Where to next
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Free Consult →What this tool does
The calculator takes one job's revenue, labor hours, wage, burden, materials, subcontractors and equipment. Returns gross profit, gross margin and the effective profit per labor hour.
How to read the result
- Burden is where most job costing goes wrong. Payroll taxes, workers compensation, benefits and paid time usually add 25% to 40% on top of the wage. A job priced off the bare wage is priced at a loss it cannot see.
- Profit per labor hour is the number to compare across jobs. Two jobs at the same margin are not equal if one tied up a crew for three days.
- Run a won job and a lost job through it. The pattern in the losses is almost always one input, usually travel or callbacks.
- The result is a job-level answer. Overhead, office staff and vehicles still have to be covered by the jobs above this line.
Questions we get asked
What labor burden rate should I use?
Take last year's payroll taxes, workers compensation premium, benefits and paid time off, and divide by total wages paid. Most field services businesses land between 25% and 40%. Guessing low is the single most common pricing error in the trades.
Should overhead be in a job cost?
Not in the job cost itself. Keep the job at direct cost, then check that total gross profit across jobs covers overhead. Mixing them hides which jobs actually pay.
Does this replace job costing in the accounting file?
No. It checks one job quickly. Real job costing lives in the chart of accounts, so every job is coded the same way and the report builds itself.
If you want this done for you
What happens next
Reading about it and having it done are different things. Here is exactly what happens if you want the second one.
- The call takes thirty minutesYou describe the business and where the numbers are letting you down. We give you an expert view of your situation, and what we would start with. There is no pitch deck.
- We look at the fileYou give us read access to the books as they are. We come back with what is wrong, what it will take to fix, and whether the answer is bookkeeping, controller work, or something else.
- We send a written scope and a priceIt lists what we do each month, what you get, the date it lands and the fee. We agree it before anything starts, and it does not change unless you agree.
- We take over the books and close the first monthWe set up access and systems and enter the opening balances. The first close lands on the date in the scope, and every one after it does too.