Hourly Rate Calculator

Find the hourly shop rate you actually need to charge to cover labor, payroll burden, overhead, equipment financing, and growth. Built for shop owners trying to stop undercharging.

Rev 1.0 • Growth-Focused Shop Pricing Tool

1) Direct Labor

Start with the labor you are paying the people actually producing value on the floor.

Direct shop employees

Only include people whose time should be recovered through shop billing.

Average base wage ($/hr)

Average hourly wage before payroll burden.

Payroll burden (%)

Taxes, workers comp, benefits, PTO, etc.

Owner billable shop hours/week

Optional owner hours doing recoverable shop work.

Owner salary to recover annually ($)

Useful if the business needs to support your pay too.

Working weeks/year

50 is a good real-world default for many shops.

2) Billable Capacity

Revenue comes from billable hours, not payroll hours. This is where many growing shops underprice themselves.

Paid hours per employee/week

Billable utilization (%)

Setup, cleanup, meetings, handling, waiting, rework, and interruptions reduce billable time.

Machine recovery hours/week

Optional extra recovery basis for major capital equipment.

Capacity model

Choose how broad the recovery-hour base should be.

3) Annual Overhead & Shop Costs

These are the business costs that must be absorbed by the work going out the door.

Rent / mortgage / facility ($/yr)

Utilities ($/yr)

Insurance ($/yr)

Office / admin / software ($/yr)

Consumables / tooling ($/yr)

Equipment maintenance ($/yr)

Equipment loan payments ($/yr)

Annual financed equipment payments. Separate from maintenance on purpose.

Vehicles / fuel / delivery ($/yr)

Other overhead ($/yr)

4) Profit Target

This tool gives both break-even and recommended sell rates. Growth needs profit.

Target net profit margin (%)

Applied to revenue target, not just markup on cost.

Round sell rate to nearest

Shop notes (optional)

Recommended Results

These numbers are meant to help you price with confidence instead of guessing from what feels fair.

Break-Even Shop Rate

$0.00/hr

Covers labor, burden, and overhead with no profit.

Recommended Sell Rate

$0.00/hr

Includes your selected profit target.

Annual Revenue Needed

What the business needs to bring in annually.

Monthly Revenue Needed

Useful for pacing backlog and sales targets.

Cost Breakdown

See what is actually driving the hourly number.

Category	Annual Amount
Direct labor	$0
Payroll burden	$0
Owner salary recovery	$0
Overhead total	$0
Total annual cost	$0

Capacity Snapshot

Your rate is heavily affected by how many billable hours are actually available.

Item	Value
Available paid labor hours/year	0
Billable labor hours/year	0
Total recovery hours/year	0
Profit target	0%

What This Is Telling You

Enter your numbers and click Calculate Rate to generate guidance.