Job Costing Calculator UK

How the price is built

In two passes. First what the job costs you — labour, everything you buy in, a share of your overheads, and something held back for the jobs that overrun. Then what to charge, worked out two different ways, taking whichever is higher.

What each input means

Labour rows

One per person or role, in hours or days. Two rates each: what the time costs you all-in — wage, employer National Insurance, holiday, the lot — and what you charge the customer for it. Leave the charge rate blank and the calculator uses your cost, which is what you want when labour is bundled into a fixed price.

Cost rows

Materials, subcontractors, plant hire, travel, waste, and anything else the job spends money on. Enter what it costs you excluding VAT. The markup on each row is what you add when charging it on — 20% on materials is common, and 0% on a skip is equally valid.

Overhead recovery

Your share of the costs no single job pays for. Three ways to carry it: per labour hour, as a percentage of what the job costs, or a flat amount. Per labour hour is usually the most honest, because most overhead is a function of time rather than of spend.

Contingency

A percentage held back for the jobs that overrun. Taken on labour and costs only, not on overhead — a job overruns on work, not on your insurance premium.

Target gross margin

The margin the business needs to run on. A floor for the price, not an extra markup.

Discount

Applied last, after the price is set, as a percentage or an amount. Last on purpose: it is the only way to see what the discount actually costs you, and to be told when it takes the job below what it costs to deliver.

VAT and deposit

VAT goes on the discounted price and is shown separately — it is never part of what the job earns. The deposit is a share of the VAT-inclusive total, because that is the figure the customer pays.

A worked example

The figures the calculator opens with — a two-person electrical job, so you can follow them on screen.

1. 1.An electrician for 16 hours at £22 an hour and a mate for 8 at £14: £464 of labour, 24 hours on site.
2. 2.£480 of materials at 20% markup, £75 of tower scaffold and a £90 skip at cost: £645 spent, £741 charged on.
3. 3.Direct cost is £1,109. Overhead recovers at £12 per labour hour, so 24 hours carries £288.
4. 4.5% contingency on the direct cost adds £55.45, making the job cost £1,452.45 all in.
5. 5.Priced from your rates: £944 of labour plus £741 of materials and hire, plus overhead and contingency — £2,028.45.
6. 6.Priced to a 30% target margin: £1,452.45 ÷ 0.7 = £2,074.93.

£2,074.93 wins, because your charge-out rates alone would have left you at 28.4% — just under the target. That is the floor doing its job. The quote earns £622.48 of gross profit at exactly 30%, a 42.9% markup on cost, and £25.94 for every labour hour on site. Take 10% off as a discount and the profit falls to £415, or 22.2% — which is the number worth looking at before you offer it.

Where this stops

• —It prices a job before you quote it. What the job actually made needs the figures from after it finished, which is a different calculation.
• —Gross margin on a job is not your company's net profit. That also carries the overheads no job was charged for, finance costs and tax.
• —Every figure goes in excluding VAT. If you are registered, VAT on materials is reclaimable, so including it would overstate what the job costs you.
• —It assumes the job is invoiced and paid in full. Retentions, staged payments and bad debt all come off this.
• —Overhead recovery is only as good as the rate you feed it — work it out from last year's accounts rather than guessing.

Where to go next

The price is one step. These pick up either side of it.

• →Hourly rate calculator — work out the charge-out rate this uses
• →Markup vs margin — the conversion that trips people up on materials
• →Quote generator — put the price in front of the customer
• →Quoting in Cushty — price and send without retyping any of it