5 Costs Most Subs Forget in Every Bid
Most subs price materials plus labor hours and call it a bid. But if you're not loading your rate with the five costs below, you're underbidding every job and wondering why you're busy but not profitable.
1. Vehicle costs
Fuel, insurance, maintenance, depreciation. If your truck gets you to the job, it's a job cost. Most subs treat their vehicle as a personal expense. It's not. Divide your annual vehicle costs by your billable hours and add it to your loaded rate.
2. WCB / workers comp
It's a percentage of every payroll dollar. Are you including it in your labor rate? If you're quoting $45/hour for a journeyman but your WCB rate is 6.2%, your real labor cost is $47.79 before you've touched overhead. That $2.79 per hour adds up to thousands per year.
3. Small tools and consumables
Drill bits, blades, tape, PPE, connectors, sealant, wire nuts. None of them show up on a material takeoff, but they add up to thousands per year. Track your tool and consumable spend for one quarter. Divide by billable hours. You'll be surprised.
4. Unbillable time
Driving between jobs, picking up materials, doing estimates, answering emails, meeting with GCs. That time costs you money — you're paying yourself (or your crew) but not billing anyone for it. A typical sub is billable 60-70% of their working hours. If you're quoting as though you're billable 100% of the time, your rate is 30-40% too low.
5. Business overhead
Phone, liability insurance, accounting, licensing, software, office supplies, continuing education. Divide your annual overhead by your billable hours. That's your overhead rate per hour. It goes on top of your labor rate, not instead of it.
A good back-office person catches all five of these before the bid goes out. That's what Archer does — loads your real numbers into every estimate so you see your actual margins before you submit, not after you've already underbid.
If you're not sure what your fully-loaded rate actually is, that's the first thing Archer fixes.