How to Price Building Work

How to price building work: build the price up from cost, starting with measured quantities, labour by task, materials with wastage, subcontractor prices, preliminaries, then overheads and profit on top. Anything you cannot price yet goes in as a provisional sum or a prime cost sum, not a guess.

Estimate, quote or fixed price

Decide what you are giving before you price it. An estimate is your best guess and can move. A quote is a fixed price for a defined scope. Once accepted, the scope wording matters as much as the number. See is a quote legally binding.

Step 1: Take off the quantities

Measure everything from the drawings or on site: square metres of wall, metres of footing, cubic metres of dig and concrete, openings. Write it down as a list.

This is the bit that decides the rest. A good labour rate on the wrong quantity is still the wrong price.

Step 2: Price labour by task

Price each task against a rate basis you trust. Brickwork is the classic one: builders price it per 1,000 bricks laid, because a gang’s daily output is steady once you know it. Other tasks go per square metre, per metre run, or per day.

Use your own output figures from past jobs, not a price book. A price book doesn’t know your gang, your access or how far the barrow run is.

Step 3: Get subcontractor prices, then add attendance

Get written prices from your sparks, plumber and plasterer, then add a markup for attendance. Attendance is what it costs you to have them there: skip space, scaffold, power, clearing up, and your time chasing them. If you pass their price through at cost, you’re running their job for free. The subcontractor charge-out calculator works that bit out.

Step 4: Materials plus wastage

Price materials from a current merchant quote and add a wastage allowance for cuts, breakages and the pallet that turns up short. Then add your markup. The material markup calculator shows why markup and margin aren’t the same number.

Step 5: Preliminaries

Preliminaries are the job costs that aren’t any one task: scaffold, skips, welfare, site setup, fencing, tool hire, parking. On a small job they’re easy to forget and they all come out of your profit when you do.

Step 6: Unknowns: provisional sums, PC sums and contingency

Don’t guess what you can’t see. Use a provisional sum for work you know is coming but can’t define yet, like drainage you haven’t exposed. Use a prime cost sum for items the customer hasn’t chosen, like a gate or a kitchen, plus your markup for fixing. Add a small contingency for risk you are carrying yourself.

Step 7: Overheads and profit

Add overheads as a percentage for the van, insurance, accounts and the evenings pricing jobs you don’t win. The trade business overhead calculator gives you the real figure. Then add profit as a separate line. Overheads keep the lights on. Profit is what’s left.

Worked example: a garden wall

All figures are illustrative to show the arithmetic. They are not market rates. Use your own.

A one-brick-thick garden wall, 12 m long and 1.4 m high, with a gate the customer hasn’t picked yet.

Brickwork labour: Working 16.8 m² × 120 bricks = 2,016 bricks × £900 per 1,000, £ 1,814

Groundworks labour: Working 2 days × £240, £ 480

Bricks: Working 2,016 + 5% waste = 2,120 × £0.75, £ 1,590

Mortar, concrete, coping: Working sand and cement £260, concrete £225, coping £300, £ 785

Preliminaries: Working skip £300, mixer hire £120, £ 420

Direct cost: 5,089

Overheads: Working 12% of direct cost, £ 611

Profit: Working 10% of £5,700, £ 570

Wall price: 6,270

PC sum: gate: Working £400 allowance + 10% for fixing, £ 440

Total: 6,710

Look at the prelims. £420 is 7% of the price. Leave it off and most of your profit is gone before you’ve laid a brick.

Variations and stage payments

When the customer changes something mid-job, price it as a variation, in writing, before you do it. The job variation pricing calculator keeps the same rates you quoted with.

On longer jobs, agree stage payments at the quote stage, tied to things you can both see finished: footings in, walls to plate, roof on. See payment terms for trade work.

Common mistakes

Pricing from square metre rules of thumb. They are for homeowners budgeting. Your price comes from your quantities and your output.

Passing subbies through at cost. No attendance, no markup, all of the hassle.

Leaving prelims off small jobs. The skip still costs the same.

Do this in FieldHive

Build the price line by line in the trade job pricing calculator and see the margin before you send it. Then turn it into a clean quote with the quote and estimate builder, free in your browser. Want quote, job and invoice in one place on your phone? Get the FieldHive app.

Aid, not advice

This guide explains a method for building up a price. Its figures are illustrative, not market rates, and it is not financial or legal advice. Your rates should come from your own costs and output.