Job Costing For Trades: What Your Finished Jobs Are Telling You

The job's done. Customer's happy, nobody's complained, everyone's moved on to the next one. And you're 2 hours down. You won't feel it on that job. You'll feel it in about six months, when you've priced the same work 20 more times with the same number. Here's the thing. That finished job has just told you exactly where your pricing is wrong. Most people never go back and listen to it. The job gets invoiced, the file gets shut, and the same number goes straight back out on the next quote. So I'm going to show you how to read a job after it's done. What to compare, how to work out which number was actually wrong, and what to change before you quote the next one. Say you've quoted a job using fit times. 10 sockets, 60 minutes a socket. That's 10 hours. Add your fit times on the cable, and you land on 16 hours of labour. Job comes back in at 18. So you're 2 hours over. Same job, same scope, nothing really went wrong. Just 2 hours you didn't price. That 2 hours is worth something on its own. But it's worth a lot more as information. Every quote you do should be an improvement on the last one. First thing. Go and look at the hours that got booked to that job. Not roughly. The real ones. Then put them next to what you quoted. On a day job, that's one number against one number. 16 quoted. 18 actual. You're 2 hours out, and that's all you get. It's still worth having. On a job that runs a week, you can go finer. Split it the way the work actually splits. First fix. Second fix. Testing. Because that's how the lads book it anyway. Nobody writes down 20 minutes a socket. And don't go asking them to. Now, before you touch anything, split it in two. There's two completely different ways a job costs you more than you thought. Either the hours were right, and what you're paying per hour was wrong. Or your rate was fine, and the job just took longer than you said it would. On the invoice they look identical. They're nothing like each other. If your rate's wrong, that's a wage and overhead problem, and it's on every job you do. If the hours are wrong, that's a fit time problem, and it's only on this kind of work. Work out which one you're looking at first, or you'll go and change the wrong thing. Right. Say it's the hours. Ask three questions. Were the fit times wrong? Is 60 minutes a socket actually right for how you work, on that kind of job? Was the uplift too low? Occupied building, bad access, working round other trades. Or did you apply the uplift at all? That's the one that catches people out. Because those are three different problems, and they've got three different fixes. One more before you change anything. Labour isn't the only thing that moves on you. There's really only three places a job goes wrong. The labour ran longer than you priced. The materials cost more than you allowed. Or you did work that never made it onto an invoice. That last one's the killer, and it's nearly always variations. Somebody said yes on site and nobody wrote it down. If that's what happened, your fit times were never the problem. You just gave the work away. So check that one first, because it's the quickest to spot and the most expensive to ignore. Once you know which it is, change that. If the fit time's wrong, update the fit time. If the uplift was light, update the uplift. Change one thing, not both and hope. Then next time that work comes up, you're quoting off the updated numbers. Not off memory, and not off last year's version of you. Let's put some money against it. 2 hours over, and say your labour's £45 an hour. That's £90. Doesn't sound like much, does it. Do that same job 20 times in a year and it's £1,800 you never charged for. And you'd never spot it, because every single one of those jobs looked absolutely fine. And here's why it happens more than you'd think. On an 8 hour day, you're realistically getting about 6 hours of productive time out of it. A quarter of the day goes on moving gear about, waiting on somebody else, finding out what's changed, walking back to the van. Your fit time only covers the productive bit. The rest still has to come from somewhere. And if you haven't priced it, it comes out of your margin. Three things to be careful with. Don't go changing your fit times off the back of one job. One job running over could be the site, could be a bad day, could be the bloke who collars you for 20 minutes about his loft conversion. You want to see the same thing happen a few times before you move a number you use on everything. Second. If it turns out you just forgot to apply the uplift, then your fit times are fine. Leave them alone. Fixing the wrong number makes your next quote worse, not better. And third. Putting your hourly rate up doesn't fix missing hours. If you're 2 hours short, you're 2 hours short at any rate. Bumping the rate just hides it for a bit, and makes you dearer than the bloke down the road while it does. Understanding this isn't the hard part. The hard part is doing it on every job, and having the change actually stick. Because if your fit times live in your head, or in a spreadsheet somebody copied last March, updating them doesn't really happen. And doing it once a year when the accounts come round is too late. By then you've priced another 50 jobs off the old number. This is half the reason I'm building FieldHive. The fit times sit in a catalogue you quote from. And when you book the work in, you're scheduling it against that quote. So the job and the number you priced it at stay attached to each other. That's the bit that makes any of this possible. If your estimate's in one place and the work's in another, you've got nothing to compare when it's finished. Then when you do learn something off a job, you change it once, and every quote after that uses it. FieldHive doesn't tell you what the right fit time is. That's your call, off your own jobs. Every quote you do should be an improvement on the last one. Get that loop running and your pricing stops being a guess you got away with. It starts being something you actually know. And once you're reviewing your labour properly, there's a next question. What happens when the same job keeps coming back, and you're pricing it from scratch every single time. That's the next one.