Commercial restoration job costing is the practice of putting a fully loaded cost on a water, fire, or storm file before you accept the work and again before you send the invoice. Revenue is not the scoreboard. Contribution margin after labor, materials, equipment days, program fees, and overhead is.
Busy shops go broke on commercial work that looked large on the dispatch board. A $42,000 mitigation that ate four extra dry-out days, a 10 percent TPA fee, and unbilled after-hours labor is not a win. It is a donation with a claim number.
The only formula that matters
Net = invoice − labor − materials − equipment − TPA / program fee − allocated overhead. Margin = net / invoice. Run it twice: once on the first authorization, once on the closed file.
The Field App uses that same equation. It is a planning card, not a replacement for your job-costing system.
What fully loaded includes
- Labor — burden, overtime, drive time, and the PM hour that never hits the ticket.
- Materials — consumables, containment, dump fees.
- Equipment — days on site after the last reading, not days you intended.
- Program fee — TPA percent plus mandatory discounts. See the TPA playbook.
- Overhead — office, insurance, software, idle trucks. Allocate a percent.
A commercial floor
A common independent target is 15 to 25 percent fully loaded margin on mitigation after fees. Below about 12 percent on a commercial file, decline or renegotiate. Do not use the national rate sheet as your floor.
Where margin dies
- No not-to-exceed, so you argue price after demolition.
- Class 2 scoped as Class 1 because someone wanted the job.
- Equipment left “one more day” with no grain-depression story.
- After-hours cascade labor billed like a single residential unit. See the multifamily playbook.
- TPA fee modeled at zero because “we will make it up on rebuild.”
Cost it before you accept the ticket. If margin is under the floor, call the FM before you set equipment. Close the file with a one-page recap and write actual margin next to the estimate. That pair feeds the QBR.
Questions
Is job costing the same as an Xactimate estimate?
No. An estimate is what you ask to be paid. Job costing is what it cost you to produce that file.
Should TPA work use a different floor?
Yes. Price the fee in on the first pass. If the program cannot clear your floor on a normal water file, it is overflow.
Get the commercial system
The Vault includes the pricing and retention tools behind this math, plus the ERA kit. One email. No sales call.