Guide
You don't need software to know which jobs make money. You need five cost buckets, a job number written on every receipt, and 20 minutes every Friday.
Ask most trades owners which jobs were profitable last month and you get a shrug. The bank balance went up, so things must be fine. But bank balance is cash across every job mixed together. One job can lose £400 and another can make £600, and the total still looks healthy. You never find the loser unless you split costs by job.
You don't need job costing software to do this. You need five cost categories, a habit of writing a job number on every receipt, and a short weekly routine. That's it. This is the minimum viable system, and it's the same maths behind our job profitability calculator, just done by hand.
For every job, track these five things separately. Nothing else matters at this stage.
Gross profit on the job is simple:
Gross profit = Invoiced total − (materials + own labour + subcontractors + vehicle/trip time + permits and fees)
Don't use your take-home pay. Use a loaded rate that reflects what an hour of you actually costs the business, including the time you don't bill.
Rough formula:
Loaded hourly rate = (Annual wage or drawings + employer costs + share of overheads) ÷ billable hours per year
Example: you pay yourself £42,000 a year, add £3,000 for insurance and pension contributions, and £5,000 as your share of van, tools, phone and admin overhead. That's £50,000. You work 46 weeks a year, 40 hours a week, but only about 65% of that is billable (the rest is quoting, driving to suppliers, admin). That's 46 × 40 × 0.65 ≈ 1,196 billable hours. £50,000 ÷ 1,196 ≈ £42 an hour. That's your cost, not your charge-out rate. Charge-out rate needs margin on top, which is a separate calculation — the markup vs margin calculator is built for exactly that step.
The whole system collapses if you can't match a receipt to a job later. The fix is boring but it works: give every job a short number when you book it (date-based is fine, like 0614-A for the 14 June, first job), and write that number on every receipt, invoice, and timesheet entry the moment you're at the till or finishing a task. Not later. Not "I'll remember." At the till.
Keep a single running list, paper or a simple sheet, with one row per job: job number, customer, invoiced total, and then the five cost columns. That's the whole database.
Once a week, sit down and do this:
Twenty minutes, once a week, and you have a live picture of every job in progress. Miss two Fridays and you're doing an hour of archaeology instead. Don't let it slide.
A bathroom re-pipe job, invoiced at £2,400.
| Cost bucket | Detail | Amount |
|---|---|---|
| Materials | Pipe, fittings, sealant, tip fee for old bath | £520 |
| Own labour | 14 hours at £42/hour loaded rate | £588 |
| Subcontractors | One day, apprentice mate, cash | £180 |
| Vehicle/trip time | 3 return trips, fuel + 2.5 hrs @ £42 | £145 |
| Permits and fees | None | £0 |
| Total cost | £1,433 |
Gross profit = £2,400 − £1,433 = £967. Gross margin = £967 ÷ £2,400 = 40%.
That's inside the normal range for a job with a fair chunk of materials in it. If the same job had been mostly labour, day-rate work, 40% would be a warning sign, not a fine result.
Once you're tracking gross profit per job, watch two numbers, because "profitable" means different things depending on the type of work.
Be honest about the limits. This spreadsheet approach won't allocate true overhead automatically, won't chase your invoices for you, and won't stop you fudging numbers if you're not disciplined about the Friday close. It also depends entirely on the job number habit; skip that and you're back to guessing. If you want the ratios and worked examples turned into something you drop numbers into rather than build from scratch, the job profitability calculator does the arithmetic for you, and the small business operations kit has templates for the weekly close if a blank spreadsheet isn't your idea of fun on a Friday afternoon.
None of this is tax or accounting advice. How you record labour costs and mileage for tax purposes is a separate question, so check the specifics with your accountant before you rely on these numbers for anything beyond deciding which jobs to quote for next.
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.