Job Costing: How to Know Which Jobs Actually Make You Money

Job costing means tracking the actual labor, materials, and equipment cost of a specific job against what you billed for it — so you know whether that job made money, not just whether the invoice went out.

A busy week with a full invoice total can still include jobs that lost money. Without job costing, a profitable account and an unprofitable one look identical on the top line — the only place the difference shows up is in your actual margin, and by then it's buried in the average.

• Labor hours actually spent on the job, not the estimate

• Materials used, at their real cost

• Equipment time, including fuel and wear

• Any subcontracted work tied to that job

Compare that total against what you billed, and you have your real margin on that specific job — not a company-wide average.

You don't need a complex system on day one. Start by tagging time and materials to a job or account in whatever system you already use for scheduling, and review margin by job or account monthly. The habit of looking matters more than the sophistication of the tool at first.

You don't need a complex system on day one. Start by tagging time and materials to a job or account in whatever system you already use for scheduling, and review margin by job or account monthly. The habit of looking matters more than the sophistication of the tool at first.

• Reprice or drop the accounts that consistently run thin

• Route crews to reduce windshield time on your lowest-margin jobs

• Use your highest-margin jobs as the template for what a "good account" looks like when you're deciding where to spend on marketing

Is job costing only useful for large or commercial jobs? No — it matters just as much for residential routes, since small per-job losses add up fast across a large customer base.

How much time does job costing actually take? Once it's built into your existing scheduling and invoicing habits, it adds minutes, not hours, to your week.

What's the first sign a business needs job costing? When overall revenue is growing but margin isn't — that gap usually means some jobs are quietly subsidizing others.

Want to see which of your jobs and accounts are actually profitable?