How to cost a building job (and know if you made money)
Plenty of good builders are busy all year and still don't know which jobs made money. Costing a job properly has two halves: pricing it before you start, and tracking the real costs while you build.
Step 1: Measure and list the materials
Work from the drawings and list every material with a quantity: bricks, blocks, cement, sand, lintels, insulation, timber, roofing, plasterboard and fixings. Add a waste allowance, typically 5 to 10 percent depending on the material, and include delivery charges.
Step 2: Price the labour
Estimate how many days each stage takes and for how many people: groundworks, brickwork, roof, first fix, plastering and so on. Multiply by what each person actually costs you per day, not just what you pay them. Half days count, so record them as half days.
Step 3: Add subcontractors and plant
Get written prices from your electrician, plumber, roofer or plasterer, and add skips, scaffolding, mini-digger hire, welfare and anything else you hire in.
Step 4: Cover your overheads
Your van, fuel, insurance, tools, phone, accountant and software all have to be paid by the jobs. Work out your yearly overheads, divide by the working weeks, and make sure each job carries its share.
Step 5: Markup vs margin
Markup is what you add on top of cost. Margin is the share of the price that is profit. They are not the same. For example, if a job costs £10,000 and you add 20 percent markup, you charge £12,000, but your margin is £2,000 out of £12,000, which is about 16.7 percent. Decide which one you are working to and stick to it.
Step 6: Track actual costs while you build
The price is only a plan. Log every materials receipt, every day of labour and every subcontractor invoice against the job as it happens. Compare the running total with your price at each stage, so you spot an overrun while there is still time to do something about it.
How HODHQ helps
HODHQ keeps materials, labour, subcontractors and receipts against each job and shows the profit as you go. You can photograph a receipt and Doreen files it on the right job once you confirm. It can also create a materials take-off from architect drawings as a starting point for pricing.
Common questions
What is the difference between markup and margin for builders?
Markup is the percentage added on top of cost. Margin is profit as a percentage of the selling price. A 20 percent markup on a £10,000 cost gives a £12,000 price and a margin of about 16.7 percent.
How much waste should I allow on a building job?
Builders commonly allow around 5 to 10 percent for waste, depending on the material, cutting and site conditions.
Last updated 28 September 2026. Written by HODHQ, built by Rich Brickwork Ltd.