Decorative Gravel

The numbers this sheet uses

These are mine, measured on my own jobs in Central Texas. Your rock might be $120, might be $190. Use your number. Two weights to carry around with the prices, because they explain the rest of the page: a yard of hardwood mulch is about 500 pounds, and a yard of this rock is about 2,700. Say about, because it moves with moisture and stone size. Fabric, edge restraint, base prep and the over-order are not in this number. They are separate lines, and they should be.

Sell price to the customer

$275 a cubic yard, installed

What the rock costs

$150 a cubic yard, delivered

What the crew is paid

$23 an hour, average

The burden

1.35

What an hour of labor costs

$31, the wage times the burden

The ceiling

Divide the rock by the price before anybody picks up a shovel. The $150 over the $275 is 54.5%. Your rock is 55% of what you charge. On hardwood mulch it is about a third. One minus that is 45.5%, which is $125 a yard, and that is the most gross profit that exists on a yard of Texas Black. That is if the rock spreads itself. So if your target on this is 50%, it does not exist. Not at $275. Not at any speed.

The three columns on this sheet start higher than the mulch sheet did, because that is where people think gravel lives: 30%, 35% and 40%. At 30%, $82.50 of gross profit, $192.50 of allowable cost, and $42.50 left for labor. That is 1.37 man-hours a yard. At 35%, $96.25, $178.75, $28.75 for labor, 0.93 man-hours. At 40%, $110 of gross profit, $165 allowable, and $15 is the entire labor budget for a yard. That is 0.48 man-hours. Twenty-nine minutes.

One person, 29 minutes, to move a cubic yard of black star from the pile to the bed and rake it out. A yard of it is about 2,700 pounds. So in 29 minutes, one person is moving better than a ton and a quarter by hand and finishing it. That is not a stretch goal. That is not a hustle problem. That number is not real. The 1.37, an hour and 20 minutes a yard, is real. And an hour and 20 minutes a yard is 30% gross profit, not 40.

Rock is 55% of the price. 45% is the most that exists, and 50% was never on the table.

The real pace

Forget what you want to make. What happens when a crew of 2 spreads black star with wheelbarrows, normal residential access, a walk from the driveway to the bed, is 1.75 man-hours a yard. That is our number. The trade puts hand-spread gravel anywhere from an hour to two a yard, so it is the top of the range, and it is the one I would bid.

Run it down. The 1.75 man-hours at $31 is $54.25 of labor. Add the $150 of rock and the yard costs $204.25. The $275 price minus $204.25 is $70.75 of gross profit, which is 25.7%. Look where that lands. It is not the 40% column. It is not the 35% column. It is not even the 30% column. Your actual margin on Texas Black falls off the bottom of your own table. And to make 35% at 1.75 man-hours, the $204.25 divided by 0.65 is $314 a yard. Not $275.

The crew table turns the pace into a day, the same way it did on mulch and sod. A crew of 2 for 8 hours is 16 man-hours, over 1.75, about 9 yards. A crew of 3 is 24 man-hours, 13.5 yards. A crew of 4, 18. A crew of 5, 23 on paper, and read the footnote first. Everybody queues at one pile. On gravel that is worse than anything else you install, because the pile is the bottleneck and the barrow is heavy. The fifth person is not spreading. They are waiting their turn at the same shovel.

Run it backward. A crew of 3 comes home with 10 yards instead of 13.5. The 24 man-hours over 10 yards is 2.4 man-hours a yard, which is $74.40 of labor on a yard you budgeted at $54.25. Gross profit is $50.60, and that is 18%. The price never moved. On gravel, that happens on the first hot day with a long carry.

You priced it for 35%. A real crew with wheelbarrows runs 1.75 man-hours a yard, and that is 26%, off the bottom of your own table.

Which lever pays, and the machine

The grid on sheet 3 has the price per yard across the top, the man-hours per yard down the side, and the gross margin in every cell, with $150 of rock and a $31 hour throughout. The circle at $275 and 1.75 is 26% and $70.75. Get the crew 10% faster, 1.75 down to 1.58, and you climb one row to 28% and $76.17. That is $5.42 a yard. Charge 9% more, $300 a yard, and you move one column across to 32% and $95.75. That is $25 a yard. Price beats speed about 5 to 1 on aggregate. To match a 10% raise on speed alone, the crew would have to get about 50% faster.

Now, 50% sounds impossible, and on the materials before this one it is. On this one it is not, and here is why. Your constraint on gravel is not the person. It is the wheelbarrow. You are moving 2,700 pounds a yard in a container that holds about 2 cubic feet of it. That is a material handling problem, and material handling problems get solved with equipment, not encouragement. A power buggy. A skid steer with a bucket. A conveyor on the right site. Any of them can plausibly halve the haul time. This is the first material in the series where buying a machine is the honest answer instead of pushing the crew.

Just do not do both. If you rent the buggy, your man-hours already came down. Charge for the machine or charge for the hours, not both. And look at what is underneath you on the grid. Somebody quotes $225 a yard to win the job. Same rock, same crew, same everything. The 1.75 row at $225 reads 9%, before anybody gets paid overhead. Fifty dollars off your price costs you 17 points, and no machine on earth gives that back.

The constraint on gravel is the barrow, not the person. Material handling problems get solved with equipment, not encouragement.

Job size and the over-order

Two things the sheet cannot show you, and both cost you money on gravel. First, job size. Three yards in a front bed and 20 yards across a whole property are not the same job per yard. Pulling up, tarping the drive, staging the pile, edging, blowing off, loading out: that is the same hour and a half whether you brought 3 yards or 30. On 30 yards it disappears. On 3 yards you just ate the job. That is what a minimum charge is for.

Second, and this one is specific to rock. Aggregate settles and compacts. If you are ordering 10% over to cover it, and you should be, that is $15 a yard of material you are eating unless it is on the quote. On a 20-yard job that is $300 you gave away. Put the over-order on the quote as a line, with the fabric, the edge restraint and the base prep. None of them is in the $275, and a quote that pretends they are is paying for them out of the $70.75.

Where it goes wrong on your job

The 1.75 was measured with wheelbarrows and normal access, and nothing about your site is in it. These are the days that miss it. The pile got dropped at the street and the beds are behind the house, and 13 trips a yard became 13 long ones. It was August and the crew slowed down the way anybody does pushing a loaded barrow up a slope. Five people worked one pile and two of them spent the day waiting. The job was 3 yards and carried the same hour and a half as 30. The rock settled, the crew spread the 10% you ordered over, and the quote only had the 10 yards on it. The fabric and the edge restraint went in because they had to, and nobody wrote a line for them. And the one that costs the most: it was priced like mulch, because it went in like mulch.

One job over budget usually has a story like one of those behind it. Write it down and move on. Five jobs over with no story is your real pace, and then one of three numbers has to move: the price, the pace, or what the rock costs you. On gravel the pace is the one lever where a rental is a real answer. Run the machine on one job and divide the hours again.

What to do with this

Before you price anything by feel, weigh it. Literally. What does a yard of it weigh, and what does a yard of it cost you? Those two numbers tell you almost everything. Then divide the rock by the price for the ceiling, in 10 seconds. Then take the last gravel job you ran, the yards from the invoice and the crew's hours from your foreman, and divide. Find that row on the sheet and read across. If the number surprises you, watch the episode and price the next one with the barrow in mind. If it does not, you have lost 10 minutes.