Guide
Most 30% gaps are scope gaps, not price gaps. Here's how to check that, work out whether matching the price would put you below cost, and what to offer instead if it would.
The customer calls or emails: "Someone else quoted 30% less, can you match it?" Your gut says either drop the price to keep the job, or walk away and mutter about race-to-the-bottom pricing. Both reactions skip the useful step, which is finding out why the gap exists and whether matching it is even mathematically possible without losing money.
Run these four checks in order. Each one takes ten minutes. Together they tell you whether to match, partly match, or let the job go.
Get the other quote, or ask the customer to read out the line items. A 30% gap almost never comes from one contractor being 30% more efficient. It usually comes from one of these:
Ask the customer directly: "What's included in their price — materials, disposal, guarantee?" Most homeowners haven't compared line by line. Once you list what's missing from the cheap quote, the gap often explains itself and there's nothing to match.
Sometimes it can. Ask what's different about how they're set up, or work it out from what you know of the market:
If none of these plausibly account for 30%, scope is almost certainly the real explanation, so go back to check one.
This is the number that stops guesswork. Use your break-even price for the job — the price at which revenue covers materials, labour, and your share of fixed overhead, with nothing left over. If you don't have this worked out already, the break-even calculator will get you there in a couple of minutes using your own job costs.
The rule of thumb: if your normal gross margin on a job is around 30%, a 30% price cut takes you roughly to break-even, or below it once you account for the risk of overruns. There's no volume of extra jobs that rescues a job priced below its own break-even point — you just lose money faster on more work.
Worked example. Say a bathroom refit job:
Competitor quotes £2,940 (30% less than your £4,200). Compare that to your £3,400 cost. Matching that price means trading at a £460 loss before you've even accounted for callback risk or your own time being unpaid. There is no discount level here that works — you'd need to either shed £460+ of cost from the job (different materials, less labour) or refuse to match.
Now compare a job where your margin is higher, say a smaller electrical job:
| Item | Amount |
|---|---|
| Your quote | £600 |
| Total cost (materials + labour + overhead) | £380 |
| Gross margin | £220 (37%) |
| Competitor quote (30% less) | £420 |
| Result of matching | £40 margin (7%), still above cost |
Here matching is survivable, though thin. That 7% margin gives you almost no buffer for a delay, a missing part, or a difficult access issue. This is exactly the calculation the markup and margin calculator is built for — plug in your cost and target margin and see what price a 30% cut actually leaves you with, job by job.
Don't match to break-even. Break-even means every hour you spend on the job earns nothing towards your fixed costs, your tools, your time off, or your next van. The rule that keeps you in business:
Only match a price if it still clears your break-even cost plus 15%. That 15% is not profit you're banking — it's the minimum buffer against overruns, delays, and the admin time a job always eats that never makes it onto the invoice.
In the bathroom example, break-even was £3,400. Break-even plus 15% is £3,910. The competitor's £2,940 quote is nowhere near that, so the answer is no — don't match, let that one go.
In the electrical example, break-even was £380. Plus 15% is £437. The competitor's £420 quote falls just under that. Technically it fails the rule, but it's close enough that concessions (see below) could bridge the gap rather than a straight price cut.
If a job clears the rule comfortably, matching is a reasonable business decision, not a desperate one. If it doesn't clear it, walking away and keeping that capacity for a full-price job is usually the better trade — a half-day spent losing money on one job is a half-day you can't spend earning properly on the next one.
If you want to keep the customer without cutting the number, concede things that cost you less than they're worth to the customer. Ranked roughly by how much margin they preserve, best to worst:
Whichever way you go, once the job's done, look at what it actually cost versus what you quoted. Overruns on materials or hours eat into thin margins fast, and a job that looked fine on paper can slip below break-even in practice. The job profitability calculator is useful here — run your actual numbers after the job to see whether the decision you made was the right one, and adjust your break-even assumptions for next time.
Don't react to the 30% figure on its own. Check the scope first — that's where most of the gap usually lives. If the scope really is the same, work out your break-even cost and see whether their price clears it plus a 15% buffer. If it does, matching is fine. If it doesn't, no amount of extra volume makes up the difference, so keep your capacity for work that pays properly, and offer concessions other than price to try to keep the customer without the loss.
The Small Business Operations Kit ($19) turns guides like this one into fill-in-once worksheets: rate card, quoting sheet, job costing, payment terms and follow-up templates. Built by the same people who write these guides.