This article is part of our Pricing & Profit guide for tradesmen, which explains how to charge properly and run a profitable trade business.
One of the biggest differences between tradesmen who make good money and those who constantly struggle is simple:
They price jobs properly.
Many tradesmen price work by gut feeling.
They look at a job and think:
- “That looks like about £400.”
- “I’ll charge £250 and hope it’s done in a day.”
- “The last guy charged £300 so I’ll go a bit cheaper.”
The problem is that guessing almost always leads to under-pricing.
Pricing a job properly means breaking it down so every cost is covered and you still make a profit.
Here’s a simple step-by-step method that works.
Step 1: Estimate the Time Properly
The first question should always be:
How long will this job actually take?
Be realistic.
Many tradesmen underestimate time because they only think about the best-case scenario.
But jobs rarely go perfectly.
Think about:
- Setup time
- Travel time
- Material collection
- Unexpected problems
- Clean-up time
- Customer discussions
On most jobs, the biggest loss comes from underestimating labour time.
If you think a job will take 1 day, it may realistically take 1.5 days.
Always build in a buffer.
A good rule many experienced tradesmen follow:
Take your first estimate and add 20–30%.
Step 2: Calculate Your Labour Cost
Next, multiply the estimated time by your proper day rate.
For example:
If your day rate is:
£250 per day
And the job will take:
2 days
Your labour cost should be:
£500
This is the absolute minimum labour charge before any materials or profit.
If you’re not sure what your day rate should be, refer to:
Pillar 2.1 – How Much Should a Self-Employed Tradesman Charge Per Day in the UK
Step 3: Add the Materials
Materials should never come out of your labour money.
Always calculate them separately.
Include:
- All materials required
- Delivery costs
- Collection time if needed
- Any waste allowance
For example:
| Item | Cost |
| Cable and accessories | £120 |
| Fixings and consumables | £30 |
| Delivery / collection | £20 |
Total materials: £170
Some tradesmen also add 10–20% markup on materials to cover time and handling.
Step 4: Include Overheads
This is where many tradesmen lose money.
Running a business costs money even when you are not working.
Your pricing must cover things like:
- Van fuel
- Van maintenance
- Insurance
- Tools and replacements
- Accounting fees
- Advertising
- Phone bills
These costs are part of your day rate, but when jobs run longer than expected they start eating into your profit.
This is another reason to always include a time buffer in your estimate.
Step 5: Add Profit
Profit is not the same as wages.
Your labour pays your wages.
Profit is what makes your business worth running.
Without profit there is no money for:
- Equipment upgrades
- Growth
- Emergencies
- Time off
A simple way to do this is to add 10–20% profit on top of the total job cost.
Example:
| Cost | Amount |
| Labour | £500 |
| Materials | £170 |
| Total cost | £670 |
Add 15% profit
Final price:
£770
Step 6: Round the Price Properly
Professional quotes rarely look like this:
£768.42
Round your price to something clean and confident:
£770 or £780
Psychologically this looks more professional and deliberate.
Avoid pricing like you’re guessing.
Step 7: Be Confident With Your Price
One of the biggest mistakes tradesmen make is apologising for their price.
They say things like:
- “I know it’s a bit expensive…”
- “I can probably knock a bit off…”
- “Let me know if it’s too much…”
This immediately makes the customer question the value.
Instead, present the quote clearly and confidently.
Customers don’t always choose the cheapest quote.
They choose the tradesman who looks most professional and trustworthy.
A Simple Job Pricing Example
Let’s say you are quoting a small electrical job.
Estimated time: 1.5 days
Your day rate: £250
Labour:
1.5 × £250 = £375
Materials:
£120
Subtotal:
£495
Add 15% profit:
£569
Final quote:
£570
Now the job is priced properly and profitably.
The Key Rule: Never Guess
The biggest mistake tradesmen make when pricing jobs is simple:
They guess.
Guessing leads to:
- Long days for little money
- Jobs that drag on
- Constant financial pressure
Proper pricing means every job contributes to a sustainable business, not just another busy week.
Being busy is good.
Being profitable is better.
If you consistently lose money on jobs, the problem usually isn’t the work — it’s the price.
Useful Links
Calculate Day Rate https://financefortradesmen.wordpress.com/2026/03/09/how-to-calculate-your-day-rate-as-a-self-employed-tradesman/
Quoting Mistakes https://financefortradesmen.wordpress.com/2026/03/09/the-biggest-quoting-mistakes-tradesmen-make/
Hidden Costs https://financefortradesmen.wordpress.com/2026/03/09/the-hidden-costs-of-being-self-employed-in-the-trades/
Written by the founder of Finance for Tradesmen, with over 30 years of experience in the electrical industry.
Finance for Tradesmen 
Leave a comment