Tree service
Tree Service Overhead Calculator
Totals overhead, where the yard and the fleet are the bulk of it.
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 AuditHow the calculation works
The monthly total of what the business costs whether or not a crew leaves the yard: premises and yard space, office and management wages, vehicles and equipment finance and maintenance, insurance and licensing, software and communications, and marketing. Divided by monthly revenue it gives an overhead rate, and divided by working days it gives the cost of opening the doors each day.
What moves the number
- Equipment and vehicle finance, insurance and maintenance.
- Yard space, which this trade needs for equipment and sometimes debris.
- Insurance and licensing, which are substantial here.
- Office and management wages for people who are not on crews.
Where this one goes wrong
Crew wages belong in job cost rather than overhead, and mixing them in overstates the overhead rate and distorts pricing. The line that does belong and is often forgotten is the yard: tree services need space for trucks, chippers, grinders and often a debris or log area, and that is a real monthly cost that a service business working from vans does not carry. Equipment maintenance is the other item, since it is substantial on this kit and accrues steadily whether or not a specific job caused it.
Before you quote
- Keep crew wages in job cost, not overhead.
- Include yard space, which this trade genuinely needs.
- Count equipment maintenance as a recurring overhead item.
Questions
About this calculator
Do crew wages count as overhead?
No. Anything that scales with the work is job cost. Overhead is what the business costs when the trucks stay parked: yard, management, finance, insurance, software and marketing. Mixing crew wages in overstates the overhead rate and distorts every price built from it.
What overhead does tree care have that other trades do not?
Yard space, mostly. Trucks, chippers, grinders and often a debris or log area need somewhere to live, which a trade working from vans does not carry. Insurance is the other, since the rates on this work are a large multiple of a light trade's.
Should equipment maintenance be overhead or job cost?
It can be either provided it is recovered, and treating it as overhead is simpler because it accrues steadily rather than per job. What matters is not omitting it, since maintenance on chippers, grinders and bucket trucks is substantial and continuous rather than occasional.
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 | $37,000 |
What comes out
| Result | Value |
|---|---|
| Overhead per month main result | $12,950 |
| Overhead per year | $155,400 |
| Overhead rate | 35.0% |
| Cost of opening the doors | $588.64 |
Overhead runs $12,950 a month, 35.0% 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 $37,000.
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. |
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.