How to Quote a Building Job Without Losing Money

Why Builders Underquote (and How to Stop)

Every builder's done it. You price a job, win it, and halfway through realise you're working for nothing — or worse, losing money. It usually comes down to one of three things: you forgot to include something, you underestimated how long it would take, or you were too worried about losing the job to price it properly.

The truth is, a job you win at the wrong price is worse than a job you don't win at all. At least when you walk away, you've still got your time and your reputation.

Here's how to build a quote that actually makes you money.

Breaking Down Your Costs

Every quote should account for these six categories. Miss one and your margin disappears.

1. Materials

This is the one most builders focus on, but it's also where mistakes creep in. Common errors include:

• Not accounting for waste — you'll lose 5-10% on bricks, timber, and plasterboard to cuts and breakage. Roofing tiles can be 10-15% waste depending on the roof geometry.
• Using old prices — material costs shift regularly. Always get fresh prices from your merchants before quoting. Don't rely on what you paid six months ago.
• Forgetting the small stuff — fixings, sealants, DPM, cavity trays, lintels, ventilation. These "small" items can add up to hundreds of pounds on a typical job.

Our Concrete Calculator can help you get accurate volumes for foundations, slabs, and oversite — so you're ordering the right amount and not paying for an extra load you don't need.

2. Labour

This is where most money gets lost. Be honest about how long things actually take — not how long they should take in perfect conditions.

Consider:

• Your own time — if you're on the tools, you need to charge for your labour too
• Subcontractors — get written quotes from your subbies before you price the job
• Productivity — winter work is slower, restricted access adds time, working around an occupied house adds time
• Preliminaries labour — setting up, clearing down, site tidying, tip runs

3. Plant and Equipment

Anything you're hiring or using:

• Scaffold hire (and the cost of moving it if the job has multiple phases)
• Skip hire — don't forget you might need more than one
• Mini digger, dumper, telehandler
• Generators, mixers, compactors
• Tool consumables — diamond blades, drill bits, saw blades

4. Waste Disposal

This catches people out. A single-storey extension strip-out can easily fill two or three skips. Factor in:

• Skip hire or grab lorry costs
• Segregation requirements (plasterboard must go separately)
• Asbestos removal (if applicable — this needs a specialist)
• Tip runs if you're using your own vehicle

5. Overheads

These are the costs of running your business that exist whether you're on a job or not:

• Van running costs and fuel
• Insurance (public liability, employer's liability, all-risks) — the Federation of Master Builders recommends a minimum of £5 million public liability cover
• Tools and equipment maintenance/replacement
• Accountancy, phone, software
• Training and card renewals (such as CSCS cards and CITB training)

Work out your annual overheads and divide by the number of working weeks to get a weekly overhead figure. Then add a proportional amount to every quote.

6. Profit Margin

This is not your wages — that's covered in labour. Profit is the return on the risk you're taking, the money that grows your business, replaces your van, and covers the quiet months.

Typical profit margins in construction:

| Job Type | Typical Margin | |----------|---------------| | Small domestic works | 15-25% | | Extensions and renovations | 15-20% | | New builds | 10-15% | | Commercial fit-out | 10-15% | | Insurance/emergency work | 20-30% |

If you're consistently working below 15% net margin on domestic work, you're not charging enough.

Day Rate vs Price Per Metre

There's an ongoing debate about whether to charge day rates or fixed prices. Both have their place.

Day rates work well for:

• Maintenance and repair work where the scope is uncertain
• Work where the client keeps changing their mind
• Jobs where access or site conditions are unpredictable

Fixed prices (often priced per square or linear metre) work well for:

• Clearly defined scopes — plastering, tiling, flooring
• Competitive tender situations
• Giving the client cost certainty

If you go with fixed pricing, make sure your rate per metre includes everything — not just materials and labour, but your share of overheads and profit too.

Contingency: How Much Is Enough?

Every quote should include a contingency allowance for unknowns. How much depends on the job:

• Straightforward new work — 5% contingency
• Renovation/alteration work — 10% contingency (you never know what's behind the walls)
• Work on older properties (pre-1940) — 10-15% contingency
• Listed buildings — 15-20% contingency

You can either build this into your rates or show it as a separate line. Either way, don't skip it.

Worked Example: Pricing a Single-Storey Rear Extension

Let's walk through a realistic example. A 4m x 5m single-storey rear extension with a flat roof, bi-fold doors, and a basic kitchen fit-out. Detached house, decent access, no party wall issues.

| Cost Category | Estimated Cost | |--------------|---------------| | Foundations (strip foundations, concrete, rebar) | £3,800 | | Groundworks (drainage, oversite, DPM, insulation) | £2,400 | | Brickwork/blockwork (walls to plate level) | £4,200 | | Roof structure (flat roof, joists, firring, insulation, membrane) | £3,600 | | Bi-fold doors (supplied and fitted, 3m opening) | £3,500 | | Windows (1 no. side window) | £650 | | Electrics (subcontractor, first fix and second fix) | £2,200 | | Plumbing (subcontractor, radiators, waste runs) | £1,800 | | Plastering (subcontractor, skim all walls and ceiling) | £1,600 | | Floor screed and tiling | £1,400 | | Kitchen units (mid-range, supply and fit) | £4,500 | | Decoration (mist coat and two coats throughout) | £900 | | Scaffolding | £1,200 | | Skip hire (2 x skips) | £600 | | Building control fees | £500 | | | | | Subtotal (direct costs) | £32,850 | | Overheads (12%) | £3,942 | | Contingency (10%) | £3,285 | | Profit (18%) | £7,214 | | | | | Quote to client | £47,291 |

Round that to £47,000 - £48,000 depending on specification.

Some builders would look at the direct costs and quote £35,000 "plus a bit on top." That "bit on top" should be over £14,000 — and many builders don't realise that until it's too late.

Run the figure through the Job Profit & Margin Checker before you send it. It shows the break-even price, actual margin and the amount needed to reach your target. Then use the Quote Generator to turn the checked price into a professional client quote.

Materials Markup: What's Normal?

If you're supplying materials, you're entitled to mark them up. You're spending time sourcing, ordering, checking deliveries, and taking the risk on damaged or incorrect goods. Typical markups:

• General materials (timber, bricks, cement, plasterboard): 10-20%
• Specialist materials (steel, architectural items): 10-15%
• Client-specified items (specific tiles, sanitaryware): 5-10% or supply at cost

Be transparent with clients about whether your quote includes materials at cost or with markup. Either approach is fine — just be consistent.

When to Walk Away

Not every job is worth quoting. Walk away when:

• The client has already had five quotes and is shopping purely on price
• The scope is vague and the client won't commit to a specification
• Access is terrible and will add days to the programme
• You're being asked to work without a proper contract
• Your gut tells you the client will be difficult

Your time has value. Spending a day measuring up and pricing a job you won't win (or shouldn't win) is a day you could spend on site earning money.

Getting Your Quote Right Every Time

The difference between a profitable builder and one who's constantly chasing their tail usually comes down to estimating. Get your numbers right, include everything, and don't be afraid to charge what the job is worth.

For help calculating material quantities accurately, try our Roofing Calculator and Concrete Calculator — getting your quantities right is the first step to getting your price right.