Arkansas HVACR NewsMagazine January 2020

Business

percentage point reduction in net profit of the company at the end of the year.

Let’s take that one step farther and do the math with our whole team averaging 35% non-billable. 5 techs X 8 hours per day X 65% billable time per day X 240 working days per

Even a duck can be under the weather

year is a total of 6,240 billable hours. Now we have to subtract those 78 sick hours from this total. That means we will really only have 6,162 billable hours. If you spread that lost revenue of $11,700 across these remaining billable hours, you would have to increase your labor rate by $1.90 / hour to make up the difference. Make sure you are calculating your hourly rate correctly. Your team is going to get sick. You are going to get sick. Not looking at this realistically can cost you thousands per year and mean the difference between profitability and losing money.