KeyPlusCONFIDENTIAL · INTERNAL BRIEFING

See the
whole job.

A practical guide for the KPFS office team: price the whole job, protect the time and make informed decisions.

Use this job to understand what our price needs to cover before we quote, order or commit further resources.

Thanks to Tom for bringing the equipment and time figures together.

Follow the job ↓
Money figures exclude VAT unless an optional calculator input explicitly says otherwise. One person-day means one person working eight hours. Two people working for five days equals ten person-days.

What you will take away

Purchase cost: what we pay a supplier or contractor. Selling price: what we charge the customer. Profit: what remains after the relevant costs are covered.

01 / THIS JOB

What did the charge have to cover?

From the £10,657.00 customer charge, equipment cost £3,878.52 and the contractor cost £1,963.87. Together those purchases total £5,842.39. The remaining £4,814.61 had to cover people’s time, other expenses and company running costs before any profit.

Ten person-days in total

Eight days were identified as billable. Two were spent waiting for Akuvox MAC-address transfers.

Time spent waiting still uses people and resources.

What did the delay mean in pounds?

The two waiting person-days used £1,040 of labour selling capacity at our standard rate: 2 person-days × 8 hours × £65. The delay reduced the team’s availability for other work.

This time is already included in the £5,200 labour selling value for all ten person-days. Count it once. Selling capacity is not the same as lost profit or a confirmed additional invoice.

The hourly rate helps pay for the whole business.

£65 is our selling rate per person, not the engineer’s wage. It supports the weekly company cost pot and a contribution to profit.

THE WEEKLY COMPANY EXPENSE POT
PeoplePremisesOffice supportVehiclesTools & systemsInsurance
The whole business.

Every available labour hour helps cover this pot.

How does this work?

Spread the cost across available hours

CWeekly cost pot allocated to labour
HAvailable revenue-earning labour hours

Cost to recover per labour hour
before any profit allowance

Cost recovery per hour
+ contribution to profit
= required hourly selling rate

£65 is our current standard selling rate. Actual weekly costs and available hours are needed to test whether it is sufficient.

Available hours are not the same as paid hours.

Allow for holidays, sickness, training, internal meetings and travel or administration that cannot be billed. Fewer hours available to sell means more company cost must be recovered from each remaining hour.

Equipment and contractor markups contribute to company costs too. A full pricing model accounts for those contributions once and agrees the share labour must recover; it does not allocate the same cost twice.

See the company costs that need covering

People and employer costs

Engineers’ wages, employer National Insurance, pension contributions, paid leave, sickness cover, recruitment, vetting, training and development. Include paid leave in the employment-cost basis once.

Premises

Rent, business rates, electricity, gas, water, cleaning, waste disposal, premises maintenance and security.

Support staff and management

Office staff, scheduling, technical support, supervisors and managers, administration, purchasing, customer service, invoicing and credit control.

Vans and travel

Vehicle leases or depreciation, finance costs where applicable, fuel, servicing, repairs, tyres, MOTs, vehicle tax, breakdown cover and fleet insurance.

Tools, systems and compliance

Tools and test equipment, calibration, PPE, workwear, consumables, phones, broadband, software, IT support, accreditations, audits and compliance.

Company insurances and business support

Employers’ liability, public liability, professional indemnity and other relevant company cover; accountancy, legal and banking fees, marketing, and an appropriate allowance for warranty work, callbacks and bad debts.

These are cost categories to check against the accounts, not additional job costs to add automatically. Record job-specific time and expenses separately, reconcile them with the overhead allocation, and avoid double-counting.

How our usual pricing approach works
QUOTATION PRICING · EX VAT

Equipment

Our usual equipment pricing at the time of quoting used a 25% markup on top of purchase prices.

Purchase cost
£3,878.52
25% markup
£969.63
Selling price
£4,848.15

£3,878.52 × 1.25 = £4,848.15 excluding VAT.

QUOTATION PRICING · EX VAT

Third party contractor(s)

The external contractor excavated and concreted the gate-pole base. A 25% markup covers arranging, organising and dealing with the contractor.

Contractor cost
£1,963.87
25% markup
£490.97
Selling price
£2,454.84

£1,963.87 × 1.25 = £2,454.84 excluding VAT, rounded to the nearest penny.

SELLING VALUE · EX VAT

KeyPlus labour

10 person-days in total × 8 hours × £65 per person per hour. This is total people’s time, not ten calendar days with multiple engineers.

Total site time
80 hours
Hourly selling rate
£65.00
Labour selling value
£5,200.00

80 hours × £65 = £5,200 excluding VAT. £65 is our selling rate, not the engineer’s wage.

See what the £65 rate must cover

We pay out before we are paid. Our markup also helps cover the financing costs and cash-flow pressure of paying suppliers and contractors before customer payment arrives.

