How to price a job as a tradie: rates, markup and profit

Pricing is where most tradie businesses are won or lost. You can be flat out, booked for weeks, and still go backwards if your prices don't cover your real costs. This guide shows a simple way to get to a number that works.

This guide is general information, not financial advice. Your accountant can help you check your figures.

Step 1: Work out your real costs

Start with a year. List everything the business spends that isn't materials for a specific job:

• Ute or van: repayments, fuel, rego, insurance, servicing
• Insurance: public liability, income protection, tools
• Tools and equipment, including replacements
• Phone, software and subscriptions
• Licences, registrations and training
• Accountant and bookkeeping
• Advertising, website, uniforms

Add it up. For a solo tradie this is often somewhere around $25,000 to $40,000 a year, but use your own figures.

Step 2: Be honest about billable hours

You might work 50 hours a week, but you won't bill 50. Travel, quoting, picking up materials, admin, rain days, sick days and holidays all eat into it.

A rough example:

• 46 working weeks (after holidays, public holidays and a few sick or rain days)
• 30 billable hours a week
• 1,380 billable hours a year

Step 3: Your hourly rate

Add what you want to pay yourself to your yearly costs, then divide by your billable hours.

($90,000 wage + $30,000 costs) ÷ 1,380 hours = $86.96 an hour

That's your break-even before profit. Add a profit on top (the business deserves one, separate from your wage) and you might land at $100 to $110 an hour. That's why charging $65 an hour "because that's what my old boss paid me" doesn't work once you're on your own.

Step 4: Markup vs margin

These two get mixed up all the time, and the mix-up costs money.

• Markup is profit as a percentage of your cost.
• Margin is profit as a percentage of the price.

Worked example

Your cost for a job (labour and materials) is $1,000.

• Add a 25% markup: $1,000 + $250 = $1,250.
• Your profit is $250. As a share of the $1,250 price, that's a 20% margin.

If you wanted a 25% margin, you'd need a price of $1,333.33 (because $333.33 is 25% of $1,333.33).

If your accountant talks about margin and you price with markup, make sure you're talking about the same number.

Step 5: Materials

Materials need a markup too. You spend time ordering and picking them up, you carry the risk if they're wrong or damaged, and you warrant the work. Many tradies add somewhere around 10% to 30% on materials, but the right figure is whatever makes your total price cover your costs and leave a profit.

Step 6: Call-out and minimum charges

For service work, a call-out fee or minimum charge protects you from the 15-minute job that costs you an hour of driving. Common approaches:

• Call-out fee that includes the first half hour, then an hourly rate
• Minimum charge of one hour
• Higher rates for after-hours and emergency work

Say it on your website and on the quote, so nobody's surprised.

Step 7: Price the job, not just the hours

For jobs you can measure, quote a fixed price. Build it from your rates (per point, per metre, per square metre, per day), then sanity check the total against how long it'll really take. If you're consistently quicker than your price assumes, that's your reward for being good at your trade.

Don't forget card fees and GST

• Card fees: surcharges on Visa, Mastercard, eftpos and American Express are banned from 1 October 2026, so the fee belongs inside your price. See the card surcharge ban guide.
• GST: if you're registered, your price to consumers should include GST. See GST on quotes.

When to put your prices up

Prices aren't set and forget. Review them at least once a year, and sooner if:

• Your main material costs have gone up noticeably.
• You're winning almost every quote. That usually means you're cheaper than you need to be.
• You're booked out for weeks. Demand is telling you something.
• Your costs have changed (a new ute, higher insurance, a new apprentice).

When you do lift prices, change them once in the place you build quotes from, so every new quote uses the new rate. Quotes you've already sent can stay at the old price until they expire.

Check the job after it's done

The best pricing data you have is your own finished jobs. After each job, compare what you quoted with what it actually took: hours, materials, trips, rework. If one type of job keeps running over, your price for it is too low. If another is always quicker, you've found your most profitable work, and maybe the work to advertise.

Keep your profit private

Customers don't need to see your markup. Price each line at your cost, add your profit, and show the customer the final price. Karven does this for you: you type your cost, set your profit percentage once and it goes on top of every line, and only you see it on your copy of the quote.

Checklist

• Know your yearly costs
• Count real billable hours, not hours worked
• Work out a break-even hourly rate, then add profit
• Know whether you're talking markup or margin
• Mark up materials
• Set a call-out fee or minimum charge for service work
• Price card fees and GST in

Next: how to write a quote that shows the price clearly.

This guide is general information, not financial or tax advice. Talk to your accountant about your numbers.