The Ultimate Guide to Pricing Jobs for Profit

Underquoting is an epidemic in the trades. Most tradies aren't bad at their craft — they're bad at pricing it. This guide will fix that.

Know Your True Costs

Before you quote a single job, you need to know:

• Your hourly labour cost (including super, insurance, and leave)
• Material costs with markup
• Vehicle and equipment costs per hour
• Overhead allocation (rent, tools, software, phones)

Most tradies guess. The top performers know their numbers to the cent.

The Formula

Profit = (Price - True Cost) × Volume

If your price is too low, you need unhealthy volume to make money. If your price is right, you can be selective about jobs and still grow.

Markup vs Margin

• Markup: add 30% to cost → you get 23% margin
• Margin: you want 30% margin → mark up cost by 43%

Know the difference. Use margin, not markup, when planning.

Value-Based Pricing

Some jobs have higher value to the customer than others. An emergency weekend callout? Premium pricing. A complex commercial job with tight deadlines? Premium pricing. Don't charge the same rate for everything.

The "Win Rate" Test

If you're winning more than 70% of quotes, you're too cheap. If you're winning less than 30%, you're too expensive or your sales process needs work. The sweet spot is 40-60%.

Raising Prices

The best time to raise prices is when you're busy. Customers expect it, and the fear of losing work is lower. A 10% price increase on $500k revenue is $50k extra profit — with zero extra work.