How to Know If Your Jobs Are Actually Making You Money

For most UK trade contractors — decorators, plumbers, electricians, builders, roofers — the moment of truth comes at the end of a job. You pack your kit, you send the invoice, and somewhere in the back of your mind you’re wondering: did I actually make money on that one?

The honest answer is usually: not as much as you think.

Here’s how it works. You price the job, you win it, you crack on. Job’s done, you send the invoice, money comes in. But what actually happened in between? How many hours did your lads put in? What did materials cost? Did that extra bit of work eat into your margin?

Most trade contractors couldn’t tell you. Not because they’re bad at running a business — but because nobody ever set up a proper way to track it. It happens to plumbers, electricians, builders, decorators, roofers — every trade. The job feels busy, the team’s working hard, but the money isn’t there at the end.

The three numbers every UK trade contractor needs to know

Job profitability in the trades comes down to three numbers. Every trade business owner — whether you’re a one-man-band or running a team of ten — should know these for every active job, every single week.

Contract value is simple — what the client’s paying you. This is your starting point.

Direct cost is everything it took to do the job. Labour, materials, plant hire, subbies. Every pound that came out of your pocket to get the work done.

Gross profit percentage is the one that tells you the truth. It’s the gap between what you charged and what it cost you, expressed as a percentage. This is your job profitability margin — the number that actually tells you whether a job was worth taking on.

A healthy job for most UK trade contractors sits somewhere between 30 and 40 percent gross profit. Below 30 and you’re working hard for not much. Below 20 and you might as well have stayed home. Above 40 and you’re pricing your work correctly and controlling your costs — that’s the target.

The problem is most contractors only find out that number when they sit down with their accountant at year end. By then it’s too late to do anything about it.

Why jobs go wrong without you noticing

Job profitability problems rarely come from one big mistake. It’s always a load of small things that add up — and none of them feel catastrophic at the time.

Your lads spend an extra day on site because the job was in worse shape than you quoted. You need extra materials at short notice — small cost, but it wasn’t in the original quote. A variation gets done and forgotten about, never invoiced. Your subbies take longer than planned and you’re paying day rate. The site’s not ready when it should be and your team’s standing around.

Add those up across a six-week job on a commercial contract and you could be looking at a gross profit margin that’s half what you expected. A job you thought was making you 35% ends up at 17% — and you’re none the wiser until the accountant tells you at year end.

What proper job costing looks like for trade contractors

Tracking job profitability doesn’t require a complicated system. But it does require consistent data. Every UK trade contractor running more than two or three active jobs needs to know, job by job, week by week:

Labour cost to date. How many hours have gone into this job and what did they cost? If you’ve got employed staff, that’s their pay rate multiplied by hours worked. If you’re using self-employed subbies, it’s what you’re paying them.

Materials cost to date. What’s been bought for this job and approved? Every supplier invoice that relates to this project should be matched against it.

Earned value versus invoiced. This is the important one. If you’re 60 percent through a job based on progress, but you’ve only invoiced 30 percent of the contract value — you’ve got a cashflow problem coming. Good job management software for contractors shows you this in real time, not at the end.

What a profitable job looks like — and what a problem job looks like

A job that’s going well looks like this. Labour costs are tracking close to what you quoted. Materials are being matched to the job as they’re bought. Your gross profit percentage is holding above 30 percent. You’re invoicing in line with progress so cash is coming in as work goes out.

A job that’s going wrong looks like this. Hours are creeping up week on week. Materials aren’t being properly tracked or matched to the job. Your margin is eroding quietly and you won’t know how bad it is until you send the final invoice and add it all up.

The difference between the two isn’t luck, or experience, or even the type of work you do. It’s visibility. Contractors who track job costs in real time catch problems early and act on them. Those who don’t find out when it’s too late to do anything.

The bottom line for UK trade contractors

You don’t need complicated software or a part-time bookkeeper looking over your shoulder every week. You need to know your gross profit on every active job, every week, while the job is still running.

If you can see your job profitability margin while a job’s still on — you can do something about it. Chase a variation. Tighten up on materials. Have a conversation with the lads about hours. Raise an additional invoice if scope has crept.

If you only find out at the end — you can’t.

That’s what Grafter Lab was built to fix. Job management and financial intelligence software built specifically for UK trade contractors. See your gross profit on every job in real time, track labour and materials against your budget, and know exactly where every job stands — without waiting for your accountant.