How to price a job as a contractor: free quote template
6-minute read
How to estimate the cost of a job as a contractor depends on a few key factors, whatever your trade or line of work.
The key is experience, so here’s a guide to pricing up jobs, plus a free quote template.
Why price quotes are crucial for your business
It doesn’t matter what trade you’re in, how to quote for a job is a fundamental part of running your business.
Potential customers these days are likely to be time-poor and markets tend to be demand-driven. Prospective customers will want to know right away how much their dream extension or emergency plumbing work is going to cost.
Ideally, you’ll be able to take an enquiry and then price a job within a day or two, and if it’s a bigger job, try to visit the customer and discuss an initial project outline.
They’ll still want an estimate and a follow-up pricing quote, but running through a project in person establishes trust and allows you to see what shape the project will take and its potential risk factors.
Below are the basics you need to plan for when working out how to quote a price for a job.
Pricing up jobs – know what you’re up against when bidding for work
From market conditions and materials prices to your local competitor rates, it pays to understand what can affect your costs.
Market conditions
First, you need to look at the economy in general, and whether there are widespread issues that could affect your customers’ budgets and appetite. For example, the cost of living crisis means customers could get more price quotes than usual as they’ll be looking for the best possible deals.
Second, it’s important to understand whether there’s anything impacting your specific trade or market that could drive your prices up or down, such as:
- tax
- import duties
- materials shortages
- employment law
- regulation changes
Check that your website, brochures, and other marketing materials are up to date, with any new prices added – there’s nothing worse for a customer than reading a guide price, only to see it shoot up when you quote the price of the contract.
Price of resources
Make sure you’re up to speed with the latest on the materials, parts, and labour you’re working with. Doing a full inventory every few months is a good idea, so that you know where the peaks and dips in costs may lie further down the line.
There have been a range of issues impacting the price of resources in recent years, from Brexit and Covid-19 to the war in Ukraine and the cost of living crisis.
The price of resources, availability of labour, and reliability of supply chains have all fluctuated during this period.
Competitor rates
While you may be aware of who your competitors are and what they do, do you know what they’re charging customers, and whether this is above or under what you’re offering?
People may have a rough outline of costs on their website or printed materials, but that really just gives you a guideline.
You might not want to ask people outright what they’re charging, but check in with friends and family on the quotes they’re getting.
Check online review sites and social media for discussions about price. Build a relationship with your suppliers and ask about any trends they’re seeing, or drop-offs in orders.
Assess the location
There are three crucial things to think about when considering the premises or site for the job:
- access
- proximity
- conditions
For example, if you’re working out how to price a decorating job and the customer is a couple of streets away from you, easily accessible through a ground floor front door and conditions aren’t a problem, you won’t need to factor much into your costs.
On the other hand, if you’re looking at how to price a job in construction and the site is an hour’s drive away, down a narrow rough track, and the conditions are challenging, you may need to reflect these things in your costs.
Itemise the materials you need
The key part of most cost plans and quotes rests on your resources. What do you need to get the job done? This isn’t just about paint, sand, tools, and stock. It’s also about your staff – do you need to take on an extra pair of hands? Bear in mind that if you do need to employ someone, you’ll need to factor in their pay and things like employers’ liability insurance.
As soon as you’re confident about the brief or job from your customer, draw up a full list of everything you’re going to need to complete it, and the cost to you.
Use this to create your quote, marking up and down where sensible and remembering to add on a percentage cost for waste and your service (see below for a basic cost structure example when working out how to quote for a job).
Experience is golden
There’s nothing like working out how to price up a job for the first time.
Learning as much as possible from each project is what will give you the most accurate, attractive, and profitable quotes in the business.
So note learnings as you go and learn what to watch for, which suppliers to trust, and where to draw your boundaries – it’s better to say no to a job than take on a project that turns out to be more trouble than it’s worth.
How to price a job as a contractor: example of a quote
This basic cost structure is designed to help you work out your first draft. You’ll need to add to it and take specific advice from an accountant though, depending on your trade and market.
Hourly rate x hours estimate
+ cost of materials (with waste/service percentage) + % for overheads (business insurance, transport costs, etc)
Example
£12.07/hour x 28 hours
+ £150 in materials
- £15 waste/service percentage (10% of materials cost)
- £40 overheads
£542.96 = total cost
Sense-checked quote = £540.00
Once you’re happy, build in a margin for things to go wrong, and provide a schedule for your customer so that they know the plan for the project and when they can expect certain milestones to be completed.
How to price a painting job: 5 top tips
- clarify with the customer any areas that don’t need painting (such as doors and windows)
- expect your customer to change their mind, even if they’ve seen a sample
- talk to your customer about paint brand and quality when pricing a painting and decorating job
- who will be removing the furniture? Remember to factor this in or out
- agree up-front who will be buying the paint, as this will affect your costs
For more information, check out our article on how to become a painter and decorator in the UK.
How to price up a plastering job: 5 top tips
- work out all the elements that don’t need plastering
- will you need to remove any existing plastering?
- check the site’s access points before quoting
- include sheeting up and cleaning in your estimate
- base your cost on all furniture being removed before you start, and increase if necessary
How to write a quote for a building job: 5 top tips
- arrange a ‘walk-through’ of the site before you provide any quote or estimate for a building job
- ask for any mock-ups or drawings that the client has already
- get a clear picture of any subcontractors you’re going to need
- try to deliver the quote in person and walk through each aspect with your customer
- make sure you’re on top of any issues surrounding supply chains and materials
How to price a renovation job: 5 top tips
- allow for delays and, if in doubt, extend your timings estimate
- get damage limitation plans in place to protect the rest of the property
- investigate all travel, parking, and access issues ahead of quoting
- ask whether the property will be occupied throughout the project, and whether daily clean-ups will be needed
- let your customer know about any extra costs you anticipate as early as possible
How to price a plumbing job: 5 top tips
- arrange to see the site and get to know the project before you provide a plumbing quote
- charge a bit more for emergency call-outs, or if you haven’t seen the property before
- be clear that the job may take longer, depending on what you find
- factor in all access issues and clean-up time
- itemise your materials costs and explain these to your customer
How to price an electrical job: 5 top tips
- are any other contractors working on the site? Factor in delay time for these
- be clear about the hours you’ll be working, and explain them to your customer
- run through your quote in person with the customer, answering any questions and putting them at ease
- pay attention to the detail in your quote, from screws and grommets to finish options
- keep a list of everything you use in a job, add to it over time, and use it as a draft checklist for future projects
Check out our guide to becoming a self-employed electrician in the UK, plus information on insurance for electricians and electrical contractors.
Useful guides and resources for contractors
What are your top tips for pricing a job as a contractor? Let us know in the comments below.
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Written by
Conor Shilling
Conor Shilling is a Copywriter at Simply Business with over two years’ experience in the insurance industry. A trained journalist, Conor has worked as a professional writer for 10 years. His previous experience includes writing for several leading online property trade publications. Conor specialises in the buy-to-let market, landlords, and small business finance.
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