How to Price a Remodeling Job
Pricing your remodeling services is simple, but sometimes it can be tricky to balance a fine line of what you need to charge in order to keep your business going and at the same time compete with other leading companies. Research will help you get it right. Find out what other companies don't have and offer it. This will ensure you to receive the prices you deem necessary to keep your business profitable.
Calculate the material cost. This calculation shows the cost for the remodeling materials. The result will of course depend on what's being remodeled. Make sure to include any tools that you'll need to get if you don't already have them. Add everything together to get your material cost.
Decide how long the remodeling at hand will take. You can charge either by the hour or by the day. Once you have established how long the remodeling will take, you have to decide how many construction workers will be working on the project. Multiply the number of workers by the amount of time the remodeling will take. The result will be your labor cost.
Establish your profit margin. Now that you have calculated all of the essential costs, the last calculation is figuring how much of a profit you will make. You need to take into consideration what your competitors charge as well as the income your business needs to survive. You will need to calculate an average amount that your company needs to make per month. Divide that amount with how many services you expect to complete. The result is the average profit you need to make with each service. Compare the result you received with the price of a common service and all of its costs of material and labor. Figure the percentage and this will be your profit margin. For the sake of ease, we'll say your profit margin is 15%.
Add all of the calculations together to receive the cost you should charge. To do this, add the results of your material cost and labor cost. Once you have established the sum of these two charges, figure what 15 percent of the result is. Then add the profit margin result with the material cost and labor cost to receive your final quote.