What Is Gross Margin per Job?
Gross margin per job is what a job leaves after the costs of doing it. Say which costs you mean: parts and card fees only, or the sub's cut too. The two answers can be 78% and 39%.
Gross Margin per Job, Worked
Example
Made-up numbers. A job totals $1,800, paid by card with a $54 fee. Parts were $350. Job profit: 1,800 minus 54 minus 350 is $1,396. As a share of the job, 1,396 divided by 1,800 is about 78%. Your sub is paid 50% of profit, $698. What you keep is $698, or about 39% of the job.
Same job, two numbers. In HeadHoncho the first is the job's gross profit: what is left after parts and card fees. The second is the company's share, what is left after the cut as well. When someone says "margin", ask which one they mean.
How It Is Usually Miscounted
- The card fee is forgotten. It never appears on the invoice, but it is not yours.
- Parts the sub bought are left off. You hand them back to him, so they are a cost.
- The cut is taken from the wrong base. A percent of the total and a percent of the profit differ.
- Ads are not counted. Many owners take them off the month, not the job.
Related Terms
Cost per Lead, 1099 Subcontractor.
The step by step, with the ads added, is in How to Work Out Your Cost per Booked Job, and the sub's side is in How to Pay a Subcontractor on a Split.