APE October 2023 | Página 6

COVER STORY | ADVERTORIAL

$$$$ $$$$$ What does Infrared Repair

ACTUALLY CO $ T ?

At this point most contractors are familiar with what infrared repair is and how it works . One thing that is not often discussed is the actual cost to perform an infrared repair . The general rule of thumb and what most manufacturers will say , including KM International , is it is 1 / 3 the cost of traditional methods like saw cut remove and repair . But what does 1 / 3 the cost actually break down to ? The below chart outlines the average revenue , expenses , and profits one could expect when performing infrared repairs . And yes , we understand everyone ’ s costs are going to be different , but these numbers are accounting for industry averages from across the U . S .

Description
Break Down
Per Repair ( 40 Sq . Ft )
Daily
Annual ( 150 Days )
GROSS RECEIPTS
800 Sq . Ft / Day @ $ 4.25 / Sq . Ft ( 20 Heats Daily )
$ 170.00
$ 3,400.00
$ 510,000.00
MATERIAL
Asphalt : 2 Tons @ $ 75 / ton
$ 7.50
$ 150.00
$ 22,500.00
FUEL
Propane : - KM 4-40 and 4000SXPX - Six ( 6 ) 30lb Cylinders @ $ 30.00 / each
$ 9.00
$ 180.00
$ 27,000.00
Gas : - Compaction Equipment & Vehicle - Total : 12 Gallons @ $ 4.25 / gallon
$ 2.55
$ 51.00
$ 7,650.00
Subtotal Expenses
$ 19.05
$ 381.00
$ 57,150.00
LABOR
2 Man Crew x $ 17.50 / Hr . each x 8 Hours
$ 14.00
$ 280.00
$ 42,000.00
DEPRECIATION :
IR / Hotbox = $ 35,000.00
$ 6.25
$ 125.00
$ 18,750.00
Vehicle = $ 50,000.00 Compactor and Tools = $ 5,500.00 Subtotal ( Over 5 Years ) = $ 93,750.00
INSURANCE
Workers Comp , General Liability , Vehicle
$ 12.50
$ 250.00
$ 37,500.00
MISC .
Breaks , Tools , Maintenance
$ 2.50
$ 50.00
$ 7,500.00
Subtotal Overhead
$ 35.25
$ 705.00
$ 105,750.00
Total Cost
Expenses + Overhead
$ 54.30
$ 1,086.00
$ 162,900.00
PROFIT
$ 3,400.00 in Revenue Less
$ 115.70
$ 2,314.00
$ 347,100.00
$ 381.00 in Job Expenses and $ 700.66 in Overhead
Based on the chart above the profit margins work out to about 68 %, which for an industry where most contractors are happy to clear 20 % margins is remarkable . Also keep in mind that this chart includes 2 major variables that could raise those margins even higher . The chart accounts for 20 heats per day which works out to 2.5 heats per hour , which is about average , but assuming a single infrared repair should only take 15-20 minutes that number of repairs per day could easily be increased to 24-30 . Secondly the
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