Plumbing
Plumbing Net Profit Calculator
Work out what is left once every cost, direct and overhead, has been taken out.
Result
Net profit here is before tax and before any owner's draw that is not already inside overhead. If you pay yourself out of what is left, this figure is your wage rather than the company's profit.
Get a Free Business AuditWhat moves the number
- Overhead, which continues whether the vans roll or not.
- Owner compensation, treated as a cost rather than as whatever remains.
- Bad debt, which in plumbing is real and rarely budgeted.
Where this one goes wrong
Treating owner pay as profit. If the owner is doing work that would otherwise be hired for, the market rate for that work is an expense and profit is what remains after it.
Questions
About this calculator
Should the owner take a wage before profit?
Yes, at a market rate for the work actually done. Otherwise the business looks profitable while the owner is unpaid, or the reverse.
Where does bad debt belong?
As a cost, budgeted from experience rather than discovered. Every service business writes some off and pretending otherwise flatters the figure.
What net margin is normal?
It varies with mix, size and market, so your own trend is more useful than a benchmark whose definitions you cannot see.
The formula
net profit = revenue - direct costs - overhead
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How to use this calculator
- Revenue ($). Enter your own figure; the page starts at $39,000.
- Direct labour ($). Enter your own figure; the page starts at $16,000.
- Materials and equipment ($). Enter your own figure; the page starts at $11,000.
- Other direct costs ($). Enter your own figure; the page starts at $2,200.
- Overhead ($). Enter your own figure; the page starts at $12,000.
The result updates as you type, so you can try a figure, see what it does to net profit, 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 |
|---|---|
| Revenue | $39,000 |
| Direct labour | $16,000 |
| Materials and equipment | $11,000 |
| Other direct costs | $2,200 |
| Overhead | $12,000 |
What comes out
| Result | Value |
|---|---|
| Net profit main result | -$2,200 |
| Net margin | -5.6% |
| Total direct cost | $29,200 |
| Profit per working day | -$100 |
That is -$2,200 at a -5.6% margin, about -$100 for every working day.
How sensitive the answer is
Holding everything else steady and changing only revenue, this is what happens to net profit. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Revenue ($) | Net profit |
|---|---|
| $19,500 | -$21,700 |
| $29,250 | -$11,950 |
| $39,000 example above | -$2,200 |
| $58,500 | $17,300 |
| $78,000 | $36,800 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Revenue ($)
- A money amount, starting at $39,000.
- Direct labour ($)
- A money amount, starting at $16,000.
- Materials and equipment ($)
- A money amount, starting at $11,000.
- Other direct costs ($)
- A money amount, starting at $2,200.
- Overhead ($)
- A money amount, starting at $12,000.
What the results tell you
| Result | What it is |
|---|---|
| Net profit | The headline result. A money figure. |
| Net margin | A percentage. |
| Total direct cost | A money figure. |
| Profit per working day | A money figure. |
Before you rely on this number
Pipe sizing, flow and pressure figures depend on the actual fittings, the run, the material and local code. Code requirements vary by jurisdiction and override any general calculation, so check what applies where the work is happening.
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.