Re: Consultant Fees Gregory K. Schmidt 09 Jun 2012 10:14 EST
I hear you. Then you run into silly consultant caps on fed awards. SAMHSA has $500 a day (up from $450). $62.50 an hour is third rate. So you end up playing games; instead of T&E, it's FP, and instead of 5 days work, it's 10 days plus expenses. Silly "J. Michael Slocum" <xxxxxx@GMAIL.COM> wrote: >That is the point. The "employed" don't begin to understand the costs of >doing business. What seems like a quite reasonable sum is really barely >enough to cover the costs of being in business. >As a practicing attorney for the past 30+ years, I know the costs of >operating only too well. >The costs of an employee are also not understood. Overhead and fringe >needs to be applied first, then the costs of non-productive time have to be >factored in for even a low-paid employee without the specialized skills >needed from the consultant. > >On Sat, Jun 9, 2012 at 2:11 AM, Gregory K. Schmidt <xxxxxx@verizon.net>wrote: > >> First, my time costs when I travel. Maybe not at full rate, but I charge. >> There is an opportunity cost. >> >> Second, you assume that I work 40 hrs a week billable. Not always the >> case. >> >> Next, the administration, marketing, networking, email time is taken at >> night or on weekends, or if there is no billable time during normal working >> hours. >> >> I have never worked a 40 hour week as a consultant. Jobs are often capped >> or fixed price (rate sheets). >> >> Costs of insurance (liability ins. can be a killer), health, auto, >> memberships,equipment, software, supplies, rents, fed, state, city taxes, >> licenses, rents, legal and accounting fees......... everyone has their >> hands in my pocket. >> >> Profit? The charge rate is so diluted with hours worked that I'll earn >> about what I did 15-20 yrs ago when I worked for the state. That would be >> south of next to nothing. >> >> >> >> "J. Michael Slocum" <xxxxxx@GMAIL.COM> wrote: >> >> >CONSULTANT "COSTS" TO OPERATE >> > >> > >> >• Take the $1600/Wk and the 40hrs/Wk >> > >> >• Deduct 1.5 hrs for travelling per day between clients etc. >> > >> >• = 7.5 hrs/Wk >> > >> >• Deduct 1 hr per day for admin and paperwork >> > >> >• = 5hrs/Wk >> > >> >• Deduct 10 hrs/Wk for marketing, networking etc. >> > >> >• = a total of 22.5 hours/Wk >> > >> >• Thus 40-22.5=17.5 >> > >> >• Lets assume that a consultant has the ability to work 80% of the >> >available hours every week of the year…………… >> > >> >• This would the equate to 14 hrs/Wk >> > >> >• 14 x 40 = $560/wk or $2426/Mth >> > >> >• From your current earnings of $6900 to $2426 per month >> > >> >• Reality –$113.75/hr CHARGED TO CLIENT to equal an income of >> >$6900.00/month >> > >> >GROSS INCOME TO CONSULTANT IS $82,800 >> > >> >*NET IS LESS THAN $70k PER YEAR* AFTER SELF-EMPLOYMENT TAXES AND *NO COSTS >> >OF BUSINESS HAVE BEEN RECOVERED* >> > >> >On Fri, Jun 8, 2012 at 8:54 PM, Gregory K. Schmidt <xxxxxx@verizon.net >> >wrote: >> > >> >> A consultant fee is no different than salaries in concept. A consultant >> >> provides intellectual services specialized such that your institution >> would >> >> not normally retain on full time payroll. Ask him if his paycheck is >> >> profit to him. >> >> >> >> Gloria Greene <xxxxxx@UAH.EDU> wrote: >> >> >> >> >I have a dilemma and need some help/clarification with a situation. >> >> > >> >> > >> >> > >> >> >My CFO believes that a consultant’s fee is “profit.” I disagree with >> him. >> >> >I believe that a fee for services is not a profit, and should therefore >> >> not >> >> >be classified as profit. His position is a consultant and vendor are >> one >> >> >in the same and therefore any money made is “a profit.” >> >> > >> >> > >> >> > >> >> >I told him that comparing a vendor to a consultant are the same as >> >> >comparing apples and oranges. They are not the same. The consultant >> >> >provides a services the vendor provides a commodity (item, materials, >> >> >etc). These are not the same. >> >> > >> >> > >> >> > >> >> >Can