Most service business owners don't lose money because they're bad at the work — they lose it because they quote off gut feel and never account for the full cost of doing a job. The words below are the building blocks of pricing a job profitably. Learn them once and you'll never look at a quote the same way.
Labor Burden & Burden Multiplier
The single most important concept on this page. Your true cost for an employee is always higher than their wage. On top of the base wage, you also pay payroll taxes, workers' comp, insurance, unemployment, and benefits. All of that extra cost is the labor burden.
The burden multiplier rolls it into one number. A multiplier of 1.30 means a worker truly costs you 30% more than their wage. So a $20/hour worker actually costs you $26/hour. Most service businesses run a burden somewhere between 1.20 and 1.45. If you've been quoting off the raw wage, you've been giving that 20–45% away on every single job.
Base Wage
The hourly rate you actually pay a worker — what shows up on their paycheck. This is the starting point for figuring out labor cost, not the whole story. Pricing a job off the base wage alone is the most common way service businesses underprice themselves.
Burdened (Effective) Rate per Hour
Your real, all-in cost for one hour of work — base wage × burden, then adjusted for non-billable time (see Utilization). This is the number you should actually be building quotes on. When you know your true hourly cost, you stop guessing and start pricing.
Utilization Factor
Not every paid hour is a working hour. Your crew gets paid for drive time, loading the truck, breaks, and paperwork — none of which a client pays for directly. A utilization factor of 1.15 means roughly 15% of paid hours are non-billable, so your real cost per working hour is 15% higher than it appears. Ignore this and you'll consistently quote too low.
Overtime Multiplier
The bump in pay for hours worked beyond a normal day or week — typically 1.5× the base wage ("time and a half"). If a job will push your crew into overtime, your labor cost for those hours jumps, and your quote needs to reflect it.
The Burden Components
If you'd rather build your burden multiplier from the ground up instead of estimating it, these are the pieces that add up to it:
- Payroll Tax (FICA) — the employer's share of Social Security and Medicare, 7.65% of wages.
- Workers' Compensation — insurance that covers employees injured on the job. Rates vary a lot by trade and state.
- Unemployment (FUTA/SUTA) — federal and state unemployment insurance taxes you pay as an employer.
- General Liability / Insurance — coverage that protects your business if something goes wrong on a job.
- Benefits / PTO — paid time off, health contributions, or any other benefit you offer.
- Equipment / Admin / Uniforms — the per-worker cost of outfitting and supporting each crew member.
Overhead
The cost of being in business that isn't tied to any single job — your vehicle, fuel, phone, scheduling software, advertising, office, and business insurance. These costs roll on whether you book one job a week or twenty.
Every quote has to carry a slice of overhead. If it doesn't, those costs pile up silently across the year and eat the profit you thought you were making. Overhead is usually expressed as a percentage added to the cost of each job.
Profit
What's left over after every cost — labor, materials, overhead, taxes — is covered. Profit is not a dirty word and it's not "extra." It's the reason you're in business: it lets you weather a slow month, replace a broken tool, and pay yourself. A job that merely "breaks even" paid you nothing for the risk you took.
Margin vs. Markup most confused
These sound interchangeable. They are not — and confusing them costs real money.
Markup is profit as a percentage of your cost. If a job costs you $100 and you add 30% markup, you charge $130.
Margin is profit as a percentage of the final price. To actually keep 30% of a $130 sale, you'd need to charge about $143.
So a 30% markup is really only about a 23% margin. Most people think in markup but want a margin — and end up earning less than they planned on every job. SolidScope lets you set either one explicitly so there's no guessing.
Materials
The physical supplies consumed on a job — cleaning products, mulch, sealant, hardware, packing boxes. Always priced into the quote, and worth marking up slightly to cover the time spent buying and hauling them.
Travel Fee & Mileage
The cost of getting your crew and equipment to the site. Travel fee covers the trip itself; mileage/fuel covers the distance. For jobs far outside your normal service area, these protect you from eating the cost of a long haul.
Equipment Fee
A charge for the wear, fuel, and maintenance of specialized gear a job requires — a pressure washer, a lift, a floor machine. Equipment doesn't last forever; this fee helps fund replacing it.
Disposal / Dump Fee
What it costs to haul away and properly dispose of debris, yard waste, or junk. Landfills and transfer stations charge by weight or load — pass that cost through rather than absorbing it.
Permit / Misc Fee
A catch-all for one-off costs a specific job creates — a permit, a specialty rental, a subcontractor. Anything real that doesn't fit the other buckets belongs here so it isn't forgotten.
Tax
Sales tax owed on the job, where it applies. SolidScope can either fold tax into the cost base before profit is calculated, or add it on top of the final price as a separate line — depending on how your state and your business handle it.
Add-ons
Optional extras a client can choose on top of the base service — an inside-oven clean, a soft-wash roof, packing service, hauling debris. In SolidScope you set each add-on by hours or a flat dollar amount, and it flows through your overhead and profit automatically. Listing them as their own line items also helps clients decide what to keep or cut.
Minimum Job Fee
The floor — the least you'll do any job for, regardless of size. A tiny job still costs you a trip, setup, and admin. Without a minimum, small jobs can actually lose money. The minimum makes sure even quick work is worth your while.
Deposit
A portion of the total collected up front, before work begins — often 25%. Deposits protect you on larger jobs: they cover your initial material costs and confirm the client is serious. The balance is due on completion.
Pricing Tiers (Low / Standard / Premium)
Three versions of the same quote at different profit levels. Low is your competitive floor for price-sensitive work. Standard is your target. Premium is for when you're busy, the job is a hassle, or the client clearly values quality over price. Seeing all three side by side lets you position a quote with confidence instead of pulling a number out of the air.
Pre-Profit Cost
Everything a job costs you — labor, materials, fees, and overhead — before any profit is added. It's the break-even point. Whatever you charge above this is your profit; anything below it means you paid to do the job. (This appears on your internal cost sheet, never on the client's proposal.)
Stop guessing. Start pricing.
SolidScope does all this math for you — burden, utilization, overhead, margin — and turns it into a clean proposal you can hand a client in one click.
Try the calculator free