a busy handyman that amount can be higher. Just remember that profit is as important as any other aspect of every job and will increase the odds of your business succeeding financially. For a job that you are handling solely on an hourly basis, the hourly cost should include a percentage for profit. If you want to make $30 per hour and you want to make a 20% profit on every job, you would have to charge $36 per hour to make your hourly fee plus the profit.
At the risk of spending too much time on one topic, I am going to write more about profit for your handyman business. I believe that many businesses fail because of insufficient profit. And, in the case of one-person businesses this is an even larger problem. Many individuals believe that the amount of money they are paid for a job beyond the cost of materials is their profit. Even if they don’t label it profit and just call it their income for a particular job, this still poses a problem.
You would not work for anyone else without getting paid an hourly salary or a specific amount for a job so why would you work for yourself that way. To succeed in the handyman business you need to calculate how many hours a job will take and how much you want to be paid for the time spent on that job. Once you multiply the hours times the hourly rate you will know how much you must add to the total price of the job to pay yourself. Then you have to add the cost of materials and, if your hourly rate doesn’t include your other fixed business costs, you have to add those also.
Now that you have all of that calculated it’s time to add an amount for profit. Finally, you add all the costs, including the profit, and arrive at the total price for the job. That may seem like a lot of work and perhaps even quite complex but it’s the only way to make a good living from your handyman business.