These cards show the usual 25% markup approach described in the briefing, applied retrospectively to the reported site time. They do not verify how the original quotation was built. Markup contributes towards handling, company costs, funding and profit; those costs must only be allocated once.

02 / BUILD THE PRICE

Build a price for the whole job.

Start with purchase costs, add the relevant markups and allow for the people’s time needed to deliver the agreed scope.

RETROSPECTIVE WORKED EXAMPLE · EXCLUDING VAT

Usual 25% markups + 10 reported person-days

This illustration applies the usual pricing approach described in the briefing to the reported site time.

Equipment£3,878.52 + 25% markup
£4,848.15
Third party contractor£1,963.87 + 25% markup
£2,454.84
KeyPlus site labour10 person-days × 8 hours × £65
£5,200.00
Illustrative selling priceEach line rounded to pennies, then added
£12,502.99
Reported customer charge
£10,657.00
Difference between selling prices£12,502.99 − £10,657.00
£1,845.99

£1,845.99 is a selling-price difference, not a proven loss or lost profit. Additional time and expenses remain unquantified. The original quotation and agreed scope have not been reconciled to these figures.

This is not a verified original quotation, a complete final price or an amount we can retrospectively invoice. It does not mean every actual overrun could have been predicted or charged.

For the next quotation: forecast the agreed scope realistically, record clear assumptions and include a suitable, explained allowance for risk.

Change the inputs. See the selling price.

Try a pricing scenario below. The standard rate stays at £65 per hour × 8 hours = £520 per person-day. All results exclude VAT.

The earlier assumption gives £10,130.86. It is an unverified reconstruction and does not reconcile to the reported £10,657.00 customer charge.

WORKED EXAMPLE · PRICING SCENARIO · EX VAT

Equipment + contractor + time

Equipment +25%
£4,848.15
Contractor +25%
£2,454.84
10 person-days × £520
£5,200.00
Scenario selling price · ex VAT
£12,502.99
Compared with the reported £10,657.00 charge£1,845.99 above

A difference between selling prices, not actual profit or loss.

EquipmentContractorLabour

Changing this scenario does not change the actual invoice. Additional time and expenses remain unquantified; this is not a complete final price or an actual profit calculation.

Your pricing choices

Both markup sliders move in 5% steps.

Added to the £3,878.52 equipment purchase cost.

Added to the £1,963.87 contractor purchase cost.

£520 per person-day: 8 hours × £65 per person.

See the scenario calculation
03 / NEXT-JOB CHECKLIST

Before we commit, check the whole job.

A proposed working process for the office team and colleagues delivering the work. Roles below are responsibilities to agree internally, not a new formal approval policy.

Keep the evidence with the job in Uptick where the existing setup supports it.

01 Before quoting

  1. Confirm the technical scope

    Technical lead or estimator

    Confirm requirements, specification, compatibility, site conditions and readiness. Check connectivity, power, access, third-party permissions and account or device transfers.

    Record: agreed scope, assumptions, exclusions, dependencies and unresolved questions.

  2. Check purchases and contractors

    Office or purchasing coordinator

    Confirm quantities, current supplier prices, availability, delivery charges and lead times. Obtain a clear contractor quotation with scope, exclusions and responsibilities.

    Record: equipment list, supplier prices, availability and the contractor quotation.

  3. Allow for the whole delivery

    Estimator with office support

    Include preparation, configuration, travel, installation, commissioning, testing, handover and foreseeable return visits. Allow for accommodation, meals, access equipment, delivery and other job-specific expenses.

    Record: time and expense allowances, pricing approach and a suitable, explained contingency.

  4. Review before issuing the quote

    Authorised manager

    Review the scope, pricing assumptions and commercial risks. Approve discounts or departures from standard pricing before the quotation is issued.

    Record: the review, any departures and the approval under existing arrangements.

02 Before ordering or attending

  1. Check that we are ready to proceed

    Office coordinator with the technical lead

    Confirm customer acceptance, relevant payment arrangements, equipment readiness, site access and technical dependencies. Resolve known blockers before dispatching engineers wherever possible.

    Record: accepted scope, payment arrangements, readiness checks and any outstanding blocker with an agreed next step.

03 During the job

  1. Capture what actually happened

    Engineers

    Record actual time, work completed, materials, delays and supporting notes accurately in Uptick.

    Record: time entries, materials, progress and the cause and duration of delays.

  2. Review, escalate and agree changes

    Office coordinator or technical lead

    Review progress against the allowance. Escalate blockers promptly, agree the next step and keep the customer informed. Obtain internal authorisation and customer agreement for chargeable variations before committing more resources wherever practicable.

    Record: progress, customer updates, agreed variations and authorisation. If urgent action is needed, escalate and record the decision promptly.

