Project profitability calculator: what did that job return?
A quote is a number you hoped for. This calculator compares what a project was worth against what it actually cost to deliver — including the internal hours nobody invoiced — and tells you whether the margin you needed was the margin you got.
Price the project against its real cost
Enter the quoted value, any change orders the client has actually approved, the direct cost of delivery, the hours the work consumed, and what an hour of your own time costs you. Set the minimum margin you are willing to accept and the tool flags the project when it misses.
- Realisable revenue
- ₹5,25,000
- Internal hours cost
- ₹96,000
- Total cost
- ₹2,16,000
- Gross profit
- ₹3,09,000
- Gross margin
- 58.86%
- Your threshold
- 30%
- Revenue needed for threshold
- ₹3,08,571.43
- Margin without the change order
- 52%
- Revenue per internal hour
- ₹3,281.25
Margin is 58.86%, at or above the 30% threshold you set. This is a commercial view of your own numbers, not cost accounting: it only means something to the degree that the hours and costs you entered are the ones you actually incurred. Exclude what you cannot evidence rather than estimating it, because a margin built on guessed costs looks authoritative and is not.
How this is calculated
Realisable revenue = Quoted value + Approved change orders
Internal hours cost = Hours × Internal hourly cost
Total cost = Direct delivery cost + Internal hours cost
Gross profit = Realisable revenue − Total cost
Gross margin % = Gross profit ÷ Realisable revenue × 100
Revenue needed for threshold = Total cost ÷ (1 − Threshold ÷ 100)Realisable revenue deliberately counts only change orders that were approved and priced. Work that was done but never charged on paper is unbilled effort, not revenue — treating it as revenue is the most common way a project’s margin looks better than the bank balance. The revenue-needed figure answers the practical question: at this cost base, what would the project have to be worth to hit your target margin?
Worked example: a project that held up
A website project quoted at ₹4,50,000 picks up an approved change order of ₹75,000, giving ₹5,25,000 of realisable revenue. Direct delivery cost is ₹1,20,000, and the work took 160 internal hours at ₹600 an hour, which is ₹96,000. Total cost is ₹2,16,000, so gross profit is ₹3,09,000 — a 58.9% margin, comfortably above a 30% threshold. The same project without the change order returns ₹2,34,000, a 52% margin. Revenue per internal hour is ₹3,281.25.
Now the version that should have triggered a conversation. Same ₹4,50,000 quote, no change order, but ₹2,00,000 of direct cost and 300 hours at ₹600 — ₹1,80,000 of internal time. Total cost ₹3,80,000 leaves ₹70,000, a 15.6% margin against a 30% threshold. To have hit 30%, the project needed ₹5,42,857 of revenue — ₹92,857 more than was quoted. That gap is visible on day one, which is the entire argument for pricing scope and time before the work starts rather than reconstructing it afterwards.
Why scope and time kept apart make this unreliable
The reason most project numbers cannot be trusted is not the arithmetic — it is that the two halves of the equation live in different places and neither is joined to the other. The quote is a PDF in an email. The hours are a feeling, or a timesheet nobody completed. Direct costs arrive as a supplier bill weeks later under a different description. By the time anyone asks whether the project was worth it, the answer is an estimate built on an estimate.
The fix is not a better formula. It is attaching the time and the cost to the project that caused them, while the work is happening, so the margin is a by-product of the record rather than an archaeology exercise at month end. An hourly cost figure also has to be a real one: take the loaded cost of the person doing the work, not the number they would have liked.
And a margin is only as honest as its exclusions. If you leave out the revision round nobody wanted to price, the margin is fiction with a decimal place. Record the unbilled work as unbilled work; do not quietly reclassify it as profit.
Related tools
- Markup vs Margin Calculator — set the price from a margin before you quote.
- Profit Margin Calculator — the same arithmetic across a whole period.
- Receivables Aging Calculator — margin is only banked once the invoice is collected.
- Projects & Work — where scope, tasks, and assignments live.
- Agency Management Software — the same records framed for client work.
- All free tools for small business operations.
Want project economics read from the records?
In NoxOrigin, a project carries what was quoted against what was billed, so the commercial outcome can be discussed against what was actually delivered — and a project that was badly scoped becomes a pattern across projects rather than one unpleasant recollection. Client money reads as four separate states: quoted, billed, collected, and outstanding.
This is a commercial view of your own projects, not a cost accounting system. How much of your cost base is genuinely recorded decides how meaningful the margin is.