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 underpricing.
This is one of the biggest reasons tradesmen stay busy but don’t make money — something explained in Why Most Tradesmen Undercharge for Jobs
Pricing a job properly means breaking it down so every cost is covered and you still make a profit.
Here’s a simple 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 only think about best-case scenarios — but jobs rarely go perfectly.
You need to factor in:
- Setup time
- Travel
- Material collection
- Unexpected problems
- Clean-up
- Customer discussions
On most jobs, the biggest loss comes from underestimating labour time.
If you think it will take 1 day, it might actually take 1.5 days.
A good rule: add 20–30% to your initial estimate.
Step 2: Calculate Your Labour Cost
Now multiply your time by your actual day rate.
Example:
- Day rate: £250
- Time: 2 days
Labour = £500
This is your minimum labour cost before materials or profit.
If you don’t know your correct day rate yet, start with How to Calculate Your Day Rate as a Self-Employed Tradesman
Step 3: Add the Materials
Materials should never come out of your labour.
Always price them separately.
Include:
- Materials
- Delivery
- Collection time
- Waste allowance
Example:
- Materials: £120
- Consumables: £30
- Delivery: £20
Total = £170
Many tradesmen also apply a 10–20% markup.
Step 4: Include Overheads
This is where many tradesmen lose money.
Running a business costs money — even when you’re not working.
These costs include:
- Van fuel
- Maintenance
- Insurance
- Tools
- Accountant
- Phone
- Advertising
These are already built into your day rate, but when jobs overrun, they eat into your profit.
This is why having the right rate in the first place matters — explained in Tradesman Day Rates UK: What You Should Really Be Charging
Step 5: Add Profit
Profit is not wages.
Your labour pays your wage.
Profit is what makes your business worth running.
Without profit, you can’t:
- Replace tools
- Grow the business
- Take time off
- Handle problems
A simple approach:
Add 10–20% profit
Example:
- Labour: £500
- Materials: £170
- Total: £670
Add 15% profit:
Final price = £770
Step 6: Round the Price Properly
Avoid awkward figures like:
£768.42
Instead:
£770 or £780
Clean numbers look more professional and intentional.
Step 7: Be Confident With Your Price
This is where many tradesmen undo all their good work.
They say things like:
- “I know it’s a bit expensive…”
- “I can knock something off…”
This kills confidence in your price.
Instead:
Present it clearly and confidently
Customers don’t always choose the cheapest — they choose the most professional.
A Simple Job Pricing Example
Let’s run it through:
- Time: 1.5 days
- Day rate: £250
Labour:
£375
Materials:
£120
Subtotal:
£495
Add 15% profit:
£569
Final price:
£570
Now the job is properly priced and profitable.
The Key Rule: Never Guess
The biggest mistake tradesmen make is simple:
They guess.
Guessing leads to:
- Long days for little money
- Jobs dragging on
- Constant financial pressure
It’s also one of the main causes of cash flow problems — explained in Why Most Tradesmen Struggle With Cash Flow (Even When Busy)
Final Thoughts
Being busy is not the goal.
Being profitable is.
Proper pricing means every job contributes to:
- Your income
- Your business
- Your future
If you consistently lose money on jobs, the problem usually isn’t the work —
It’s the price.
“I’ve built a simple calculator to fix this — you can get it here.”
Leave a Reply