04 After completion

  1. Close the job and learn from it

    Office and responsible manager

    Confirm completion, commissioning and handover records. Reconcile materials, contractor invoices, labour, expenses and approved variations. Invoice the agreed work and review estimated versus actual performance.

    Record: completion evidence, reconciled costs, agreed invoice and lessons for future quotations.

CUSTOMER CONFIDENCE

Keeping the customer informed is part of the job.

Charlotte’s obvious frustration with poor communication, repeated delays and unfinished work reflects the gap between what we promised and what we delivered. This has damaged her confidence in KeyPlus and is likely to shape her view of us for a long time, even after the installation is finished.

Finishing the work does not immediately repair the relationship. Brian and Neil have had to become involved. Rebuilding trust means communicating clearly, making realistic commitments and consistently doing what we say over time. Future work and recommendations may be affected; that impact has not been quantified.

Unrecorded does not mean free
  • Brian and James’s initial assessment visit: two members of the senior leadership team, half a day each, travelling time, two vehicles and associated running costs.
  • Hotel accommodation, food and travel for two nights.
  • James’s additional visit.
  • Brian’s time managing the customer relationship on at least four occasions.
  • Office work selecting the correct equipment, ordering and handling returns or replacements.

These items are not yet fully recorded; that does not mean zero cost. Exclude any visits, hours or expenses already included elsewhere.

All relevant costs need recovery through overall pricing. Whether an item can be charged separately depends on the customer’s agreed scope and any approved variation; recording a cost does not automatically make it chargeable.

OPTIONAL / SUPPORTING DETAIL

Look closer at the figures.

The mixed benchmark below is separate from the illustrative selling price. It leaves equipment and contractor markups out.

Understand the original mixed benchmark

Ten person-days × £520 = £5,200 of labour selling value. Equipment and contractor purchase costs plus that labour value give a comparison of £11,042.39.

£10,657.00 customer charge£11,042.39 comparison= −£385.39

The customer charge is £385.39 below this comparison. This mixes purchase costs with labour selling value and excludes equipment and contractor markups. £385.39 is not an established job loss. This is not a complete quotation or a profit calculation. The separate worked example includes both 25% markups and totals £12,502.99 before unquantified time and expenses.

Show the exact calculation
Original mixed benchmark · excluding VAT
Equipment purchase cost£3,878.52
Contractor purchase cost£1,963.87
Ten person-days × 8 hours × £65£5,200.00
Mixed benchmark£11,042.39
Explore the mixed benchmark calculator

This optional calculator combines purchase costs with labour at selling rate. It excludes equipment and contractor markups, so it is not a complete quotation or a profit calculation. It is separate from the selling-price builder above. Reset returns to the reported job’s figures; changes do not change the actual invoice.

Your scenario

Zero means not yet quantified, not confirmed nil. Additional hours must exclude time already in site person-days. Any extra time is valued at the selected selling rate. Equipment stays fixed at £3,878.52 excluding VAT.

Mixed benchmark
i

Equipment purchase cost + net contractor purchase cost + all site labour at selling rate + additional hours at selling rate + entered net expenses. This mixes purchase costs and selling values and excludes equipment and contractor markups. It is not a complete quotation or a profit calculation.

Against net customer charge

Benchmark compared with charge

● Equipment● Groundwork● Labour selling value● Extras
Time we are absorbing, at selling rate
i

(Total person-days − person-days we expect to charge for) × hours per day × hourly selling rate. Already included in the benchmark; do not add it again. The two reported waiting person-days used £1,040 of labour selling capacity and reduced availability for other work. Selling capacity is not lost profit or a confirmed additional invoice.

Changing the days we expect to charge for changes the time split, not the fixed customer charge. Revenue changes only when you change the customer charge input.

What another day changes

Benchmark at the selected rate and hours, holding all other inputs constant.

Show calculation and exact figures
OPTIONAL / QUESTIONS

A question about the numbers?

Open the guide and search for a plain-English explanation.

Open the question guide

Why do we add a markup?

Supplying equipment or arranging contractors involves work, expense and responsibility for KeyPlus. Our markup helps cover those commitments and the funding we provide.

We fund the job before we get paid.

We pay suppliers and contractors before the customer pays us. That ties up our cash, leaving less available for wages, overheads and other jobs. Funding the gap can also mean overdraft interest or other finance charges.

The longer completion and payment take, the longer we carry that cost and cash-flow pressure. Our markup helps cover this funding burden as well as the work involved.

EXAMPLE · 25% MARKUP
£100 purchase cost + £25 markup = £125 selling price.

Margin on this item before other costs is £25 ÷ £125 = 20%. 25% markup is not 25% margin. The extra £25 contributes towards those responsibilities, financing costs, running costs and profit. It is not automatically profit.

Labour recovery and markups share the task of covering company costs. Allocate those costs once; do not add the same overhead or job expense twice.