Include selling, travel and administration. This is pre-tax return and does not value invested capital.
Try this with your own numbersFormula and worked example
Owner return = (revenue − costs excluding owner pay) / owner hours
| Input | Example |
|---|---|
| Period revenue | 15,000 |
| All costs excluding owner pay | 10,000 |
| Owner delivery and admin hours | 180 |
| Calculated result | 27.7778 per owner hour |
Choose reliable inputs
Plan materials, travel and crew time before committing to a price. For this solar installation calculation, use a completed job sheet, supplier quotes and a crew schedule and a consistent definition of one installation.
- Equipment: include the portion belonging to this installation or reporting period, and record where the value came from.
- Subcontract work: include the portion belonging to this installation or reporting period, and record where the value came from.
- Site access: include the portion belonging to this installation or reporting period, and record where the value came from.
Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.
Should I include unpaid admin hours?
Include selling, travel and administration. This is pre-tax return and does not value invested capital.
What if this input changes?
If period revenue rises by 10%, this example changes by 8.3333 per owner hour. This shows the effect of one change; it does not predict what will happen.
Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.