A Contractor’s Guide to Job Costing: How to Track Profit and Price Smarter
Ever finish a job thinking it went great, only to find out you barely made a profit?
That’s the reality for many contractors who don’t have a job costing system in place. Without knowing exactly where your money goes, labor, materials, equipment, and overhead, you’re likely underpricing jobs and leaving profits on the table.
This guide will walk you through what job costing is, why it matters, and how to set it up using tools contractors already use, like QuickBooks, Pipedrive, and ClockShark.
What Is Job Costing—and Why Should Contractors Care?
Job costing is the process of tracking all costs associated with a specific project or job. That includes:
Direct labor
Materials and supplies
Equipment and rentals
Subcontractors
Overhead allocation (trucks, fuel, admin, insurance)
Without tracking this data, you’re flying blind and potentially bidding on jobs that don’t make money.
📉 The Bottom Line:
If you don’t know your cost per job, you don’t know your profit per job.
Step 1: Set Up Job Cost Codes
Start by breaking each job down into cost categories. Use standardized codes that reflect your actual work phases.
🧱 Sample Job Cost Codes (Paving Contractor):
101: Site Preparation
102: Delivery & Staging
103: Equipment Rental
104: Crew Labor
105: Final Grading & Finishing
199: Overhead & Miscellaneous
You can use spreadsheets or input these into tools like QuickBooks Online, Knowify, or Buildertrend.
Step 2: Track Labor & Materials in Real Time
Use mobile-friendly time tracking apps like ClockShark or TSheets to track labor costs to the task level.
👷 Why It Matters:
You’ll know how long each phase of a project really takes and whether you're staying within budget.
For materials:
Tie vendor receipts to job numbers
Track deliveries as they arrive
Upload documentation using field apps or Google Drive
Step 3: Use Your CRM to Track Estimates and Profitability
Your CRM isn’t just for sales—it’s an important piece of your job costing process.
With a CRM like Pipedrive, you can:
Store initial job estimates
Log expected costs
Compare estimates to final actuals
Analyze which types of jobs are most profitable
Related: How to Integrate QuickBooks with Your CRM Using Pipedrive
Step 4: Run a Post-Job Review
After every completed job, run a quick review comparing actual costs vs. estimated costs.
🔍 Ask These Questions:
Did we make the profit we expected?
Where did we go over budget—labor, materials, or both?
Did we underbid the job?
Should we adjust pricing for similar future jobs?
Pro Tip: Run these reviews as a 10–15-minute team huddle at the end of each job or during weekly review meetings.
Step 5: Use the Data to Price Smarter and Scale Profitably
Job costing isn’t about creating reports—it’s about making better decisions.
📊 Use Job Cost Data To:
Adjust future pricing based on real costs
Identify your most profitable job types
Eliminate or outsource low-margin services
Staff smarter based on actual productivity
Share margin dashboards to build team accountability
Final Thoughts
Job costing doesn’t have to be complicated—but it does have to be consistent. With the right systems in place, you’ll stop guessing and start building a business that’s both profitable and scalable.
Want Help Setting Up a Job Costing System?
Book a Free Consultation with Columbus Business Consulting
We’ll help you set up job costing tools, structure your data, and build systems that give you clarity, control, and confidence.
