Electrical
Electrical Pricing Calculator
Calculate an electrical selling price that recovers direct cost, a revenue-based overhead allowance and the chosen profit target.
Result
Overhead and margin are taken as shares of the selling price, which is why the cost is divided rather than multiplied. Adding 15% to cost does not produce a 15% margin. Gross profit is what is left after the cost of doing the job. Overhead comes out of that: the building, the office wages, the vans, insurance, software and advertising. A healthy gross margin still loses money if overhead is larger.
Get a Free Business AuditWhat moves the number
- Include all labour, materials and direct costs for the quoted scope.
- Overhead and target margin are entered as shares of selling price.
- The two percentages together must leave a positive share for direct cost.
Where this one goes wrong
This method divides cost by the revenue share left after overhead and margin. It is not equivalent to adding those percentages to cost. Also avoid entering direct costs that already contain the same overhead allocation.
Questions
About this calculator
What if the overhead and margin inputs approach the whole price?
The required selling price rises sharply because little revenue remains to cover direct cost. Revisit the assumptions; an impossible denominator is not a commercially meaningful quote.
Does the result establish a market price?
It establishes a price implied by your cost and recovery targets. Customer scope, alternatives and willingness to buy remain separate commercial questions.
How should a cheaper alternative be evaluated?
Change the real scope and cost assumptions, then recalculate. Lowering price while leaving the work unchanged reduces recovery and should be an explicit decision.
The formula
price = direct cost / (1 - overhead% - margin%)
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How to use this calculator
- Labour cost ($). Burdened: wages plus tax, insurance and the vehicle, not the hourly wage.
- Materials cost ($). Enter your own figure; the page starts at $175.
- Other direct costs ($). Permits, disposal, equipment hire, subcontractors.
- Overhead rate (%). Overhead as a share of revenue. Work it out from last year's accounts.
- Target net margin (%). Enter your own figure; the page starts at 15%.
The result updates as you type, so you can try a figure, see what it does to price to quote, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Labour cost | $300 |
| Materials cost | $175 |
| Other direct costs | $0 |
| Overhead rate | 22% |
| Target net margin | 15% |
What comes out
| Result | Value |
|---|---|
| Price to quote main result | $753.97 |
| Direct cost | $475 |
| Overhead recovered | $165.87 |
| Net profit | $113.10 |
| Gross margin | 37.0% |
| Markup on direct cost | 58.7% |
Quote $753.97 to cover $475 of direct cost, recover $165.87 of overhead and leave $113.10 of net profit. That is a 58.7% markup on cost.
How sensitive the answer is
Holding everything else steady and changing only labour cost, this is what happens to price to quote. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Labour cost ($) | Price to quote |
|---|---|
| $150 | $515.87 |
| $225 | $634.92 |
| $300 example above | $753.97 |
| $450 | $992.06 |
| $600 | $1,230 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Labour cost ($)
- Burdened: wages plus tax, insurance and the vehicle, not the hourly wage.
- Materials cost ($)
- A money amount, starting at $175.
- Other direct costs ($)
- Permits, disposal, equipment hire, subcontractors.
- Overhead rate (%)
- Overhead as a share of revenue. Work it out from last year's accounts.
- Target net margin (%)
- A percentage, between 0 and 80, starting at 15%.
What the results tell you
| Result | What it is |
|---|---|
| Price to quote | The headline result. A money figure. |
| Direct cost | A money figure. |
| Overhead recovered | A money figure. |
| Net profit | A money figure. |
| Gross margin | A percentage. |
| Markup on direct cost | A percentage. |
Before you rely on this number
Conductor sizing, voltage drop and load figures are governed by code, and the code takes precedence over any calculator. Ambient temperature, conduit fill, continuous load factors and the specific installation all change the answer. Treat this as a first pass, not a design.
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.