Anatomy of a profitable estimate

One estimate, built end to end, using every number this course produced. The job: a two-week install — 40 hours of labor, $2,200 in materials. The shop: the one you've been running since module 1.

Step 1 — Direct costs (module 1)

• Materials: $2,200, counted from the takeoff — with the waste factor already in it, not hoped away.
• Labor: 40 h × $75/h loaded cost = $3,000. Loaded means wages plus the taxes and insurance that ride on wages — what the hours cost YOU, not what you charge.

Step 2 — Overhead (lessons 2–3)

Forty billable hours carry the shop for forty hours:

$40 \text{ h} \times \$25/\text{h} = \$1{,}000$

Running total — the TRUE cost of this job:

$\$2{,}200 + \$3{,}000 + \$1{,}000 = \$6{,}200$

Any price below $6,200 loses money no matter how busy it keeps you.

Step 3 — Margin, by division (module 2)

Target a real 15% margin. Divide — never multiply:

$\text{price} = \frac{\$6{,}200}{1 - 0.15} = \$7{,}294$

Check it like you mean it: profit = 7,294 − 6,200 = $1,094, and 1,094 ÷ 7,294 = 15.0% of the PRICE. A 15% markup would have quoted $7,130 and quietly kept only 13%.

Step 4 — Terms (module 3)

The price protects profit; the calendar still needs defending:

• 30% deposit — $2,188 before materials are ordered
• 40% at rough-in — $2,918 tied to a visible milestone
• 30% on completion — $2,188, due on receipt, late clause stated

With costs of ~$5,200 spread over two weeks, the deposit plus rough-in payment keep the cash curve above water the whole job — you are never the bank.

Step 5 — Sanity checks (modules 2 and 4)

• Against break-even: $1,094 of contribution against a $2,500 fixed month — this job alone carries 44% of it. Two like it and the month is yours.
• Against time: if the client asks for "same price, but pay you in 90 days," that's not the same price — at your 10% money cost it's roughly $180 thinner. Counter with the schedule, or price the wait.

Ship it

Every number above has a lesson behind it; none came from a competitor's guess or a hopeful round figure. Now put it on paper worth signing: the Estimate & Invoice Studio takes the line items, the margin, and the deposit, and turns them into the branded document — and the job estimator covers the quick multi-trade takeoffs that feed it. The math was the hard part. You just did it.