Job costing for builders: estimate versus actual while the job is still running
Most builders know their turnover. Fewer know their margin. Almost none know the margin on the job they are standing on today. The final account tells you what happened months later, when nothing can be done about it. Job costing is the habit of knowing while you can still act.
The idea
Every job has an estimate: labour, materials, plant, subcontractors, prelims, by element. As the job runs, every cost is posted against the same elements. The report shows estimate, committed, actual and forecast for each line, and the job as a whole. When the groundworks line is at 110% of estimate and the slab is not poured yet, you know on day nine, and you can look at why.
Cost codes that match your quote
The trick is to post costs against the elements you priced, not an accountant's chart of accounts. Groundworks, structure, roof, openings, first fix, plaster, second fix, decoration, externals, prelims. If the quote was built up that way, the costs can be too, and the comparison is like for like. EstiMate's quotes carry their elements into the job, so the job costing report is set up the moment the quote is accepted.
The four numbers per line
- Estimate: what you priced
- Committed: purchase orders placed and subcontract orders let, whether or not invoiced
- Actual: invoices and wages posted so far
- Forecast: what it will cost to finish, which is your judgement, informed by the first three
Committed is the one most builders skip, and it is the one that catches problems early. If you have ordered £9,000 of roofing materials against a £7,500 estimate, the line is already over before an invoice arrives.
Getting the costs in without an admin day
- Purchase orders: raise them from the job so the commitment is recorded and the supplier's invoice has something to match
- Supplier invoices: photograph or forward them; the AI reads the supplier, the amount and the job reference and posts them to the line
- Labour: a weekly timesheet by person and job, costed at the loaded rate (pay plus NI, pension, holiday, van and tools, which is 30% to 45% on top of the hourly rate)
- Subcontractors: their applications posted as committed, then actual when paid, with the CIS deduction recorded
- Bank: import the statement and match payments to invoices, so what has actually left the account is reconciled with what was posted
EstiMate does this with bank import and matching, receipt and invoice capture from the phone, and purchase orders raised from the job.
Reading the report
Look at the job weekly for ten minutes. Three questions: which lines are over, why, and what does it do to the forecast margin? Groundworks over because of extra depth is a variation to claim, not a loss. Plaster over because the plasterer took twice as long is a lesson for the next quote. Prelims over because the programme slipped is a conversation with the client about the delay.
What it does to your quoting
After ten jobs costed properly you know your real rates: what a square metre of blockwork actually costs you to lay, what a week of prelims really runs to, how long first fix really takes. Those numbers go back into the next quote, and your margin stops being a hope. EstiMate's quote memory learns from the actuals so the next estimate starts from your own history rather than a price book.
The reports your accountant wants
Job-level profit by month, work in progress at year end, retention held, and CIS suffered and deducted all come out of the same data. The accounts in EstiMate are built from the jobs, so year-end is a report rather than a reconstruction.
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- How to price a single-storey extension in 2026: a builder's worked example
A step-by-step build-up for a 24 m² rear extension: groundworks, structure, roof, openings, services, finishes, prelims and margin, with the items builders most often forget.
- Planning applications: the lead source most builders ignore
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- CIS explained for subcontractors and contractors: rates, returns, statements and the mistakes HMRC fines
The Construction Industry Scheme in plain English: who it applies to, the 20%, 30% and gross rates, verification, monthly returns, deduction statements, and how to reclaim what you are owed.
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