someone help me! If I am wrong, then please let me know that as >> well. >> >> >I view help as setting me straight and educating me. If you can >> provide >> >> me >> >> >with any written guidance on this matter to further make my case that >> will >> >> >be welcomed as well. >> >> > >> >> > >> >> > >> >> >I appreciate this group and its insight. >> >> > >> >> > >> >> > >> >> >Regards >> >> > >> >> > >> >> > >> >> >*Gloria Greene, MA, CRA* >> >> > >> >> >Director >> >> > >> >> >UAHuntsville, Office of Sponsored Programs >> >> > >> >> >SRA-Alabama Chapter, *Vice President-Elect* >> >> > >> >> >301 Sparkman Drive, VBRH E26 >> >> > >> >> >Huntsville, AL 35899 >> >> > >> >> >Voice: (256) 824-2657 >> >> > >> >> >Fax: (256) 824-6677 >> >> > >> >> >Email: xxxxxx@uah.edu >> >> > >> >> > >> >> > >> >> >*"The person who knows 'how' will always have a job. The person who >> knows >> >> >'why' will always be his boss." -- Diane Ravitch* >> >> > >> >> > >> >> > >> >> >*Please do not print this email unless necessary.* >> >> >*Take Charge,* *Go GREEN!* >> >> > >> >> >[image: yep] >> >> > >> >> > >> >> >====================================================================== >> >> > Instructions on how to use the RESADM-L Mailing List, including >> >> > subscription information and a web-searchable archive, are available >> >> > via our web site at http://www.healthresearch.org (click on the >> >> > "LISTSERV" link in the upper right corner) >> >> > >> >> > A link directly to helpful tips: http://tinyurl.com/resadm-l-help >> >> >====================================================================== >> >> >> >> >> >> ====================================================================== >> >> Instructions on how to use the RESADM-L Mailing List, including >> >> subscription information and a web-searchable archive, are available >> >> via our web site at http://www.healthresearch.org (click on the >> >> "LISTSERV" link in the upper right corner) >> >> >> >> A link directly to helpful tips: http://tinyurl.com/resadm-l-help >> >> ====================================================================== >> >> >> > >> > >> >====================================================================== >> > Instructions on how to use the RESADM-L Mailing List, including >> > subscription information and a web-searchable archive, are available >> > via our web site at http://www.healthresearch.org (click on the >> > "LISTSERV" link in the upper right corner) >> > >> > A link directly to helpful tips: http://tinyurl.com/resadm-l-help >> >====================================================================== >> >> >> ====================================================================== >> Instructions on how to use the RESADM-L Mailing List, including >> subscription information and a web-searchable archive, are available >> via our web site at http://www.healthresearch.org (click on the >> "LISTSERV" link in the upper right corner) >> >> A link directly to helpful tips: http://tinyurl.com/resadm-l-help >> ====================================================================== >> > > >====================================================================== > Instructions on how to use the RESADM-L Mailing List, including > subscription information and a web-searchable archive, are available > via our web site at http://www.healthresearch.org (click on the > "LISTSERV" link in the upper right corner) > > A link directly to helpful tips: http://tinyurl.com/resadm-l-help >====================================================================== ====================================================================== Instructions on how to use the RESADM-L Mailing List, including subscription information and a web-searchable archive, are available via our web site at http://www.healthresearch.org (click on the "LISTSERV" link in the upper right corner) A link directly to helpful tips: http://tinyurl.com/resadm-l-help ======================================================================