How Do I Price My General Contractor Services?
- Nate Jones, CPCU, ARM, CLCS, AU
- Sep 17
- 3 min read
If you're starting or growing a general contractor business, one of the most important questions you'll face is: How do I price my services profitably and competitively? Whether you're bidding on residential remodels, commercial builds, or industrial projects, your pricing strategy can make or break your business.
In this guide, we’ll walk you through how to price your general contractor services, including labor, materials, overhead, permits, profit margins, and more. Plus, we’ll show you how to protect your business with the right general contractor insurance from Wexford Insurance.
Why Pricing Matters for General Contractors
Pricing isn’t just about covering costs—it’s about positioning your business competitively while ensuring profitability. Whether you're managing residential remodels, commercial builds, or industrial projects, your pricing strategy should reflect:
Labor and material costs
Overhead and permit fees
Profit margins
Market competition
Value-added services
Step-by-Step Guide to Pricing Your General Contractor Services
1. Calculate Labor Costs
Start by estimating the total hours required for the job and multiply by your crew’s hourly rates. Include:
Wages
Payroll taxes
Benefits
Overtime
Your own time as a project manager
2. Estimate Material Costs
List all materials needed for the job, including:
Lumber, concrete, drywall, etc.
Delivery fees
Waste and overage buffer
🔗 Read More: Track Construction material prices
3. Factor in Overhead
Overhead includes your ongoing business expenses:
Office rent
Software and tools
Fuel and vehicle maintenance
Marketing and advertising
Insurance premiums
Divide your monthly overhead by the number of jobs to allocate a portion to each project.
4. Include Permits and Compliance Costs
Depending on your location and project type, you may need:
Building permits
Environmental fees
Inspection costs
Licensing fees
5. Add a Profit Margin
Once you’ve calculated total costs, add a profit margin—typically between 10% and 25%. This ensures your business remains profitable and scalable.
📈 Pro Tip: Higher-risk or complex projects should carry a higher margin.
6. Research Competitive Pricing
Look at what other general contractors in your area are charging. While you don’t want to undercut yourself, staying competitive is key to winning bids.
7. Consider Value-Based Pricing
If you offer premium craftsmanship, fast turnaround, or specialized services, you can charge more. Clients often pay extra for:
Reliability
Communication
Project management
Safety and compliance
8. Use Estimating Software
Invest in tools like Buildertrend, CoConstruct, or Jobber to streamline your bidding process and reduce errors.
Don’t Forget to Include Insurance Costs
Insurance is a critical part of your pricing strategy. It protects your business, your clients, and your reputation. At Wexford Insurance, we help general contractors find the right coverage, including:
Protects against property damage and bodily injury claims.
Covers your work vehicles and drivers.
Protects your office, tools, and equipment.
Required if you have employees; covers workplace injuries.
Covers theft, damage, or breakdown of tools and machinery.
Final Thoughts
Pricing your general contractor services is both an art and a science. By understanding your costs, researching your market, and factoring in insurance, you’ll be better positioned to win jobs, grow your business, and protect your assets.
At Wexford Insurance, we’re here to support your journey with specialized insurance programs designed for general contractors. Whether you're just starting out or scaling up, we’ll help you build a safer, more profitable business.
🛡️ Need help finding the right insurance for your general contracting business?
