contracting rate help

[mlchris2]

It's been a few years since I've done any professional contracting and I need to determine what a marketable rate would be for my area (Salt Lake City - Utah). I recently been offered a job to evaluate and resolve a networking issue at the corporote office of a local retail chain.

I do work for friend and family and charge $50.00 an hour for basic pc/home-networking.

My experience and skill level is advanced. I just havent done much professional contracting work. I work as a Sys Admin and i am paid at an hourly rate of $30.00-$40.00.

I've searced the web and couldnt find much. I was thinkin about charging $50-$100 on this job, depending on the type of work, etc.

Advice???

Mark C.

 

[SantaMufasa]

Mark,

I, too, do IT contract work in the Salt Lake City area. I do all of my work remotely, however, to sites all over the world. I do database administration.

I set my rack rate comparable to the hourly rates that Oracle Corporation charged out for my work when I worked for Oracle ($250/hr.), but (and this is a big but) I charge my customers by the second, with no minimum whereas Oracle Corporation typically rounds hours to the nearest hour, with half-day or full-day minimum (which makes using Oracle Consulting unreasonably costly for dealing with short, simple questions). If I can resolve a customer's question in 94 seconds, I charge them for 94 seconds of consulting.

I also consult for the IT department of the headquarters of a large religious organisation in the area. Because they pay no contractor anywhere near my rack rate, I do work for them at their maximum hourly rate because I want to help them and because I'm a member of their organisation.

I also offer my customers a discount on my hourly rate for pre-payment (retainer)...They pay me at a pre-arranged, discounted rate because they pay me before I do work for them.

My recommendation to you is to find consultants/contractors that do work similar to yours for the locality where you want to work and use that as a guide to ensure that you are competitive.

Let us know if any of this is helpful to you.

Mufasa
(aka Dave of Sandy, Utah, USA)
[I provide low-cost, remote Database Administration services: www.dasages.com]

 

[xwb]

It also depends a lot on whether there is an agent involved. In the UK, they charge 20% on top of your rate. So if you're charging $40ph, the customer is actually paying $48ph.

 

[SQLSister]

At a minimum you will need at twice your current hourly wage to make the same amount because you will have to pay for your own benefits.

First calculate what you will need to to maintain or imporve your lifestyle. Remember that you will likely have times when you don't have any work and need to put some money aside for that. Health insurance is a biggie and can be very expensive if you aren't part of a group especially if you have nay health issues in your family. YOu will want some extra to cover for vacation days as well and office space if you are planning to rent an office vice work out of your home.

To see what the market will bear, call some local consultants and have them price out a job for you.

Then compare your minimum to what the market is charging. If you are significantly under change what you are charging. People will pay consultants top dollar and may not trust one who is too cheap.
Compare the two figures.

"NOTHING is more important in a database than integrity." ESquared

 

[JCreamerII]

Also, remember your paying both ends of the SS tax, the employee & employer end. That's over 15% off the top, just for SS, not including your standard withholding. You'll also have to fund your own retirement, no 401K or pension, (like anybodies got one of those anymore).

Thanks,

Jim C.

 

[SantaMufasa]

You'll also have to fund your own retirement, no 401K or pension

Mark, you are extremely lucky in this regard, to live near the finest organization in America for properly setting up your retirement: American Pension Services, based in Draper, Utah (801-571-0667). Their president, Curtis DeYoung, and his people are absolute geniuses when it comes to setting up well-behaved retirement for you. Since you will be self-imployed, you can set up self-directed Individual Retirement Accounts (IRAs), self-directed 401(k) Plans, et cetera. (The fact that the plans are self-directed means that you have total control over how the money is invested and earning [including being invested in even your own company!])


You also will probably want to be set up as an S-Corp (since you will be generating active income versus passive income, which works better in an LLC). I can advise you on an equally genius set of lawyers and accountants (based out of Cedar City, Utah) whom I trust implicitly, and who can take great care of you setting up your business entity, protect you legally, and deftly handle your accounting for you.

Lemme know (via my signature if you wish).

Mufasa
(aka Dave of Sandy, Utah, USA)
[I provide low-cost, remote Database Administration services: www.dasages.com]

 

[kaht]

I do work for friend and family and charge $50.00 an hour for basic pc/home-networking.

You charge your family for helping them with their computer issues??

That's pretty cold blooded man....

In my family I have a plumber, an electrician, an automotive repairman, and a general construction contractor. I'd like to think that if I ever need help from any of them that they wouldn't charge me. And for that reason (among many others) I sure as hell wouldn't ask them for money if they needed help with their computer.

-kaht

Lisa, if you don't like your job you don't strike. You just go in every day and do it really half-assed. That's the American way. - Homer Simpson

[small]<P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <B> <P> <.</B>[/small]

 

[sillyVM]

=)
And mufasta gave me help for free! Glad to know that was a $250/hr I was getting for free! Much thanks. hehe

 

[lespaul]

In my family I have a plumber, an electrician, an automotive repairman, and a general construction contractor

I need all of those, can I come be part of your family? We don't have any in mine......

leslie

 

[SantaMufasa]

Glad to know that was a $250/hr I was getting for free!

It's called Pay It Forward, VM. <smile>

Mufasa
(aka Dave of Sandy, Utah, USA)
[I provide low-cost, remote Database Administration services: www.dasages.com]

 

[Stella740pl]

kaht,

In my family I have a plumber, an electrician, an automotive repairman, and a general construction contractor. I'd like to think that if I ever need help from any of them that they wouldn't charge me.

That probably depends on how much help you would need. I would guess that you probably won't expect your relatives to build you a new home (or even an extension) and install all the plumbing and wiring for free, just for the cost of materials.

If you need that much help, you should offer to pay them (and you might get a good price), or hire someone else. If you just need some small thing occasionally, then it shouldn't be a problem. But if you expect them to help you for free on a regular basis (thus taking them away from their families and other things), you would be imposing. They soon will come up with real or fake reasons why they cannot do it.

Same the other way around. If they ask you to help with something that won't take too much of your time too often, of course it's better not to even mention money. But if they expect you to do everything all the time and also be on call and provide 24/7 tech support for free, you probably would be better off declining - or charging money.

I am not comfortable getting money from family and friends, or paying them, that's why I don't usually ask for much professional help except for possibly very rare telephone consultations, and don't provide myself much more than the basic computer help to the closest relatives.

But we have somewhat wandered off topic here.

 

[genomon]

Last Christmas I got a t-shirt from my brother (CCNA) from ThinkGeek that says "No, I will not fix your computer for free."
Case closed!






Money can't buy happiness -- but somehow it's more comfortable to cry in a Corvette than in a Yugo.