Quick Formulas & Success Tips
01
Gross Margin
(Revenue − Job Costs) ÷ Revenue × 100
Price every job to cover materials, labor, and overhead — not just materials and labor.
02
Labor Cost
Total Labor Cost (incl. burden) ÷ Revenue × 100
Burden is payroll taxes, WCB, and benefits on top of wages — owners who skip it often underestimate true labor cost by 15–20%.
03
Overhead Rate
Total Monthly Overhead ÷ Billable Hours per Month
Recalculate this every 6 months — overhead creeps up faster than most owners notice, and every quote should be built on the current number.
04
Owner's Pay
Market-Rate Wage, Paid Separately From Profit
Pay yourself a real wage first, then treat what's left as profit — blending the two makes it impossible to know if the business actually works.
05
Cash Reserve
Cash on Hand ÷ Average Monthly Expenses
Build toward 3 months before chasing growth — reserve is what buys you the ability to make decisions instead of reacting to them.
Benchmarks are adjusted to the trade you selected above, based on general industry data for contractor and home-services businesses — actual healthy ranges still vary by business model, region, and growth stage. This scorecard is a starting point, not personalized financial advice. A Profit Clarity Call gets you the specific picture for your business.
