Build a simple pricing calculator for materials, labour and profit

Quick answer

List what each job costs you (material, waste, time, running costs), choose the profit you want, and let a spreadsheet do the sums. Use AI to help set up the sheet and to double-check it, never as your only calculator.

  • For: Artisans and skilled tradespeople, Freelancers and independent providers, Professionals, Retailers and walk-in businesses, Small business owners and solopreneurs
  • Level: Beginner
  • Estimated setup time: About 30 to 45 minutes for the first version (an estimate) (an estimate; yours may differ)

This playbook has no recent review date. Check tool details on the official sites before you rely on it.

The problem

Pricing jobs by feel leads to undercharging, arguments, and prices that do not follow material costs when they change. Working it out by hand each time is slow and easy to get wrong.

Before you start

  • Your current material costs, written down with the date
  • An idea of what your time is worth per hour
  • A rough share of your monthly running costs (rent, power, data, transport)
  • A free spreadsheet app (Google Sheets or a spreadsheet already on your phone or computer)

Tools you can use

  • A spreadsheet app (free options exist)
  • A free AI assistant to help design the sheet and check the formulas
  • Alternative: paper price list and a calculator

Step by step

What AI can and cannot do here

AI can suggest a sheet layout, write formulas and explain them. It can also make arithmetic errors. The spreadsheet must do the calculating, and you must check it.

Your part

You know your real costs, your time and your market. You decide the profit and the final price.

How the price is built

  1. Materials: unit cost times quantity used.
  2. Waste: a percentage added to materials for offcuts and mistakes.
  3. Labour: hours for the job times your hourly rate.
  4. Running costs: a fair share of rent, power, data and transport.
  5. Profit: the share of the price you want to keep.

Example only (not real prices; use your own currency): materials 4,000, waste 10 percent (400), labour 2 hours at 1,000 an hour (2,000), running costs 500. Total cost: 6,900. If you want a profit of 30 percent of the selling price, the price is 6,900 divided by 0.70, which is about 9,857, so you might charge 9,900. Margin (a share of the price) is not the same as markup (a share added to the cost), so decide which one you use and stay with it.

Step 1: Ask for a sheet design

Pricing sheet prompt
I run a small shop. Help me design a spreadsheet to price jobs. Columns: material cost per unit, quantity used, waste percentage, hours of labour, hourly rate, running cost share, desired profit margin percentage. Show the exact formulas for total cost and selling price, and explain each in simple words. Use these made-up numbers to test it: [paste example numbers]. Do not use any real customer information.

Step 2: Build it in your spreadsheet

Copy the layout and formulas into your spreadsheet. Make sure totals are formulas, so they update by themselves.

Step 3: Test it with a job you already priced

Enter the real costs of one past job and compare. If the sheet gives a very different answer, find out why before you use it.

Step 4: Keep your material costs up to date

Put the date next to each material cost and review them when your supplier prices change.

Step 5: Make price options

Change one input, such as paper quality or quantity, and note the new price. This gives customers a simple choice between options.

Working on a phone, with changing prices

You can build this sheet in a free spreadsheet app on your phone. Material, power and transport costs can change often, so update your price list whenever a supplier changes a price, and date it. Always keep prices in your own currency, and decide in advance how much room you have to negotiate.

Troubleshooting

If a formula shows an error, paste the formula and the error message (without private details) into the AI and ask it to explain the fix. Then test the fix yourself.

Value check

Re-price five past jobs. Note how often the old price was too low or too high compared with the sheet. Use that to decide whether to adjust your prices.

What good looks like

  • Re-price one past job with the sheet. Does the answer make sense compared with what you charged?
  • Change one material cost. Does the price move as you expect?
  • Totals are calculated by spreadsheet formulas, not typed in

Common mistakes

  • Forgetting waste and running costs
  • Mixing up markup and margin
  • Typing totals instead of using formulas
  • Not updating material costs when prices change
  • Letting the AI do the arithmetic without checking

Privacy and human review

Keep customer names and private business figures out of AI tools. Use made-up example numbers when asking the AI to design the sheet.

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