Lowest Cost Installations

March 20, 2003

We all know that time costs money, but when it comes to crew mixes, sometimes taking longer can save you money.

It may not always be in your best interest to have your fastest people doing the bulk of installation work. Proper job crew mixes can make a big change in the profit or loss you see on a job. The key is finding the way to get the lowest installation cost per unit vs. the fastest installation time.

Example:

On crew #1 you have two excellent journeymen and a working foreman that can install faster than any other crew on the site. The costs for this crew are:
Working Foreman wages and benefits = $50/hour
Journeymen wages and benefits = $40/hour X 2 = $80/hour
Crew hourly rate = $130/hour

Crew #2 consists of a journeyman, an apprentice and a helper. This crew does not work nearly as fast as the more experienced crew above, usually taking about 50% longer to do the same installation.
The costs for this crew are:
Journeyman wages and benefits = $40/hour
Apprentice wages and benefits = $25/hour
Part-time Helper wages (no benefits) = $12/hour
Crew Hourly rate = $77/hour

For a project that takes crew #1 a total of 4 eight-hour days to complete, you can easily see which crew had lower costs.
Crew #1: 8 hours X 4 days X $130/hour = $4,160
Crew #2: 8 hours X 4 days X 1.5 (crew takes 50% longer) X $77/hour = $3,696

You must take other costs for having crew #2 on the site for the extra days into consideration, but overall you will likely win with crew #2. Always look for ways to have the lowest cost per installed unit, not the fastest installation time.

This information is brought to you by the
PHCC Educational Foundation .


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