Plumbing
Plumbing Overhead Rate Calculator
Convert total overhead into a per billable hour figure so it can be recovered in pricing.
Result
Overhead is what the business costs whether or not you work. Wages for people who are on jobs belong in job cost instead, and counting them here overstates overhead and underprices everything.
Get a Free Business AuditWhat moves the number
- Total annual overhead, counted completely including the owner's time.
- Billable hours actually sold rather than hours worked.
- Whether service and installation should carry different rates.
Where this one goes wrong
Dividing by hours worked. It understates the rate substantially, and every hour priced from it under-recovers its share of overhead.
Questions
About this calculator
Why divide by sold hours?
Because only sold hours carry revenue. Overhead spread across hours you cannot invoice is overhead that never comes back.
Should the rate differ by work type?
It can, where service and installation consume different resources. A single blended rate means one subsidises the other.
How often should it be recalculated?
Annually, and immediately after adding a van or a person, because both change it at once.
The formula
overhead rate = monthly overhead / monthly revenue
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How to use this calculator
- Premises per month ($). Enter your own figure; the page starts at $1,800.
- Office and management wages ($). Enter your own figure; the page starts at $5,200.
- Vehicles, fuel and maintenance ($). Enter your own figure; the page starts at $2,400.
- Insurance and licensing ($). Enter your own figure; the page starts at $900.
- Software, phones and internet ($). Enter your own figure; the page starts at $450.
- Marketing and advertising ($). Enter your own figure; the page starts at $1,500.
The result updates as you type, so you can try a figure, see what it does to overhead per month, 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 |
|---|---|
| Premises per month | $1,800 |
| Office and management wages | $5,200 |
| Vehicles, fuel and maintenance | $2,400 |
| Insurance and licensing | $900 |
| Software, phones and internet | $450 |
| Marketing and advertising | $1,500 |
| Everything else | $700 |
| Monthly revenue | $39,000 |
What comes out
| Result | Value |
|---|---|
| Overhead per month main result | $12,950 |
| Overhead per year | $155,400 |
| Overhead rate | 33.2% |
| Cost of opening the doors | $588.64 |
Overhead runs $12,950 a month, 33.2% of revenue. Every working day costs $588.64 before anybody turns a wheel.
How sensitive the answer is
Holding everything else steady and changing only premises per month, this is what happens to overhead per month. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Premises per month ($) | Overhead per month |
|---|---|
| $900 | $12,050 |
| $1,350 | $12,500 |
| $1,800 example above | $12,950 |
| $2,700 | $13,850 |
| $3,600 | $14,750 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Premises per month ($)
- A money amount, starting at $1,800.
- Office and management wages ($)
- A money amount, starting at $5,200.
- Vehicles, fuel and maintenance ($)
- A money amount, starting at $2,400.
- Insurance and licensing ($)
- A money amount, starting at $900.
- Software, phones and internet ($)
- A money amount, starting at $450.
- Marketing and advertising ($)
- A money amount, starting at $1,500.
- Everything else ($)
- A money amount, starting at $700.
- Monthly revenue ($)
- A money amount, starting at $39,000.
What the results tell you
| Result | What it is |
|---|---|
| Overhead per month | The headline result. A money figure. |
| Overhead per year | A money figure. |
| Overhead rate | A percentage. |
| Cost of opening the doors | 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.