Free Tool
Job Profit Calculator
Enter the price, materials, days and labour cost to see the profit, the margin, and the number that matters most: what the job actually paid you per day.
What the customer is paying for the job.
What you actually paid the merchant, before any markup.
Include setting up, clearing away and any return visit.
What the day costs you. Your own target day rate, or what you pay a subbie.
Skip hire, plant, parking, congestion charge, certificates, notifications.
The Number Most Trades Never Work Out
Almost every trade business knows its turnover and very few know which jobs made money. Turnover tells you how busy you were. It says nothing about whether being busy was worth it.
The figure at the bottom of this calculator, what the job paid you per day, is the one worth paying attention to. Take the price, strip out materials and other costs, divide by the days you were actually on it. That is your real day rate for that job, and it is often nothing like the day rate you think you charge.
Count the Days Honestly
The most common reason a job looks profitable on paper and feels awful in reality is an undercounted day.
Include the morning spent loading and driving. Include the afternoon you went back because a part was wrong. Include the hour on the phone explaining the invoice, and the trip to the merchant that was not planned. None of those are billed and all of them are days out of your year.
A job quoted at three days that took four and a half has not made 33% less than you thought. Once materials are out of it, it has often made half.
Margin Versus Markup
- Markup is profit as a percentage of what it cost you. Add 25% to a £100 cost and you sell at £125.
- Margin is profit as a percentage of what you sold it for. That same £125 sale carries a 20% margin, not 25%.
Confusing the two is how trades quietly undercharge. A business that thinks it is running a 30% margin because it adds 30% to cost is actually running 23%, and on tight jobs that gap is the whole profit.
What a Healthy Margin Looks Like
There is no single right answer, because it depends on how much of the job is materials and how much risk you are carrying. As a rough guide, most trade businesses aim for a gross margin of 20% to 40% on a job once materials and direct labour are out.
Materials heavy work sits at the lower end, because you are carrying more cost and adding less of your own value. Labour heavy work should sit higher, because there is very little to hide behind if the days run over.
What matters more than hitting a particular number is knowing which of your job types sits where. Almost every trade business has one it has been losing money on for years without realising, usually the small quick one that always needs a second visit.
Using This Before the Job, Not Just After
- Run your quote through it before you send it. If the effective day rate comes out below your target, the price is wrong, not the job.
- Run it again when the job finishes, using the real days and the real materials. The gap between the two is your estimating error, and it is usually consistent.
- Do that for ten jobs and you will know your own multiplier. Plenty of trades find they should add 20% to every day estimate they make.
- Check the job types separately. An average across everything hides the one that is bleeding.
Frequently Asked Questions
How do I work out if a job made a profit?
Take the price excluding VAT, then subtract materials at cost, labour at what the days actually cost you, and any other direct costs such as skips, plant, parking or certificates. What is left is the gross profit on that job. Divide it by the price to get the margin.
What is a good profit margin for a trade job?
Most trade businesses aim for a gross margin of 20% to 40% once materials and direct labour are out. Materials heavy jobs sit lower because you are carrying more cost and adding less of your own value. Labour heavy jobs should sit higher because there is nothing to absorb an overrun.
What is the difference between markup and margin?
Markup is profit as a percentage of cost, margin is profit as a percentage of the selling price. Adding 25% to a £100 cost gives a £125 price, which is a 25% markup but only a 20% margin. Mixing them up is one of the most common ways trades undercharge without noticing.
Should I include my own time as a cost?
Yes, always. If you do not cost your own labour, every job looks profitable and you have no way of telling a good one from a bad one. Use your target day rate as the cost of your own day, then the profit figure tells you whether the job paid you properly on top of paying you at all.
What is an effective day rate?
It is what the job actually paid you per day once materials and other costs are stripped out: price less materials less other costs, divided by the days you spent on it. Compare it with the day rate you believe you charge. On overrunning jobs the two are often very far apart.
Do this automatically, on every job
Traddie tracks labour and materials against the quote as the job runs, so you can see profit per job without opening a spreadsheet or doing any of this by hand.
Try Traddie free