Why does labour blow out wipe out profit first?
When you price a job, your profit sits on top of your costs. Labour is the cost most likely to move on you mid-job, and when it does, it eats into profit before anything else. If your margin is 20% and your team spends 20% more time than you allowed, that margin is gone entirely. Spend any more than that and the job is now losing money.
Materials are easier to control because you can see what you pulled from the wholesaler. Labour is harder because the hours just accumulate quietly on site until it is too late to act.
How do you track whether a job made money?
Compare the time you allowed when you priced the job against the actual time spent on site. This is your job productivity figure. The formula Greg uses is: billable hours divided by actual hours on site, multiplied by 100. That percentage tells you whether your team finished the job in the time you priced for, faster, or slower.
If you are consistently going over budget on time across multiple jobs, that is a signal your pricing does not have enough time built into it. Fix the pricing, not just the team.
Why should you price for an average person, not yourself?
A lot of trade business owners price as if they will be doing the work themselves. The problem is your employees will not work at your pace or with your attitude, and they never will. If you price based on how fast you can do it, every job your team touches will run over time and drain your margin.
Price for an average person to complete the work. When you hire someone who is faster, you get extra profit. When you hire someone average, you still make profit. This also means you can coach your team from a position of confidence rather than stress, because the pricing already accounts for a normal pace.
What should you check before sending every invoice?
Before the invoice goes out, check whether everything that was done on site has been captured. Variations and extras are missed constantly. The team does the work, spends the labour and materials, but it never makes it onto the invoice.
If the scope changed on site, that conversation needs to happen with the customer early, not after the fact. Get approval for the extra work before it is done, explain the reason, and quote the additional cost. If the job was done correctly and a call-back is still requested, charge for your time. It is your business and your family's money.
How do you track daily billable hours across the whole day?
Job productivity tells you how a single job performed. Day productivity tells you whether the whole day was profitable. Add up all the billable hours across every job in the day, divide by the total hours you paid your team for, and multiply by 100.
Things that pull this number down include poor scheduling with long travel between jobs, waiting on stock, starting late, finishing early, and extended breaks. Scheduling jobs close together and minimising non-billable travel time has a direct impact on whether the day makes money.
Why do business owners end up not knowing any of this is happening?
When you are on the tools all day or buried in admin, you have no time to look at what the numbers are telling you. Greg describes this as the reactive state: you are so consumed by what is in front of you that you cannot make the small, daily improvements that would compound into real growth.
Closing off your profit and loss every month, with all labour and materials matched to what was invoiced and purchased, gives you accurate data. That data lets you drill into each day and each job to find out why it was profitable or not. Without that awareness, you cannot make changes, and working harder without changing anything is not a path forward.
