You’ve decided to start your own remodeling business. Now you’re wondering how to make it more profitable, right? This article will help you with the basics of setting prices for materials and labor, finding out what your overhead costs are, knowing when it’s time to hire an assistant so that your workload is manageable, and knowing how to turn away clients if the job doesn’t seem feasible from the beginning.

1) Research the costs of materials and labor

The first step to determining your prices is to research how much it will cost you to buy all of the materials needed for a given project, as well as how much you should charge per hour for each person on your team who works directly on the project.

2) Determine how much profit you want to make on each project

To determine your pricing, you’ll need to decide what percentage of profit that you want to earn from a given project, or in other words, how much money you would like to take home from the job after all expenses have been paid. [It’s important to note that not many remodeling businesses actually make 100% of the revenue from a given project.]

How much profit you make is going to depend on the type of work you’re doing. For example, installing carpet isn’t going to net the same profit as installing lvt flooring.

3) Calculate your overhead costs for running a business

To calculate your overhead costs, you’ll need to determine how much it will cost you each month for such expenses as rent, utilities, and supplies. This information will come in handy when it’s time to say no to clients who are asking you to take on work for which you will not earn enough money in order to cover your overhead costs.

4) Decide what type of clients you want to work with – high-end, low-budget, or both

Before taking on a client, it would be beneficial to know if they fall into the category of high-end or low-budget. It’s much more difficult to make a profit on jobs that are designated as “low budget.” Therefore, you’ll want to avoid taking on these types of projects unless your overhead costs are already covered for the month.

5) Know when it’s time to hire an assistant so that your workload is manageable

It’s important to understand when it’s time to hire an assistant or even a team of assistants. You’ll want to think about hiring somebody once you’ve become too busy for the amount of work that you’re taking on. Additionally, if you find yourself working 60 hours per week at the expense of spending time with your family, it’s a good idea to hire somebody.

6) Be willing to say no if a client doesn’t seem feasible from the beginning

Finally, when you’re approached by a client who seems as though they will not be able to afford work for which you will earn enough money in order to make a profit, you’ll want to say no. If you are not willing to turn down these types of jobs, then it’s time to hire an assistant so that your workload is manageable.

Conclusion

These six things will help you make your remodeling business more profitable. Just remember to stay on top of your finances, say ‘no’ when needed, and hire help as your remodeling business starts to grow.