How to Price Plumbing Jobs: An Easy Formula to Create Fast Estimates
For service and repair plumbers, knowing how to estimate plumbing jobs can be the difference between a profitable job and one that costs your business money.
Whether you offer a flat rate or hourly pricing, you need to know how much to charge for your services, how to estimate time on the job, and how to factor in material costs in order to stay profitable.
In this article, we’ll walk you step-by-step through the process of pricing plumbing jobs to help you estimate jobs faster, win more residential customers, and earn more money.
Here’s how to estimate a plumbing job:
To make sure you’re turning a profit on every job, you’ll need to determine an appropriate hourly rate, then factor in material costs. Here’s how:
1. Calculate your hourly base rate
Your hourly base rate is the amount you pay yourself (or your plumbers) before you factor in overhead or material costs.
Your billable hours are how many hours in your week you can charge customers for plumbing services, installations, or repairs. This doesn’t include time spent driving to and from the job site or completing admin tasks.
To determine your hourly base rate, divide the amount of money you’d like to earn every week by the number of hours of work you can bill customers for.
Weekly earnings ÷ # of billable hours per week
For example, if you want to earn $800 per week and you can bill customers for 28 hours of work, your hourly base rate would be $28.57.
Pro Tip: To offer competitive pricing and still turn a profit, compare your hourly rates with the average rates in your state.
Average hourly rate for a plumber
In the U.S. a plumber’s average hourly rate is $22.64. But your hourly wage and annual salary will depend on where you work, how much experience you have, and your job title.
For example, apprentice plumbers earn $36,526 per year on average, while master plumbers earn on average $66,479 annually.
2. Calculate your overhead costs
Overhead costs are the operating expenses you pay to keep your business running smoothly. These could include:
- Business equipment (such as tablets, computers, or cell phones)
- Building rent
- Plumbing tools (like wrenches, plungers, or pipe cutters)
- Vehicles, fuel, and maintenance
- Taxes and business insurance
- Plumbing advertising and marketing
- Plumbing business management software
To calculate your hourly overhead costs, use the following formula:
Total monthly overhead costs ÷ # of billable hours per month
If your overhead costs for the month are $4,000 and you and your team produce 500 billable hours every month, your overhead costs would be $8.00 per hour.
Then, to calculate your overhead costs for a plumbing repair, use this formula:
Hourly overhead costs x # hours the job will take to complete
If you’re servicing a clogged drain and you estimate the job will take you two hours to complete, your overhead costs for the job will be $16.00.
3. Factor in your profit margin and calculate markup
Your profit margin is how much money you make once you’ve covered all the costs for a job—like materials, overhead costs, and employee wages.
Your markup is the take-home amount your business gets after applying your profit margin percentage to your hourly rate and overhead costs.
If your ideal profit margin is 25%, use this formula to determine your markup:
(Hourly rate + overhead costs) x 0.25
Continuing our example above, our markup would be $11.14 ($28.57 + $16 x 0.25).
FREE TOOL: Try our free profit margin calculator
4. Figure out your total labor costs
To get your total hourly rate, add your hourly base rate, overhead costs, and markup together. In our case, this would be $55.71, but we’ll round up to $56.00 per hour.
From there, determine how much time you’ll need to fix the plumbing issue and complete the job. Just multiply the expected labor hours by your hourly rate.
(# of labor hours) X (hourly rate ) = (Total Labor Costs)
If you’re servicing a clogged drain and you know it’ll take you two hours to complete, your total labor costs would be $112 (2 hours x $56 per hour).
READ MORE: How to calculate your break-even point
5. Estimate your cost of materials
For plumbing services, repairs, or installations that require extra materials—like fixtures, piping, or specialty tools—add the exact cost including taxes.
Here are some examples of materials to consider including for the following jobs:
|Service||Materials you may need|
|Water heater installation||Water heater, venting pipes, pressure valves, water and gas piping, thread compound, solder|
|Leaking pipe||Epoxy putty, pipe clamps, slip coupling, replacement pipes|
|Clogged drain||Chemical drain cleaner, plungers|
|Emergency services||Plumber’s putty, duct tape, washers|
|Burst pipe||Fittings, emery cloth, connectors|
Here’s the formula to use:
(Sum of required materials costs) X (product sales tax rate) = (Total Material Costs)
To continue our example, let’s say the cost of materials to fix a clogged drain totals $47.62 and your state’s sales tax is 5%. This would make your total material costs $50.
READ MORE: How to bid plumbing jobs and win more work
6. Add it all together
Add up your total labor costs and material costs to get the total amount of your plumbing estimate.
Or enter your labor cost, material cost, overhead expenses, and profit into Jobber’s plumbing pricing calculator.
In our case, the amount on our plumbing estimate would be $162 before taxes.
Pro Tip: Many plumbers set their minimum service times at one or two hours to account for travel time or any other hiccups along the way. This helps to keep their schedule full and jobs profitable.
Additional pricing considerations for plumbers
Before you send an estimate to a prospective customer, make sure you’ve considered any other factors that may cut into your profits.
Letting your customers know about these added expenses from the get-go can keep you from eating the costs when the job is done.
Here are a few things to consider:
- The removal of garbage and debris from the job site
- Correcting any existing plumbing code violations in old or neglected properties
- Removing or replacing any deteriorated piping
- X-raying floors or walls before cutting or drilling
- Provision of backflow prevention devices where required
- Opening, repair, or replacement of walls or ceilings required to complete work
- Time required to shut down, drain, and refill water piping, etc.
- Servicing pipes, fixtures, or equipment in hard-to-access areas
- Any job that requires a permit, like replacing drain lines or adjusting water supply lines
Always complete an on-site assessment before sending an estimate. This will give you a chance to examine pipes, assess their general condition, and determine how easy or difficult they may be to get at.
Pro Tip: To make sure your pricing is competitive, check what other plumbing contractors in your region are charging. You can check their website for pricing or try calling for a quote.
What to include in your plumbing estimate
Your plumbing estimate should include:
- Your business’s name and logo
- Your business’s contact information
- Your client’s name and contact details
- A quote or estimate number
- A breakdown of the type of service you’ll be providing, including materials and costs
- How long the estimate is valid for
- The total cost for the service, including taxes
With the correct information and a professional layout, your plumbing estimate can help you impress your clients and win more jobs.
Here’s what a plumbing estimate looks like with Jobber’s free plumbing estimate template:
Create professional plumbing estimates that win more jobs
If you’re just starting a plumbing business, mastering how to quote plumbing jobs will help you create estimates faster, win more jobs, and grow your plumbing business.
Once the job is complete, use Jobber’s free plumbing invoice template to send professional invoices in just a few clicks and get paid faster.
Originally published in March 2018. Last updated on May 18th, 2022