Pricing is the thing nobody teaches you. You can spend four years on an apprenticeship learning your trade inside out, and at no point does anyone sit you down and say, "Right, here's how to actually work out what to charge."
So most tradespeople do what feels natural: they look at what other people charge, pick a number that doesn't feel too greedy, and hope for the best. It works - until it doesn't. Until you're three months into self-employment and wondering why you're working harder than ever but your bank account tells a different story.
Let's fix that.
The most common pricing mistakes
1. Pricing by gut feel "That looks like a day's work, so I'll charge my day rate." The problem with gut feel is that it doesn't account for the two hours you spent quoting, the 45 minutes stuck in traffic, the trip to the merchants, or the customer who calls you back a week later because they've changed their mind about the taps.
2. Copying the competition Checking what other local tradespeople charge seems sensible, but you don't know their overheads, their efficiency, or whether they're actually making money. The bloke charging £150 a day might be running at a loss and just doesn't know it yet.
3. Forgetting your overheads Your hourly rate isn't what you take home. It has to cover your van, fuel, insurance, tools, materials, phone, accounting fees, certifications, and - critically - the days you spend doing admin, quoting, and marketing. If you're only earning money 60% of the time, your chargeable rate needs to cover the other 40% too.
4. Not charging for the quote Site visits take time, fuel, and expertise. If you're spending an hour driving to a job, 30 minutes assessing the work, and then an hour writing up a detailed quote - that's 2.5 hours of unpaid work. If the customer gets three quotes and picks someone else, you've just worked half a day for free.
5. Undercharging to win work The race to the bottom is a race nobody wins. Customers who choose purely on price are also the most likely to be difficult, haggle on extras, and leave you a bad review if anything isn't perfect. Quality customers expect to pay a fair price and value reliability and professionalism over saving £50.
How to calculate your actual rate
Here's a straightforward method to work out what you need to charge. Grab a calculator - this takes five minutes and could change your business.
Step 1: Work out your annual costs
Add up everything you spend to run your business in a year:
| Item | Example annual cost |
|---|---|
| Van (lease/finance + tax + MOT) | £4,800 |
| Fuel | £3,600 |
| Insurance (van + public liability + professional indemnity) | £2,400 |
| Tools and equipment | £1,200 |
| Phone and software | £600 |
| Accountant | £800 |
| Certifications and training | £500 |
| Marketing and website | £400 |
| Clothing and PPE | £300 |
| Misc (parking, materials you absorb, etc.) | £1,200 |
| Total overheads | £15,800 |
Step 2: Decide what you want to take home
Be honest with yourself. If you want to take home £45,000 after tax, you'll need to earn roughly £55,000-£60,000 gross (depending on your tax situation). Let's say £57,000.
Step 3: Add it up
£57,000 (gross income) + £15,800 (overheads) = £72,800 total revenue needed.
Step 4: Work out your chargeable days
There are 260 working days in a year. But you won't be on paid jobs every day:
- Holidays: 25 days
- Bank holidays: 8 days
- Sick days: 5 days
- Admin/quoting/marketing: 40 days (yes, really)
- Quiet periods: 10 days
That leaves about 172 chargeable days.
Step 5: Calculate your day rate
£72,800 / 172 = £423 per day, or roughly £53 per hour on an 8-hour day.
If you've been charging £200-£250 a day, you can see the problem immediately. You're working for less than you think.
Fixed price vs day rate - which is better?
Both have their place:
Day rate works well when:
- The scope is unclear or likely to change
- It's maintenance or reactive work
- You're working on a larger project with ongoing requirements
Fixed price works well when:
- You know exactly what's involved
- The customer wants certainty
- You've done similar jobs before and can estimate accurately
The golden rule with fixed pricing: always add a contingency. A 10-15% buffer covers the unexpected - because in the trades, there's always something unexpected.
Presenting your prices professionally
How you present your price matters almost as much as the price itself. A professional, itemised quote gives the customer confidence that you know what you're doing and that the price is fair.
Include:
- A clear breakdown of labour and materials
- Your terms and conditions
- A validity period (14-30 days is standard)
- Your business details, insurance info, and any relevant certifications
Tools like traidhand let you build professional quotes with line items, VAT calculations, and your branding in minutes. The AI can even draft a quote for you based on your conversation with the customer, matching items to your service catalogue at your exact prices. Customers can accept online with one click - no more waiting for a text back saying "yeah go on then."
Don't forget to review regularly
Your costs go up every year - fuel, insurance, materials, the lot. If you haven't raised your prices in two years, you've effectively given yourself a pay cut. Review your rates every six months and adjust accordingly. Your loyal customers will understand; the ones who leave over a 5% increase weren't your best customers anyway.
Want to stop guessing and start quoting with confidence? Try traidhand free and build professional quotes that win work.