Charge-Out Rate Calculator Australia

A charge-out rate is what you bill a customer for an hour of a worker's time. It has to cover the wage plus everything that comes with it, like super, workers' comp, insurance, leave and the hours you pay for but can't bill. Then it needs your profit on top. If your rate only covers the wage, you're working for free. Use it in every quote with NextMinute quoting.

Add up what a worker costs you in a year, divide it by the hours they actually spend on billable work, then add your markup on top. Annual cost includes wages, super, workers' comp and insurance. Billable hours are paid hours minus leave, public holidays, rain days and breaks. The calculator does this for you in a couple of minutes, so you're not wrestling a spreadsheet at smoko.

Markup is what you add on top of cost. Margin is the share of the final price that's profit. They're not the same number. A 20% markup on $60 gives you $72, but that's only a 16.7% margin. If you're aiming for a 20% margin, you need to charge $75. Mixing them up is one of the easiest ways to quote yourself out of profit without noticing.

Your labour cost is the wage plus every cost that comes with employing someone. That means super, workers' comp, insurance, annual leave, sick leave and public holidays. It also means the time you pay for but can't bill, like breaks, rained-out days and travel between jobs. Leave any of these out and the shortfall comes straight off your profit. Track real hours against them with crew timesheets.

The Superannuation Guarantee is 12% of ordinary time earnings, so it needs to be in your rate from the start. On a $38 an hour wage that's another $4.56 for every hour paid, before you've counted workers' comp or leave. It's one of the most common costs left off a quick charge-out rate, and across a crew it adds up to real money over a year.

Rain days push your charge-out rate up because you still pay the crew but can't bill anyone. The fix is to spread those days across the hours you can bill. Put a realistic number of wet days in the calculator based on your last year or two. If you don't, every wet week comes out of your margin. Good job scheduling helps you shuffle the crew when the weather turns.

Yes, the labour charge-out calculator is free. Pop in your email and you're straight in. There's nothing to install and you can run it as many times as you like for different workers or pay rates. If you want to take it further and see what labour is really costing you on each job, you can start a free trial of NextMinute.

Most trade businesses use a few charge-out rates, not one for every person. Group your crew by role, like apprentice, qualified tradie and leading hand, then run the numbers for each. That keeps quoting simple while still reflecting what each level actually costs you. Charging the same rate for an apprentice and a senior tradie usually means one of them is undercharged.

Review your charge-out rates at least once a year and any time your costs change. Award increases on 1 July, a jump in workers' comp or insurance, or a wetter year than usual are all good triggers. It only takes a few minutes in the calculator. Leaving the same rate in place for years is a slow way to lose margin.

Compare the labour you quoted with the hours the crew actually logged. NextMinute does this as the job runs. Your crew clocks hours against the job from the mobile app, and job costing shows actual labour against your quote by job and stage. You'll spot a job running over while there's still time to fix it.