Adding profit and overhead

tips for tailoring The Assistant Estimating System for your company's use
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vcwjeff
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Adding profit and overhead

Post by vcwjeff » Wed Dec 03, 2008 6:36 pm

I'm having a difficult time estimating our "markup" for profit and overhead.

I need some advice on how to add a profit of ~20% and overhead ~25% to our bid, and then be able to adjust these percentages individually per job.

Any ideas are welcome, but as of now, the "project-wide markups" section in the Project Setup is what we are using...though it doesn't work as intuitively as I would like. We are having to enter '4' into 'additive markup for ALL labor' to get near our 45% P&O goal.

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John Whitling
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Post by John Whitling » Wed Dec 03, 2008 8:32 pm

There are two normal markup areas.

In Project information form (available on the project summary) there is a markup settings tab. You can adjust the material markups there. You can also apply "additive" markups there as well. Normally the additive markups are used for adjusting individual project markups.

In addition to the above, there are areas for overhead and profit in the Labor rates sheet. They can be set individually for each labor department.

Trying to arrive at a 45% combined job-wide overhead and profit markup would mean you have to set material markups to 1.45 and set your labor profit to a number that equals out to 1.45 markup for the labor cost AND the labor overheads. The markup is applied only to the labor cost, not the labor cost and overhead combined. Is that what's confusing?

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vcwjeff
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Post by vcwjeff » Wed Dec 03, 2008 8:44 pm

okay, I didn't notice the P&O section with the Labor Rates table, that may be where we need to start.

thanks

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