New contractors often ask how to estimate jobs. The following formula applies to any kind of painting job—interior or exterior, large or small, commercial or residential:

Total price = (((Overhead per man hour) + (Average wage + labor burden)) X Man hours) + (Materials + Material markup) + (Other expenses + markup) + Profit

While the above formula might look a little intimidating, it really isn’t that complicated. However, it does require that you know certain things about your business and your painters. Let’s look at the formula in a little more detail.

Overhead per man hour—this is the total of your overhead for a period (either monthly or annually) divided by the anticipated hours to be worked in the same period. This allows for overhead recovery during each man hour worked. (And don’t bother telling me you don’t have any overhead. You do.)

Average wage + labor burden—this is the average that you pay for wages, taxes, holidays, etc. on an hourly basis.

Man hours—the total man hours involved in the job. How to make that calculation is beyond the scope of this post.

Materials + material markup—the cost of your materials for the job plus your markup on those materials. You are marking up your materials, aren’t you?

Other expenses + markup—expenses such as scaffolding, equipment rental, etc. are included in this item.

Profit—this is what you want left over after everything is paid.

So there it is—one simple formula for calculating the price on any job. If you don’t know how to calculate some of these items, there are formulas for that as well. But if I shared everything in one post, what else would I have to write about?