How to price a job as a tradie: the method behind every quote
By Bailey Holdsworth, founder
Last updated · 8 min read
To price a job, start from what it will cost you: materials at today's prices, labour at your true hourly cost, hire, subbies and a contingency for what you cannot see. Then add a margin by dividing the cost, not by adding a percentage, and check the result against what similar jobs have really cost you.
Pricing a job and quoting it are two halves of the same thing. Pricing is working out the number. Quoting is putting that number in writing so the client can say yes. This guide is the first half, for any trade. How to quote a job as a tradie is the second half, with what to put in writing and a free quote template.
If you want the method for your own trade, go straight to it:
- How to quote a carpentry job, with a deck priced line by line
- How to price a landscaping job, by the square and cubic metre, with weather and disposal
- How to price a painting job, from measured surfaces and your own production rates
- How to price a concreting job, from the parts before the square metre rate
- Electricians, plumbers and builders: the pricing section and worked example on each trade page, for electricians, plumbers and builders
The three numbers behind every price
Whatever you charge for, hourly or fixed, by the square metre or by the day, the price is built from the same three numbers.
1. Your true hourly cost
This is what an hour of your time costs the business, not what you pay yourself. Add up a year of wages, super, insurance, the vehicle, tools, phone, software and every other overhead, then divide by the hours you actually bill, not the hours you are at work. Quoting, driving, picking up materials and chasing payments are hours you pay for but cannot bill. The tradie hourly rate calculator does the sum, and its worked examples come out like this:
| Trade example | True cost an hour | Price an hour at a 20% margin |
|---|---|---|
| Painter | about $74 | about $92 |
| Carpenter | about $93 | about $116 |
| Landscaper | about $96 | about $120 |
| Electrician | about $104 | about $130 |
| Plumber | about $113 | about $142 |
| Concreter | about $116 | about $146 |
| Builder | about $142 | about $177 |
Worked from the example inputs on the hourly rate calculator. They are not award rates, market rates or what anyone earns. Put your own numbers in.
Super is part of it: the ATO's super guarantee rate went from 11.5% to 12% on 1 July 2025. A change like that moves your true hourly cost, and every price built on it.
2. The job's costs
These are the costs this job adds: materials at what your supplier charges today, plus a waste allowance; the hours each stage will take, for everyone on the job, at the true hourly cost above; subcontractors, hire, disposal and permits; and a contingency for what you could not see. Size the contingency to how much you could not inspect, and write down what it covers. If the unknown part is big, price it by the hour or as a provisional sum instead of guessing.
3. Your margin
Margin is profit as a share of the price. To get it, divide the cost by (1 minus the margin): for 20%, divide by 0.8. Adding a percentage on top of the cost gives you a markup, which is always a smaller margin:
| Add this markup | And your margin is |
|---|---|
| 10% | about 9% |
| 20% | about 17% |
| 25% | 20% |
| 30% | about 23% |
| 50% | about 33% |
Margin = markup / (1 + markup). The markup vs margin calculator converts any pair.
What is a good profit margin for a tradie covers what to aim for and why the number has to cover the jobs that go wrong.
Five ways to price a job, and when each fits
| Method | How it works | Fits | Watch for |
|---|---|---|---|
| By the hour | Your charge-out rate for the hours worked, plus materials | Fault finding, repairs, work you cannot see until you start | A minimum charge, so short jobs still pay for the travel |
| Fixed price | One price for a defined scope | Jobs you can measure and have done before | Every hour over the estimate comes out of your margin |
| Per unit | A rate per square metre, point, metre or item | Repeat work with a clear count | Travel and set-up, which do not shrink with the count |
| Cost plus | The actual costs, plus an agreed fee or percentage | Work where the scope cannot be pinned down | Records: every cost needs a receipt the client can check |
| Day rate | A rate per crew day, plus materials | Jobs measured in days, such as landscaping and small builds | Short days, weather and the time to pack up |
One business can use all five. Each one still has to trace back to the three numbers above.
