To price a job, find the lowest number you can take without losing money, then add a cushion on top. That lowest number is your floor price. It comes from three inputs: what you need to earn per hour, what the job costs you, and how many hours it really takes.
This guide is a method you can repeat on any job, not a rate to copy. The example uses made-up numbers to show the arithmetic.
Fictional example: a house cleaner working alone, one standard clean. The numbers are made up. They are not rates to copy.
1. Your hourly pay
Take what you need to take home each month and divide it by all the hours you work in a month: on site, driving, quoting and invoicing. Don't divide by billable hours only.
Because this number already counts your driving and paperwork, you charge for every hour a job takes in step 3.
In the example, the answer is $30 an hour.
2. Costs per job
List what the job costs you: supplies, fuel and vehicle wear, disposal fees, and anything you buy for it. For tools that wear out, set aside a small amount per job so the replacement is already paid for.
In the example, supplies are $6.00 and fuel and wear are $6.00, so costs are $12.00.
3. Every hour the job takes
Count time on site, driving both ways, loading and setup, writing the quote, invoicing and follow-up. Charge for all of it.
In the example, the job takes 3 hours on site, 0.5 hours driving and 0.25 hours on messages and the invoice. That is 3.75 hours.
4. The floor price
Multiply the hours from step 3 by your hourly pay from step 1, then add your costs from step 2.
In the example, 3.75 hours at $30 is $112.50. Add the $12.00 in costs and the floor price is $124.50.
The floor has no margin in it. Below it, you're working for less than you decided you need. Write it on a card for each kind of job and don't quote under it.
5. Margin on top of the floor
A margin is a cushion for a slow week, a job that runs long, a dead tool, insurance and software. Pick a share you can defend, and take it from the exact floor price, before any rounding. In the example, 15 percent of $124.50 is $18.675, which makes $143.18.
Adjust the share after a few months of real numbers.
6. Round up
Round the result up to a clean number. $143.18 becomes a $145 quote.
Fictional example, all six steps in one table:
| Step | Item | Amount |
|---|---|---|
| 1 | Hourly pay | $30.00 an hour |
| 2 | Costs per job | $12.00 |
| 3 | Hours the job takes | 3.75 hours |
| 4 | Floor price: 3.75 hours at $30 is $112.50, plus $12.00 | $124.50 |
| 5 | Margin: 15 percent of $124.50 is about $18.68 | $143.18 |
| 6 | Quote, rounded up | $145 |
7. Compare with your area
Look at what two or three nearby businesses publish, or ask other owners. If you're far below them, look at your numbers again. If you're near them, don't drop under your floor to match anyone.
Hourly or flat
A flat price suits a job you can size up: a standard clean, a small yard, one vehicle. Turn your hours into a flat quote with the steps above. An hourly rate suits a job whose size is unclear. Quote the rate with an estimate range, and say you'll tell the customer before the job goes past the top of it.
If you can't tell how big a job is, don't guess a flat price. Ask for photos or do a short visit first.
Minimums and trip charges
A minimum is the lowest price you'll quote for any job. It exists because every job carries fixed hours, such as driving, setup, quoting and invoicing, however small the work is. Find yours by running steps 3 and 4 for the smallest job you'd take.
A trip charge covers a long drive. Price the drive hours at your hourly pay and add the fuel.
Say what the quote includes
Write down what the job includes and what it leaves out, in the quote. List the work, then the things customers often assume you'll do. Then extra work gets a new price instead of an argument: "That's not in the quote. I can add it for [price]."
Sales tax on services depends on where you work and what you do. Ask your state's department of revenue or an accountant before you add it. The same goes for licensing and insurance.
Check your price after a few jobs
For your next few jobs, write down when you arrived and when you left. Compare that with the hours you used in step 3. If a job ran longer than you counted, change the hours for the next quote. If your costs moved, change those too.
Where the quote goes next
Once the quote is sent, it needs a next step and a date, or it will sit in a text thread. SoloBackOffice has a free Excel follow-up tracker for that. It's made for Microsoft Excel. If you open it in another spreadsheet app, check the Due column before you rely on it.
The full guide, The One-Person Back Office, covers this job and 17 more.