A practical commercial decision · 20-minute exercise
Compare two jobs.
Then look at the diary.
A larger quote can leave more money per job and less for each hour of a busy team’s time. Here is how to examine that trade-off before accepting the work.
01 / Recognise the trade-off
More per job. Less per hour.
This is a hypothetical example, not a Fettle client result. Two jobs use the same team and skills. All amounts exclude recoverable VAT. Variable costs include materials, subcontractors and genuinely additional labour. Existing salaries and fixed overheads still need to be covered by contribution.
| Measure | Job A | Job B |
|---|---|---|
| Selling price | £1,800 | £1,200 |
| Variable costs, including additional labour | £600 | £500 |
| Contribution per job | £1,200 | £700 |
| Delivery person-hours | 45 | 20 |
| Contribution per person-hour | £26.67 | £35.00 |
Job A leaves £500 more contribution per job. Job B leaves more for each delivery person-hour. Neither result, by itself, tells you which job to take.
Contribution is not net profit. Here it means selling price less the variable costs caused by delivering the job. Do not deduct existing salaries as an extra cash cost unless accepting the work genuinely changes that expenditure.
02 / Ask what the job displaces
The alternative has to be real.
If 45 suitable person-hours are available and two Job B orders are genuinely available, those two jobs use 40 hours and leave £1,400 contribution. That is £200 more than one Job A, with five hours left over.
This comparison assumes both B jobs can be scheduled, all preparation and travel are included, costs repeat as shown and no other bottleneck intervenes. It is not a forecast of demand.
If only one B order exists and the rest of the time would be idle, Job A leaves more total contribution. A higher hourly figure does not create another customer.
03 / Test the uncertain number
What if the smaller job takes longer?
If B takes 30 person-hours with unchanged variable costs, it still leaves £700, but only £23.33 per hour. Two B jobs would now need 60 hours, more than the available 45.
B matches A’s original hourly contribution at 26 hours 15 minutes. That is a useful delivery-time threshold to investigate, not a target margin or industry benchmark. Any extra paid labour or other variable cost would change it.
Before choosing, check the uncertain input: how long did comparable jobs actually take, including preparation, travel and rework?
Show the calculation and its limits
Contribution = selling price − variable costs. Contribution per person-hour = contribution ÷ delivery person-hours. B’s equal-contribution-per-hour point = £700 ÷ (£1,200 ÷ 45) = 26.25 hours.
Person-hours are a useful comparison only where the work uses comparable capacity. If a specialist, machine or time slot is the real constraint, compare contribution per unit of that scarce resource separately. The job checker does not model multiple bottlenecks.
This example excludes fixed overhead allocations, tax, finance costs and cash timing. Consider deposits, customer reliability, scope risk, quality, repeat work and existing commitments. Do not accept or reject work on an hourly figure alone.
04 / Your decision sheet
Two jobs. One practical next step.
Allow around 20 minutes if your figures are to hand. Use a notebook or print this page. Work through it yourself, with your team or alongside your accountant. Keep customer names and confidential figures off shared copies.
Put both jobs on the same basis.
Use the job contribution and pricing checker for each job. Record the first result before replacing the figures. Include preparation, travel and rework; mark estimates clearly. Never enter zero just because a cost is unknown.
Job A: price / variable costs / hours / contribution / contribution per hourJob B: price / variable costs / hours / contribution / contribution per hourWrite down the actual constraint.
Which people, equipment or delivery dates are scarce? What confirmed work would each job displace? If nothing would be displaced, note that explicitly.
Available capacity and real alternative work:Change the least certain assumption.
Use the checker’s scenario option. Choose a plausible time or cost change from recent jobs or a supplier quote. Record why you chose it and whether it changes your preference.
Uncertain figure / evidence needed / effect on the decision:Choose one check before committing.
For example: confirm the scope, time a delivery stage, check a subcontractor quote or agree a deposit. Name the person responsible and a date to review the result. Use seven days if suitable, or sooner if the quote expires.
Action / owner / review date / what would change our decision:
Free guide: fettleadvisory.co.uk/compare-jobs.html
Calculator: fettleadvisory.co.uk/job-contribution-calculator.html
Which work should your business do more of?
A free 15-minute conversation with Jamie can help identify which part of the decision needs a closer look: pricing, delivery, capacity or the mix of work. If a fuller review or implementation support would help, we can explain the scope before you commit.
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