How long is a realistic ramp?

For an experienced tech joining an established operation, four to eight weeks to full productivity is common — mostly learning your systems, your customers and your trucks. For an apprentice or a career changer it is measured in quarters, not weeks, and the calculation is completely different because you are buying future capacity rather than present capacity.

Should I use gross margin or revenue?

Gross margin. A tech billing $20,000 a month at a 45% gross margin contributes $9,000 towards their cost and your overhead, not $20,000. Using revenue makes every hire look affordable and is the most common way this arithmetic goes wrong.

What about hiring a subcontractor instead?

It removes the ramp risk and the fixed cost, and it costs more per hour and gives you less control over scheduling. The 1099 vs W-2 calculator on this site compares the two on cost — but remember classification is decided by law and the facts of the relationship, not by which is cheaper.

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Can you afford another tech?

A new tech costs money for months before they make any. The question is not whether they will pay for themselves eventually — it is whether you can fund the gap.

Method reviewed by Darren Lim, US CPALicence CPA.74253602

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Cash you need before they pay for themselves

$12,894

Setup plus the ramp. After that they contribute $3,986 a month, so it comes back in about 4 months.

Wage$62,400

Burden32% on top$19,968

Truck, tools, phone$10,200

Total cost per year$92,568

Per month$7,714

They billat 45% gross margin$26,000/mo

Which contributes$11,700/mo

Monthly surplus$3,986/mo

They must bill at leastjust to cover themselves$17,142/mo

Ramp: 6 weeks at 45%Full cost, partial revenue. This is the part that sinks hires.$3,394

One-off setup$9,500

Cash needed on day one$12,894

If the ramp runs twice as longThe most common way this goes wrong is a slower ramp, not a worse tech$16,287

A 5-point lower gross margin meansWhich is why guessing the margin high is the expensive error here$19,285/mo billing needed

Three costs, and only one is the wage

The person. Wage plus payroll tax, workers comp, benefits and paid time off — commonly forty to seventy percent above the wage once it is all counted.

The kit. A truck or van, stock on board, tools, a phone, uniforms, and a licence or certification if the work needs one. Some of it is one-off and some is monthly, and both belong in the first-year number.

The ramp. The weeks before they are producing at full rate, during which you are paying everything above and billing a fraction of it. This is the cost that sinks hires, and it is the one nobody budgets for.

The ramp is the whole risk

A tech at half productivity for two months is not half a problem — it is two months of full cost against partial revenue, arriving before any of the upside does. Multiply the monthly shortfall by the ramp length and that is the cash you need available on the day you hire, not the day they become profitable.

It is also why hiring into a busy season works and hiring into a slow one does not. The same hire, the same person, the same rate, and a completely different outcome — because the ramp lands on top of a period that was already tight.

The question that comes before the money

Is there actually work for them? A new tech only produces if there is demand to fill their days. If your existing crew is running at eighty percent, a new hire mostly dilutes the schedule rather than adding to it, and the hire is really a bet on marketing rather than on capacity.

The honest test: how many jobs did you turn away, delay past a customer’s patience, or lose to a competitor on availability in the last ninety days? If you cannot answer that, that is the thing to measure before hiring — it is cheaper than finding out afterwards.

Common questions

How long is a realistic ramp?: For an experienced tech joining an established operation, four to eight weeks to full productivity is common — mostly learning your systems, your customers and your trucks. For an apprentice or a career changer it is measured in quarters, not weeks, and the calculation is completely different because you are buying future capacity rather than present capacity.
Should I use gross margin or revenue?: Gross margin. A tech billing $20,000 a month at a 45% gross margin contributes $9,000 towards their cost and your overhead, not $20,000. Using revenue makes every hire look affordable and is the most common way this arithmetic goes wrong.
What about hiring a subcontractor instead?: It removes the ramp risk and the fixed cost, and it costs more per hour and gives you less control over scheduling. The 1099 vs W-2 calculator on this site compares the two on cost — but remember classification is decided by law and the facts of the relationship, not by which is cheaper.

What we do about it

Revenue and gross margin tracked per tech from the month they start, so you can see the ramp actually closing rather than waiting until year end to find out whether the hire worked.