Service Pricing Calculator

Calculate Service Pricing step by step: Price = (hours × loaded hourly cost + expenses) ÷ (1 − target margin).

In short

Formula: Price = (hours × loaded hourly cost + expenses) ÷ (1 − target margin).

Complete the required fields to see the result.

What this calculator does

Calculate Service Pricing step by step: Price = (hours × loaded hourly cost + expenses) ÷ (1 − target margin). Worked example, questions and limitations included.

Use it to turn Currency (symbol only, never converted), Estimated hours, Loaded cost per hour, Pass-through expenses (0 if none), and the other shown inputs into a checked result you can compare, copy, or rerun with different assumptions.

The page shows the formula, a numeric worked example, and the assumptions that affect this business pricing calculation.

Inputs and what they mean

Currency (symbol only, never converted): — choice value.
Estimated hours: — number value.
Loaded cost per hour: — number value.
Pass-through expenses (0 if none): — number value.
Target margin on price (your choice): — number value.

How to use it

Enter each value in the unit shown next to the box (use the unit converter first if your numbers are in other units).
Check the breakdown to see every intermediate step.
Read the limitations before relying on the result.

Formula

Margin-based pricing; margin measured on price.

Markup is profit as a share of cost: (price − cost) ÷ cost. Margin is profit as a share of price: (price − cost) ÷ price. The same sale always has a higher markup than margin — 50% markup is only 33.33% margin.

Get the loaded hourly cost from the loaded labor rate calculator.

Price = (hours × loaded hourly cost + expenses) ÷ (1 − target margin).

Inputs used: Currency (symbol only, never converted), Estimated hours, Loaded cost per hour, Pass-through expenses (0 if none), Target margin on price (your choice).

Worked example

A 40-hour project

Cost = 2,400 + 200 = $2,600.
2,600 ÷ 0.70 = $3,714.29.

Reading the result

The headline figure is the main answer. Any breakdown underneath shows the parts that make it up, so you can check the working and see what changes when you adjust an input.

Limitations and assumptions

Hours estimate is yours.
No scope-risk contingency unless you add it.
Results are educational estimates built only from the figures you enter. They are not personalised investment, tax, legal or accounting advice. Rates, growth and discount assumptions are always yours to choose.
The result depends on the values you enter for this service pricing calculator; it does not supply missing rates, rules, prices, dates, or assumptions for you.

Common questions

Markup or margin?

Should expenses carry margin?

This calculator applies margin to them. If you pass them through at cost, add them after.

Why not just cost × (1 + margin)?

That would be a markup, and would give a lower margin than you asked for. Check the formula, example, and limitations on this page before using the result for a real business pricing decision.

How do I use the Service Pricing Calculator?

Enter the required values for Currency (symbol only, never converted), Estimated hours, Loaded cost per hour, Pass-through expenses (0 if none), Target margin on price (your choice). The calculator applies the formula on this page and shows the main result with any supporting breakdown so you can check the arithmetic.

What formula does the Service Pricing Calculator use?

Price = (hours × loaded hourly cost + expenses) ÷ (1 − target margin). The visible formula section above lists the calculation path and the edge cases the page handles, so the result can be checked without relying on the form alone.

Can the Service Pricing Calculator be used for exact decisions?

Use it as a calculation aid, not as a substitute for checking the underlying rule, contract, policy, or professional advice that applies to your situation. When a result depends on local rules, personal details, prices, or dates, enter those values yourself and confirm them before acting.