Charge-out rate calculator

How much should you charge per hour? Work out the rate and job prices your service business needs, from what you want to earn, what the business costs to run, and how many hours you can actually bill.

Currency

1. What you need to earn

Take-home pay per yearWhat you want to pay yourselfUSDBusiness costs per yearVehicle, fuel, insurance, tools, phone, software…USDProfit marginBuffer for growth and slow months%

2. How much you work

Hours per weekWeeks per yearAfter holidaysBillable timeNot quoting, admin, travel%

3. Price a typical job

Hours on the jobhrsTravel timehrsMaterialsUSD

Your minimum hourly rate

$78

Based on 1,288 billable hours a year and $100,000 of revenue needed.

Typical job price

$292

3.5 hrs × $78 + $20 materials

Put these prices on your website

Quotewise turns your rates into a quote form. Customers see their price straight away, and you get their details and the job.

What a charge-out rate is

Your charge-out rate is what you bill a customer for an hour of work. It isn't your wage. It has to pay you, cover what the business costs to run (insurance, fuel, tools, software, your accountant) and leave something over, all spread across the hours you can bill. Tradespeople in Australia, New Zealand and the UK usually call it a charge-out rate. Everyone else calls it an hourly rate. It's the same number.

How this calculator works

Your rate has to cover three things: what you pay yourself, what the business costs to run, and a margin for growth, quiet months and surprises. Divide that by the hours you can actually bill, not the hours you work. Quoting, driving, invoicing and chasing payments all take time you can't charge for directly, which is why most service businesses bill only 60–80% of their working hours.

Common pricing mistakes

Pricing from what competitors charge without checking it covers your own costs.
Forgetting travel time, call-out costs and materials on small jobs. Set a minimum job price.
Not charging more for harder jobs (height, access, condition). Use surcharges.
Giving recurring customers a discount without adjusting for the time you save.

Turning your rate into quotes customers can see

Once you know your numbers, put them on your website. A quote calculator applies your rates, minimums and surcharges the same way every time, and sends you requests with the job details filled in.