What overhead means
Overhead is the cost of running the business that is not tied to one job: insurance, truck payments, phone, software, office, licenses and your own admin time.
Also called indirect costs, operating expenses.
Where it shows up in your business
Every job price has to carry its share of overhead. Divide your yearly overhead across your billable hours or jobs to find what each one must cover.
Work it out
- Free calculator: Labor rate calculator
- Money guide: Gross vs net margin
- Money: Money guides for contractors