A job price can look reasonable and still be built on incomplete cost assumptions.

Use this worksheet to review one construction job or estimate. Work through the price, expected direct job costs, gross profit, and gross margin, then identify the assumptions that deserve a closer look before you decide whether the job is priced appropriately.

This worksheet is designed to help you investigate your pricing—not prescribe a universal markup, margin, or price.

Choose one job, proposal, or estimate. Use the best information currently available rather than trying to make the numbers look ideal.

The purpose is to understand what your price is built on and where additional information may be needed.

Your expected gross profit depends on the direct costs required to complete the job. Review the major costs that belong directly to this project.

Use estimates when actual costs are not yet available, but note where an estimate is uncertain or incomplete.

Now compare the job price with the direct costs you expect to incur.

Gross profit is the amount left after direct job costs are subtracted from job revenue. Gross margin expresses that gross profit as a percentage of revenue.

These numbers help you understand what the current price is expected to produce. They do not, by themselves, prove that the price is right for your business.

A price is only as useful as the assumptions behind it. Review the inputs you used before relying on the expected profit or margin.

Expected profit can change even when the customer price does not.

Think about the cost assumptions with the most uncertainty. If labor takes longer, material prices change, subcontractor costs increase, or another direct cost was underestimated, the gross profit expected from the job can change too.

Markup and margin can help you evaluate a price, but a percentage should not be used without understanding the costs and assumptions behind it.

Two jobs can show similar percentages while carrying different labor requirements, cost uncertainty, scope risk, or other financial considerations. The useful question is not simply whether a percentage looks good. It is whether the financial information behind the price is reliable enough to support your decision.

Use what you found above to identify the part of the price that deserves more investigation.

The goal of this worksheet is not to produce a universal “right price.”

It is to make the financial assumptions behind your price more visible. When you can see the expected costs, gross profit, gross margin, and areas of uncertainty together, you are in a better position to ask the right questions before making a pricing decision.

If the worksheet exposes missing or unreliable information, that is useful information too. It tells you what needs to be investigated before you rely on the price.