How To Price Materials For Trade Jobs

You can price every cable, socket and light on a job and still lose money on the materials. Not because you forgot the big items. Because you priced the cheapest version of the job on a perfect day. Then the stock changes. Delivery costs appear. Small parts get used. And somebody spends 2 hours sorting the order. That is what I call the Material Cost Trap. You think you have priced the materials, but you have only priced the products. In this video, I'm going to show you the 4 costs I would check before adding markup. They are the base supplier price, consumables and small items, delivery and waste, and the time it takes to organise the order. Let's use a simple electrical example. You are pricing a job that needs cable, sockets, lights, containment, fixings and a few specialist parts. The tempting approach is to search every item online and build the quote from the cheapest price you can find. The cable is cheapest with 1 supplier. The sockets are cheaper somewhere else. The lights come from a 3rd supplier, and the specialist part has a long lead time. On paper, the material total looks excellent. But that price only works if every item is in stock, every delivery arrives on time and nothing changes once the job starts. That is a risky price to promise to the customer. A better approach is to use a realistic base price from a supplier you can rely on. That does not mean using the most expensive supplier. It means using a price you can reasonably expect to buy at when the job goes ahead. Then, if you find a better buying price after winning the work, you improve the margin. But if you need faster delivery or a different supplier, the quote still has a chance of holding together. That is the main idea: You are not just pricing the materials. You are pricing the cost of getting the right materials onto the job. The first thing to check is the base supplier price. The cheapest price is useful when you are buying. It is not always the safest price to build the quote around. You also need to think about stock, lead time, delivery, returns and how quickly the supplier can solve a problem. A slightly higher price from a dependable supplier may protect the job better than a cheaper item that is unavailable when you need it. So choose a realistic base price first. Buy well later. The 2nd thing to check is everything that sits around the main items. Most businesses remember the cable, the fittings or the equipment. The margin often disappears through the small parts used around them. Tape, blades, cable ties, screws, washers, connectors, sealants and other consumables may look insignificant on their own. But they are still being bought and used. Pack size matters as well. If the job needs 5 fixings but you must buy a box of 100, you still had to buy the box. The cost is not simply the price of 5 fixings. You had to buy the pack, store what remains and carry the risk that some of it is never used. You can deal with this in 2 ways. Where practical, add the small items directly to the quote. Where the list would become unreasonable, use a separate consumables allowance based on what similar jobs have actually used. Some businesses may start around 5–10%. The right level depends on how detailed the material list is and how many unknown small items are likely to appear. That is only a starting point. Your completed jobs should tell you whether it is enough. The 3rd thing to check is delivery, waste and anything hired specifically for the job. A courier charge is a job cost. A pallet delivery is a job cost. A skip, waste collection or item of hired equipment is also a job cost. These larger, known costs should normally appear as separate line items. Do not hide a skip or a special delivery inside a general consumables percentage. If you know the cost exists, show it clearly. The 4th thing is the time spent organising the materials. A simple order from 1 supplier may take very little time. A specialist job can be completely different. You may need several quotations, stock checks, lead-time checks, split deliveries, alternatives and follow-up calls when something does not arrive. That is not free time. It is procurement and management work. But be careful not to count it twice. If your labour rate already includes ordering, administration and management, you may already be covered. If your labour allowance is mainly based on time on the tools, the ordering work may need its own allowance. Estimate the time based on the actual job. A straightforward order may take 15 minutes. A job involving 5 suppliers and specialist lead times could take several hours. Now let's put those 4 costs together. Imagine the realistic supplier price for the main materials is £1,000. Delivery adds £40. Consumables and pack-size costs add another £60. Before markup, the material-related cost is already £1,100, plus the time needed to check and place the order. The cheapest online basket may have shown £920. But if you could not reliably buy, receive and organise everything for £920, that was never the true cost of delivering the job. This is where people sometimes mix 2 different things together. Material cost and markup are not the same. First, build the realistic cost of supplying the materials. Then decide what markup the business needs to add. Do not use markup to hide delivery, consumables or missing labour. Those are costs. Markup comes after them. We will deal with the different markup levels in the next video. There are 3 mistakes I would avoid. The first is using the cheapest visible price as though it is guaranteed to be available later. The 2nd is treating small items, delivery and waste as though they are free. The 3rd is adding a percentage without checking whether the real costs are already included or whether something is being counted twice. The structure should work across different trades. The products will change, but the questions stay the same. What can you reliably buy the main items for? What small materials will be used? What must be delivered, hired or removed? And how much time will it take to organise everything? After the job, compare the quote with what actually happened. Check the supplier price you allowed against what you paid. Look at the delivery charges, the small items used and the time spent organising the order. That review is how your material pricing improves. Not by adding a bigger guess to the next quote. By finding the cost that was missing from the last one. Before you price your next job, review your last 3 completed jobs. Find 1 material cost that the original quote did not properly allow for. It may be a delivery, a pack of fixings, a return journey or 2 hours spent chasing suppliers. That 1 check will tell you where your material pricing needs strengthening. The difficult part is applying the same logic every time, especially when more than 1 person starts producing quotes. That is where FieldHive can help. FieldHive is being built around reusable catalogue items. You can store the material description, part number and realistic base price instead of rebuilding the quote from memory. The quote can then stay connected to the job, making it easier to compare what you allowed with what the materials actually cost. FieldHive does not choose the supplier or decide the price for you. You still make that judgement. It gives the decision somewhere consistent to live. So remember: You are not just pricing the materials. You are pricing the cost of getting the right materials onto the job. Start with a realistic supplier price. Include the small items. Add the known delivery, waste and hire costs. And allow for the time needed to organise the order. Once the true material cost is clear, the next question is how much markup to add. Because a cable drum, a specialist item and 5 fixings from a pack should not all be treated in exactly the same way. That is what we will cover next: How To Add Markup To Trade Materials Without Guessing.