Which jobs actually make you money? (simple trade audit)

Being busy and making money are not the same thing. Most trades have one job type that fills the diary and pays badly, and another that they hardly push and that pays well.

You cannot tell which is which from the bank balance. You need an hour with last quarter's jobs.

• List the last three months of jobs.
• For each: what you charged, what the materials cost, and the total hours including travel.
• Group by job type and work out what you kept per hour.
• Check how many quotes you won for each type.
• Raise the price on the worst type, or stop doing it. Promote the best.

For each job, take what you charged, subtract materials and any other direct costs, and divide by every hour it took. Include the drive, the trip to the trade counter and the quoting.

That gives you one number per job: pounds kept per hour.

Then average it by job type. It takes ten minutes with a spreadsheet, or a sheet of paper and a calculator.

Job type A is a small repair. You charge £90, materials cost £10, and it takes 2 hours with travel. You keep £40 an hour.

Job type B is an installation. You charge £650, materials cost £280, and it takes 6 hours with travel and a trade counter run. You keep about £62 an hour.

Job type C is a quoted job a long way from home. You charge £400, materials cost £150, and it takes 7 hours with two long drives. You keep about £36 an hour.

C looked like a good job on the day. It pays less than the small repair.

Count the quotes you sent for each job type and how many became jobs.

If you win nine in ten, you are probably too cheap. If you win two in ten, you are spending evenings pricing work you do not get.

A healthy rate is somewhere in between. Either extreme is telling you to change the price, or to stop quoting for that work.

Sort the same list by area. Add up the driving time for each.

Most trades find one direction that eats hours. Often it is the one with a single regular customer at the end of it.

A travel charge for that area, or one set day a week for it, fixes most of the loss.

• Best job type: put it first on your website and mention it to every customer.
• Middle: leave it alone.
• Worst: raise the price by enough to bring it up to the middle. Some customers will go, and that is the point.
• Anything you only do as a favour: decide whether it is still a favour worth doing.

Change one thing at a time and look again in three months.

• Export or write out last quarter's jobs.
• Add materials and total hours to each.
• Work out the per-hour figure by type.
• Pick one price to change and one job type to promote.

To a regular customer when a price goes up:

Hi [name], a quick note that from [date] my price for [job] will be £[amount]. I have held it for [time period], but it no longer covers the time the job takes. I would still be glad to do it for you, and I wanted you to hear it from me first.