On cost plus: in NSW, for example, the Government's page on residential building contracts says progress payments under a cost plus contract must be supported by receipts or other verifying documents. Other states have their own rules for home building work, so check with your regulator before you sign one.
A worked example: one job, priced three ways
An electrician is asked to fit 12 LED downlights in an existing house. The numbers are illustrative: $40 a light plus $60 of sundries, an hour for travel and set-up, half an hour a light, and the electrician example's true hourly cost of $104.
Twelve downlights: the cost
- Lights: 12 x $40, plus $60 of sundries
- $540
- Labour: 1 hour of travel and set-up + 12 x 0.5 hours = 7 hours x $104
- $728
- Total cost
- $1,268
- Price at a 20% margin: $1,268 / 0.8
- $1,585
Price ex GST: $1,585, with $317 of profit
Priced three ways, the job comes to the same number on the day. The difference shows when it takes two hours longer than planned:
| Method | Price as quoted | If it takes 9 hours, not 7 |
|---|---|---|
| Fixed price | $1,585 | Price stays $1,585, costs rise to $1,476, profit falls to $109 |
| Per point, $132 a light | $1,584 | Price stays $1,584, profit falls to $108 |
| By the hour: $130 an hour, materials at $675 | $1,585 | Client pays $1,845, profit holds at $369, still 20% |
$130 an hour is $104 / 0.8, and $675 is the $540 of materials / 0.8, so both carry the same 20% margin.
Hourly pricing moves the risk of the extra hours to the client, which is why it suits work you cannot see. Fixed and per-unit pricing keep the risk with you, which is fine when you know the job, as long as the quote says what is assumed.
Per-unit rates have one more trap. The same $132 a light on a four-light job comes to $528, but that job still needs the hour of travel and set-up: $180 of lights and sundries plus 3 hours at $104 is $492 of cost, which leaves $36 of profit, about 7%. Priced from its costs, the four-light job is $615. A per-unit rate needs a minimum charge or a separate call-out line to stay honest on small jobs.
Check the price before you send it
- Does every line trace back to a measurement, a supplier price or an hours estimate? A round number you cannot explain is a guess.
- Is the margin added by dividing, not by adding a percentage?
- Compare it with similar jobs you have done: per square metre, per point or per day. If it is well off, find the line that is different and say why in the quote.
- Does the scope say what is included, excluded and assumed, so a surprise becomes a variation and not free work?
- If you are registered for GST, is the 10% added and shown? Do I need to put GST on a quote explains the rules.
When to change your prices
Prices should move when your costs do, not just once a year. Look again when wages, super, insurance, fuel or supplier prices change; when jobs of one kind keep going over their hours; and when you win almost every quote you send, which can mean the price is too low for the work. Change the price list and the job templates you quote from, not just the next quote, so the new numbers stick.
The fastest way to see which prices are wrong is to compare each finished job with its quote: what it was priced at, what it really cost and what it made. That comparison is job costing, and it is what TrackYaTradie does on every job while it is still running.
Questions
What is the difference between pricing a job and quoting it?+
Pricing is working out the number from your costs and your margin. Quoting is putting that number in writing for the client, with the scope, exclusions, payment terms and an expiry date. You price first, then quote.
How do I price a job I have never done before?+
Break it into stages you have done before and price each one, then add a bigger contingency for the parts that are new and say in the assumptions what it covers. If part of it really cannot be priced until you open it up, price that part by the hour or as a provisional sum.
Should I match a competitor who is cheaper?+
Only if your own numbers say you can. Work out your price from your costs and margin first. If a competitor is well under it, they have lower costs, a different scope, or a price that will not survive the job. Losing a job priced below your cost is better than winning it.
How often should I review my prices?+
Whenever a cost behind them changes, such as wages, super, insurance, fuel or supplier prices, and whenever finished jobs show the same kind of work running over. Update the price list and templates you quote from so the change carries into every quote.