How the project margin calculation works
The calculator starts with contract value and approved change orders. It then subtracts labor, materials, subcontractors and other direct delivery costs to estimate gross project profit. An overhead allocation is added separately to estimate net project profit. Keeping those two margins separate matters: a job can look healthy before office rent, insurance, management time and shared software are considered.
Use one currency throughout
The currency selector changes formatting only, using familiar English-language number formatting. It does not fetch or apply exchange rates. If a supplier invoice is in another currency, convert it using the rate your business actually expects to pay before entering it. This keeps the result transparent and avoids a hidden live-rate assumption changing an old estimate.
What overhead percentage should you use?
Use an allocation that reflects your own business. A simple starting point is annual indirect operating expenses divided by annual revenue, but that is only a broad allocation. Businesses with heavy equipment, supervision or compliance costs may need a job-specific model. The default 15% is an editable example, not a benchmark or recommendation.
Why effective hourly return matters
Net profit divided by delivery hours shows what the project returned for each hour consumed. It is not an employee wage. It is a quick comparison measure for deciding whether two similarly sized jobs are equally worthwhile. A project with a respectable headline margin can still consume enough unplanned labor to produce a weak hourly return.
Limits of this estimate
This is a planning model, not accounting, tax or investment advice. It assumes the hours and costs entered are complete, overhead is allocated as a flat percentage of revenue, and change orders are collectible. Financing costs, taxes, retention, bad debt, currency movements and the timing of individual supplier payments are not modeled. If the figures come from memory rather than current project records, that uncertainty is part of the risk.