Examples / Fictional worked example

Three visits per week at a small office

This is a fictional worked example to show the formula. The wage, burden, and hours are not recommended rates or observations from a real job.

Assumptions

• Three visits each week for 52 service weeks: 13 average visits per month.
• Three cleaning person-hours and 30 additional paid person-minutes per visit: 45.5 person-hours monthly.
• $20 base wage plus 25% entered burden: $25 loaded hourly cost.
• $6 supplies and $3 equipment allocation per visit, $150 monthly overhead, and $50 contingency.
• 20% target operating margin.

Calculation

Monthly labor is 45.5 × $25 = $1,137.50. Supplies are $78 and equipment allocation is $39. With $150 overhead and $50 contingency, modeled monthly cost is $1,454.50. Dividing by 0.80 gives $1,818.125, displayed as $1,818.13. Price per visit is $139.86.

If labor rises by half a person-hour per visit, modeled cost rises by $162.50 to $1,617.00. At the original unrounded selling price, margin falls to about 11.06%. This illustrates why the first month should be reviewed.

Public fixture ID: office-three-visits-v1 · Model 1.0.0