I picked up $500 today

[Zeke]

I did a little work here and there around a house and the bill came to $500 labor and materials. I got paid in cash and headed home. I noticed my tank was pretty low, so I pulled in and bought 20 gallons. 100 bucks.

Things are messed up when 20% of my cash goes in the tank. OK, so no, I didn't drive 250 miles for this one job, but I bet I did 100 miles surveying the job, picking up supplies, going down there 4-5 times both ways. That's still nearly 7% of my gross income.

Now, we'll take this down: Actual gross profit - 450. 40% of that goes to taxes. Forget overhead. $270 minus the gas used for that work = $237 for 3 days part time + the background work. Figure around 24 hours total.

12% of my net goes in the tank. That's whacked, folks.

[craigster59]

[fastfredracing]

You silly contractors always complaining about the cost of fuel, and the cost to repair your trucks.
I have to own , and maintain a building before I make a buck.

[Joeaksa]

And its only going to keep getting worse if we do not START DRILLING! There is no reason in the world to not use our oil and stop sending our $$$ overseas!

[steve185]

We have more oil than most and the price of gasoline in Canada is higher the the USA, i don`t get it either.

[recycled sixtie]

If you really think that u are getting hosed for the price of gas, buy some shares of a large oil company.

[recycled sixtie]

Originally Posted by steve185

We have more oil than most and the price of gasoline in Canada is higher the the USA, i don`t get it either.

I think we pay more taxes per litre/gallon than the US residents do.

[Christien]

Actually most of your gasoline dollars come here and go to Venezuela, not overseas. And I believe the US has the cheapest gas in the world. Here we're paying $1.30/litre, which is just over $5 per gallon. When we were in Spain, the prices were around 1.40 euros/litre, or close to $7 USD per gallon.

[McLovin]

Originally Posted by Christien

Actually most of your gasoline dollars come here and go to Venezuela, not overseas. And I believe the US has the cheapest gas in the world.

The US doesn't have anywhere near the cheapest gas in the world.

There are many places where gas is hugely cheaper. Gas in the country you mentioned, Venezuela, for instance, is something like TEN CENTS a gallon for premium!

[Rick Lee]

I think Iran has pretty cheap gas, but then it's subsidized. Canada is still the largest supplier to the US.

[recycled sixtie]

Originally Posted by steve185

We have more oil than most and the price of gasoline in Canada is higher the the USA, i don`t get it either.

That is why we cross border shop. We go down to the US to buy Canadian gas at cheaper prices and US products are cheaper.
Sounds like win win to me.

[Christien]

Originally Posted by McLovin

The US doesn't have anywhere near the cheapest gas in the world.

There are many places where gas is hugely cheaper. Gas in the country you mentioned, Venezuela, for instance, is something like TEN CENTS a gallon for premium!

Sorry, I should've specified 1st world countries - that's what I was getting at.

[vbaron]

Actually, the US is a net exporter of fuel:

U.S. Was Net Oil-Product Exporter for First Time Since 1949 - Bloomberg

And that is expected to double by 2015:

U.S. net fuel exports to double in 2015-Wood Mackenzie | Reuters

It's all about profit...

[Hugh R]

So net you got about $10/hour. That sucks. The World is going to hell when you can't get craftsmen work done. People have no idea how much it really costs.

OTOH, I did a little on the side consulting over the last night or two for an old consulting firm client of mine and I'll bill him $125/hour and he'll bill the client around $200/hour. I'll probably bill him $1,000 for about 8 hours of sitting on my computer. Yeah, I'll get W-2'd on it, I'm technically a part time employee, and pay about 40% state and Federal income taxes on it. He has some more work he wants me to do. As long as he understands my daytime employer owns me from 8-5, he's OK with me writing up procedures and specs and discussing implementation with his technical/field staff.

This kind of work comes and goes. Last year I did about $5,000 on the side, the year before, about $25,000. I'm sure I could hustle a lot more, but after 10-12 hour days on the day job, I don't really want to work at night too much.

[Zeke]

Originally Posted by fastfredracing

You silly contractors always complaining about the cost of fuel, and the cost to repair your trucks.
I have to own , and maintain a building before I make a buck.

When the hardware store, the lumber yard, the paint store, etc. deliver all my parts to my door for free, I'll agree. And if I could own a building, write off the expenses and depreciate it all the while it is going up in value, I'd be there. But what is working out to $10/hr. for my time spent being a "contractor" is not going to buy me anything. Not even a new truck. When this one dies, I'm just going to pull out a chair and ride it out.

[Hugh R]

Zeke, OTOH, I stimulate the economy in that I'd rather pay a contractor to do a lot of stuff around my house than do it myself. Why would I spend 8 hours to half ass hanging an interior door, that looked like I did it when I can hire someone like you while I do consulting on the side? I make money and the contractor makes money.

[speeder]

Originally Posted by Zeke

I did a little work here and there around a house and the bill came to $500 labor and materials. I got paid in cash and headed home. I noticed my tank was pretty low, so I pulled in and bought 20 gallons. 100 bucks.

Things are messed up when 20% of my cash goes in the tank. OK, so no, I didn't drive 250 miles for this one job, but I bet I did 100 miles surveying the job, picking up supplies, going down there 4-5 times both ways. That's still nearly 7% of my gross income.

Now, we'll take this down: Actual gross profit - 450. 40% of that goes to taxes. Forget overhead. $270 minus the gas used for that work = $237 for 3 days part time + the background work. Figure around 24 hours total.

12% of my net goes in the tank. That's whacked, folks.

Part of the problem is that you are paying $5 a gallon for gas when it's close to $4 a gallon today. Unless there is something wrong with your math. I know that the cost of fuel for a big gas PU truck sucks but you cannot put a whole tank of gas on that job just because your tank happened to go empty and you decided to fill it up on the way home. That's fuzzy math.

If you take a small job, (or a big one, for that matter), far from home and commute to it in a 10 mpg truck, it's going to get expensive. You either need to build it into the bid or eat it. I don't take any type of work far from home w/o being paid for the time, much less fuel.

[brianmullanl]

And its only going to keep getting worse if we do not START DRILLING!

[Hugh R]

Denis, I think he did pro rate the gas at $50 for about 100 miles; he might have been using the IRS numbers of around $0.50/mile or so. But yeah, it still sucks.

[jyl]

Canada, the UK (North Sea), Norway, the USA are all big producers of oil.

Yet a barrel of oil for a refinery costs the same there as in countries that don't produce a drop of oil.

How can this be, since we're told that producing even more oil here will magically bring our gasoline prices down?

Because OIL IS A GLOBALLY TRADED COMMODITY. In all caps because so many people don't get it.

If the global price of oil is $90/bbl, then a barrel of oil produced in the US will sell for $90/bbl. Doesn't make a damn bit of difference if the well as drilled by Americans, pumped by Americans, or the oil is bought by Americans and refined into gasoline for Americans. The American company that produces the oil will sell it for the global price and no less, and is perfectly happy to sell it to a Chinese, French, Indian, etc buyer if American buyers don't want to pay $90/bbl.

The only way this would be different is if the government restricted the exportation of oil or forced oil companies to sell to domestic customers at a discount. As is done in some oil producing countries where gasoline is, therefore, cheap.

If this is unclear, read more on economics.