Trade rates experience

We get discussions on trade rates quite a lot, thought I'd just post some of my contemporary experience.

I'm renovating a 2 bed flat for my daughter, it's a building site throughout (uninhabited) and so every trade has been brought in at the right time, with the correct amount of preparation done. In most cases it's the easiest domestic job they'll ever do as I have enabled them to get straight on with any work. I deal with all waste management etc, so I just need them to come in, do their job and leave.

I will say that I had no issue at all getting trades in to quote, I got at least 5 for every job, most came around within 2 days of first contact and I got written quotes promptly. It may have helped that all the jobs were a decent size, and fairly precisely specified.

Location is commuter belt SE, so postcode taxes definitely apply.

Central Heating Installation
I ripped out all the old (1970s) storage heaters, so needed a combi boiler and all new pipework run to 5 radiators and the bathroom and kitchen. I chased out the walls for pipe runs and lifted floorboards where necessary, so they just had to come in and lay pipes (I wanted 100% copper). I provided the radiators and valves, all they had to provide was the boiler and gubbins - arrestor, magnaclean etc - and pipework.

Got 5 quotes in, prices ranged from £5750 (no VAT) to £10,500+VAT! Most were in the £6000+VAT range.
I went with the cheapest one as the chap described exactly what he would do.
Took 2 of them 2.5 days so 5 man days total. Materials would have been around £2000 (boiler was £1500).

Day rate: £750

Electrical
I did most of the electrical work myself but I got a sparky in to test existing electrics (rewired but all pre-2006), help disconnect a secondary CU that ran the old storage heaters from the incoming 80A cable, and to do the first and second fix in the kitchen including creating a new ring main and various power points and FCUs, and new lighting circuits including downlight installation.

Cost £990 for 4 shortish days (around 09:00 to 15:00) including some materials like cabling and trunking.

Day rate: £225

Plastering
Had 5 rooms completely plastered, including 2 ceilings and a landing. I estimated it as 5-6 days work.

Got 5 quotes in, the eastern Europeans who responded ranged from £1800+materials, to around £2500 all in. The UK operators wanted £3500+VAT.
I chose one of the eastern Europeans, turned out he was Romanian. He's done the best plastering job I've ever had and used tools and techniques I've not seen British plasterers used before. He spent ages floating off every wall over and over. His activity levels were about double what I've seen plasterers do before - who do first coat on one wall then go off and sit in the van for 20 minutes while it goes off before the second coat. This guy would get another wall coated up instead.

In the end I bought the materials so he got £2100 and it turned out he wanted cash so undoubtedly it won't be declared. He was quite upfront he was over here "for the money".

Took him 5 elapsed days of relatively long hours, two of those were half days but on another 2 days he had his wife with him who cleaned his tools between phases and cleaned up etc and probably made him 50% more productive on those days, so call it 5 days work.

Day rate: £420

Overall the sparky was good value, the plasterer did excellent work but is earning more than £80k tax free, and the plumbers are taking the piss. All the plumbers said it would take a week which felt toppy to me (and turned out to be so) but I couldn't find anyone cheaper.

Same with any business, there are overheads and a hidden cost of bidding for work.
I also don't have an issue with people working hard/well and getting paid for it.

I have an issue with the plumber saying, on bidding for the work, verbatim: "it looks like 5 days work and my mate and I need £400 a day out of it". I thought that was fair, for a day rate. The job actually took them 2.5 days. Now, I know some people will say "but they overestimate on some jobs and underestimate on others and it all comes out in the wash". In my case the job couldn't have been more transparent - floors were up, ceilings were down, pipe runs were easy. So him being 100% inaccurate in his estimation cost me £2000 on his quoted rates.

I don't have an issue with the Romanian who worked literally twice as hard as British plasterers I've seen in the past (subbed through my usual builder in most cases) AND gave me a better finish, and charging a day rate twice as much.

I DO have an issue with him demanding cash (and almost certainly not declaring it) as I don't agree with the principle.

My guys did. I insisted on copper throughout, was prepared to accept pre-soldered fittings but was pleasantly gratified to see them work with flux and solder in the old fashioned way. I still think it's the best way.

The worst that can happen is you get a dry joint embedded in the wall or under a finished floor you find out much later when it leaks...the first time you do something it's always a sub-optimal job and with water you end up with a big exopensive mess.

I do wish I could do it though.

Let’s break this down.

You want a £60k salary, and then you want £20k “profit”. WTF is “profit” on top of salary? For self employed it’s all take home. It might be treated differently (more favourably) for tax if the “profit” is in a ltd company vs PAYE, buts it’s all income for you.

Then you want 20 days holiday, and you want to make the numbers above even if you have 20 slack days. So that’s 40 days not actually working for your £80k.

Then you want all the costs of being a trader to be covered so you actually get your £80k in your hand.

Now compare that with the PAYE market of your customers. The market says “the salary for your middle manager job is £50k”.

Out of that comes N.I., the bulk of any pension contributions, the £3000 after tax cost of a season ticket, you get to spend 3 hours a day commuting on a packed train, and you get 20 days holiday. Oh and probably no overtime for any extra hours you may be expected to work.

Sorry but the argument you just made there makes it clear why people might think you’re having a laugh because to get an equivalent PAYE package to your trader numbers above you’d need to be on £120k+ and that’s obviously a tiny fraction of the market.

Even so, all your numbers above are easily covered by the plumber who quoted me he wanted £400 per day and then ended up taking home double that.

I’ve got no objection to decent trades making a decent living but for whatever reason the domestic market is now a very happy hunting ground for trades and all the bleating in the world about slack days and business overheads doesn’t change the fact that your take home income, on your numbers above, puts you at least x4 the national average with twice as many days not working.