The Prevail team is delighted to share the link to our updated Profit Margin Calculator for construction SMEs. Profit Margin Calculator now has a smart new look and some additional functionality to help you decide whether its sound business to take on a given project.
We developed our Profit Margin calculator app to help construction SMEs to do a simple, high-level check to determine whether or not to bid on a project.
Our customers have used and loved this tool for nearly ten years. The Excel spreadsheet wasn’t much to look at, but it helped to ensure that their projects are profitable. It didn’t look very pretty but it got the job done.
Now we’ve relaunched the tool to make it a bit more user friendly and lot more visually appealing. Check it out here: https://profitmargincalc.com/
Why did Prevail Accountancy develop the Profit Margin Calculator?
Over the twenty years Prevail Accountancy has worked with UK construction companies, we have seen many contractors struggle to ensure that every project is profitable.
A project must generate enough profit not only to cover the cost of sale but also to cover business overheads. You need to know whether it will or not before you start. If this critical first step is missed, you’re going to be fighting an uphill battle to ensure project profitability. You’re essentially setting yourself up to fail.
Prevail’s Profit Margin Calculator gives you a simple tool to assess profit potential before you begin.
How does the Profit Margin Calculator work?
By factoring together the cost of sale (materials, project labour, equipment hire, plant hire, skip hire, subcontractors) and the overheads (the costs of running your business: rent, insurance, utilities, vehicles, salaries, professional fees) the calculator enables you to quickly see the project’s profit.
Overheads can be attributed according the expected duration of the project and how much of the total capacity of the business to deliver work the project will consume over that time.
This way, you can see the total amount of gross profit and the gross profit per month. You can also see percentage of monthly overhead covered and the margin of safety. You can then adjust each field to see the impact of changes to these figures.
This way, you can make a sensible judgement about whether or not to bid for the work – and how much to quote for the project to give yourself the project margin and margin of safety you desire.
What does the update offer over the original Profit Margin Calculator?
The updated version of the Profit Margin Calculator can be viewed here: https://profitmargincalc.com/
The look and feel has been updated. It feels modern and clean. It’s a bit more intuitive – which we hope makes it easier for you to play around with the numbers for each job and come to a decision quickly about whether there is enough profit in it.
We’ve also included some construction industry benchmarks to give you some ideas about the profit margin you should be aiming for!
We’d love to hear your feedback about the new-look Profit Margin Calculator. Send your comments to: office@prevailaccountancy.co.uk
If you would like some help or support getting started with using the Profit Margin Calculator, please contact the Prevail Accountancy team. You can reach us on: 01706 550 825
Our team offers one-to-one advice about calculating and protecting your profit margin. If you’re struggling to ensure every project is profitable, we can help. Get in touch.
