1. Build the fixed cost for one quote
Owner labor = (service hours + job-specific nonbillable hours) × owner pay target per hour. The owner pay target represents a labor cost assumption, so it is not counted again as profit.
Other labor = helper hours × full helper cost per hour + subcontractor quotes. Then add direct materials, travel, equipment allocation, allocated overhead, other fixed job costs, and fixed transaction fees.
Fixed cost (C) = owner labor + other labor + materials + travel + equipment + overhead + other fixed cost + fixed transaction fees.
2. Account for fees charged on the quote
Only payment or platform fees that are truly calculated as a percentage of this quote enter the percentage fee rate (F). A fixed per-transaction charge belongs in fixed cost. If a fee is charged on tax, tips, or another basis, this formula may need adjustment.
3. Calculate cost coverage and target price
Cost-covering price = C ÷ (1 − F).
Exact minimum target price = C ÷ (1 − F − target margin).
Operating profit at a price P = P × (1 − F) − C.
Margin at P = operating profit ÷ P. Markup on cost = operating profit ÷ C, when C is greater than zero.
The target margin and percentage fees together must be less than 100%. The tool rounds the exact target up to the next cent, then offers a further upward rounding step for a practical quote. The suggested amount is never labeled a market rate.
A small reproducible example
If fixed cost is $70 and target margin is 30% with no percentage fee, the target price is $70 ÷ 0.70 = $100. At $100, operating profit is $30: a 30% margin and a 42.86% markup on cost. With a 3% fee on the quoted amount, the target becomes $70 ÷ 0.67 = $104.48 after rounding up to the cent.
Units, packages, and scenarios
The calculator first prices the entire job or package. It shows a unit equivalent only when you enter a positive billable unit count. For a four-visit package, all four visits’ time and cost belong in the package total before division by four.
Low and high scenarios require you to enter total owner hours and materials cost for each case. These are planning scenarios you supply, not confidence intervals or observed market ranges. Other costs stay as entered in the main quote unless you change them there.
Data and source boundary
All default amounts on this site are labeled illustrative assumptions and can be edited. They are designed to demonstrate the formula and industry-specific scope, not to report average US prices. We do not use US Bureau of Labor Statistics employee wage statistics to produce a self-employed service quote. The BLS OEWS FAQ explains that its employment estimates exclude self-employed workers.
No external market-rate feed, location lookup, tax calculation, or legal rule is applied to the result. Tax, permits, insurance, discounts, refunds, and special fee bases require your own review. The site does not provide tax, legal, medical, or professional licensing advice.
Corrections and updates
Method and page examples were prepared on 2026-11-06. The examples are arithmetic checks, not field observations. We update a page when a substantive correction is made and change its sitemap date accordingly. To report a problem, email [email protected].