Underquoting is one of the biggest reasons plumbers struggle with profitability. If your quotes are too low, you’ll end up working hard but barely making money—or worse, losing money on jobs. Many plumbers only realize they’ve underquoted once the job starts and unexpected costs pile up.
If this sounds familiar, don’t worry. Here’s how you can stop underquoting and ensure every job is profitable.
1. Track Your Costs Properly
A major reason for underquoting is not having an accurate understanding of costs. When preparing your estimates, you need to consider:
✅ Material costs – Always get updated prices from suppliers and add a buffer for potential increases.
✅ Labor costs – Don’t just estimate hours—factor in travel time, setup, and potential delays.
✅ Equipment and tools – If you need to hire or replace tools, include those costs.
✅ Overheads – Things like insurance, fuel, office expenses, and admin time should be part of your pricing.
📌 Solution: Keep a detailed cost-tracking system so you know exactly how much each job costs you.
2. Use a Consistent Pricing Formula
Many plumbers guess their pricing, which leads to mistakes. Instead, use a structured approach to ensure accuracy:
📌 Cost-Plus Method
- Add up all direct costs (materials, labor, equipment).
- Add a percentage for overheads (e.g., 10-20%).
- Add your profit margin (e.g., 20-30%).
📌 Unit Rate Method
- If you regularly install certain items (e.g., toilets, taps, pipe runs), create fixed unit rates based on past jobs.
- This helps you quickly price jobs without missing costs.
Using a structured pricing method ensures that every job is priced properly rather than based on rough estimates.
3. Factor in Unexpected Costs
Even with careful estimating, jobs rarely go 100% as planned. Unexpected costs can quickly eat into your profit.
🚨 Common surprises include:
- Hidden pipework issues
- Delays due to other trades
- Material price fluctuations
- Access difficulties
📌 Solution: Always include a contingency buffer (e.g., 10-15%) in your quotes. This ensures you’re covered if something goes wrong.
4. Price Variations Correctly
Many plumbers underquote because they don’t account for variations properly. Clients or builders often ask for extra work during a job, and if you don’t charge for it, you’re working for free.
✅ Be clear upfront – State in your quotes that any changes or additional work will be charged separately.
✅ Get variations approved in writing – Before doing extra work, confirm the price and get written approval.
✅ Don’t delay invoicing – Send variation invoices promptly so you don’t forget.
📌 Solution: Stay firm on variations—small freebies add up and eat into your profits.
5. Avoid Rushing Through Takeoffs
A rushed or inaccurate takeoff (measurement of materials and labor) is a major cause of underquoting. If you miss items in your estimate, you’ll either have to cover the cost yourself or go back to the client asking for more money (which doesn’t always go well).
✅ Double-check drawings – Review all plans carefully to avoid missing details.
✅ Use takeoff software – Tools like Bluebeam, Planswift, CostX, or Cubit speed up measurements while reducing errors.
✅ Consider outsourcing – If estimating isn’t your strength, a professional estimator can ensure accuracy.
📌 Solution: Take your time with takeoffs—it’s better to spend an extra hour quoting correctly than lose thousands later.
6. Set Minimum Pricing for Small Jobs
Small jobs are easy to underprice because they seem quick. However, once you factor in travel, fuel, admin time, and setup, you might barely break even.
✅ Set a minimum charge – Ensure every job is worth your time.
✅ Charge for call-outs – If you’re diagnosing a problem, don’t do it for free.
✅ Offer packaged pricing – Instead of charging hourly, offer set prices for common jobs (e.g., toilet installation, blocked drains).
📌 Solution: Make sure even small jobs are profitable by setting clear minimum rates.
7. Compare Quotes With Other Jobs
One way to check if you’re underquoting is to compare your quotes to past jobs or other plumbers.
✅ Review past projects – Look at jobs where you made a good profit and see what pricing worked.
✅ Get feedback from multiple builders – If you’re consistently lower than others, you might be underpricing.
✅ Check industry benchmarks – Some industry groups provide average plumbing rates for reference.
📌 Solution: Don’t just assume your pricing is right—compare and adjust if needed.
8. Stay Firm and Know Your Worth
A lot of plumbers underquote because they feel pressure to win the job. Builders and clients will often push for lower prices, but that doesn’t mean you have to agree.
🚫 Don’t be the cheapest plumber – If your only selling point is price, you’ll struggle to stay profitable.
🚫 Don’t match unrealistic competitor prices – Some plumbers cut corners to offer cheap quotes—don’t compete with that.
✅ Focus on value – Emphasize reliability, quality, and avoiding costly rework later.
📌 Solution: Be confident in your pricing—low prices attract problem clients who don’t value good work.
Final Thoughts
Underquoting can drain your business, but by tracking costs, using a structured pricing approach, factoring in variations, and standing firm on pricing, you can protect your profit margins.
💡 Want accurate, professional estimates to avoid underquoting? SNZ Plumbing Estimating provides detailed, competitive takeoffs to ensure your quotes are profitable.