What it is:
A day rate is the daily cost of a good, service or operating a business.
How it works (Example):
Let's say that John Doe is a consultant to media companies. He charges $200 an hour, making his day rate (8$200) = $1,600.
In the oil business, a day rate is the daily cost of drilling for oil. It includes the cost of the rig, as well as the pay to the people operating the rig and the supplies needed to run the rig.
Why it Matters:
Day rates are a way to calculate the cost of an intermittent or third-party service. They are important parts of calculating operating costs.