Why remodelers sell the whole bathroom, not the hour
A bathroom is sold as one fixed price for a written scope, and the hours stay behind the scenes. Customers who see an hourly figure start counting your hours on site and asking for credits when a day runs short. A lump sum for a clear scope avoids that argument.
Some remodelers go one step further and keep a price for each line they do often: the shower gut and rebuild, tub prep, the floor tile, mirrors, lights and paint, each with overhead and profit already inside. The customer buys the tile, fixtures and glass, and the remodeler's number covers labor and rough materials. That is one clean way to do it, as long as your line prices came from your real costs.
A line price like that only holds if you do the same room over and over in one market. Move to another room, house age or town and you need the math again. Whether you send a fixed quote or an estimate is covered in quote vs estimate.
What does a 5x8 bathroom gut cost you before profit?
On the sample, cost before any markup is $15,925, and the finished price is $21,293. The job: gut a 5' x 8' main bathroom, set a new alcove tub with a tiled surround, tile the floor, put in a vanity, toilet and new exhaust fan, then paint and trim. A plumber and an electrician do their parts as subs.
The sample takes about 77 labor hours across demo, framing repairs, tub and waterproofing, drywall, tile, paint and trim, fixtures and punch list. That is about two weeks for one person, and two weeks is the least a full bathroom renovation usually takes. Tile and fixtures go in as allowances, and new quarter-turn shut-offs go in every bid, because old shut-off valves that never get turned tend to fail the day you need them.
| A | B | |
|---|---|---|
| 1 | Sample 5x8 bathroom | Amount |
| 2 | Materials and allowances, with waste | $3,307 |
| 3 | Labor, truck and tools | $5,485 |
| 4 | Plumber, electrician and permit | $3,770 |
| 5 | Easy-to-forget costs | $3,363 |
| 6 | Markup, 5% cushion and profit | $5,368 |
| 7 | Price before tax | $21,293 |
The $5,368 above cost is 25.2% of the price, and it is left after the owner has been paid a wage. Spread over all 116 hours on the job, counting the hours nobody sees, the bathroom earns about $116 per labor hour. Add sales tax only where your state taxes remodeling, and take a deposit to book the start date.
Is $69.82 an hour enough for a remodeler?
It is enough to break even in the sample company, and not a cent more. That rate is the sample's $53,100 of yearly overhead plus the full cost of an owner, a lead carpenter and a helper, divided by the hours they actually bill. The formula and how to count billable hours honestly are in the true hourly rate guide, and the free true hourly rate calculator runs it with your numbers.
The part remodelers underestimate is the owner's week. Site visits, selections at the tile store and chasing subs eat the hours you would otherwise bill, so every hour on the tools has to carry them. Load the wage first, too: a carpenter paid $28 an hour really costs about $33.60 once payroll taxes and comp are added, before any overhead.
Here is what some remodelers bill or target. These are single owners' and coaches' numbers, not industry averages.
| A | B | |
|---|---|---|
| 1 | Number | What it covers |
| 2 | $65 an hour, plus 15% | One remodeler's kitchen labor rate, then profit and overhead on hard cost |
| 3 | $78.95 cost, about $95 billed | One owner's loaded wage plus overhead per man-hour, then a 20% markup |
| 4 | $13,000 to $15,000 | One remodeler's 5-piece master bath, labor and rough materials |
| 5 | $25,000 | What one bathroom specialist calls a normal client |
| 6 | 50% to 55% gross margin | A coach's target, price over direct cost, before overhead |
The $65 rate sits below the $95 and below the $116 the sample earns per hour. None of them is wrong for its own shop; the only wrong rate is one below your break-even.
Bathroom remodel profit margin: why a small bath needs more
A small bathroom should keep a bigger share of its price than a kitchen, because the same surprises cost more per dollar on a small job. Rotten plywood under a toilet costs about the same to fix in a $12,000 bathroom as in a $60,000 kitchen, but it eats a far bigger piece of the bathroom's profit.
Know what a margin is measured after before you copy it. A 55% gross margin is before overhead. The sample's 25.2% comes after overhead and every wage. A typical remodel ends up making something like 18% net, and it is common to see a job start at a 38% margin and finish at 28% as small extras pile up.
Markup and margin are not the same number: adding 25% to cost keeps 20% of the price. Say your job cost is $12,000 and you want 50% gross profit. Adding 50% gives $18,000, which is only a 33% margin. A true 50% margin needs $24,000. The full explanation is in markup vs margin, and how overhead fits in is in overhead and profit.
The rot, dump trips and missing faucet parts nobody quotes
On the sample bathroom, the easy-to-forget costs add $3,363 before markup, which is more than the plumber's quote. They are small one at a time, and they are mostly hours: project management and scheduling subs, the site visit and selections, supply runs, daily travel, paper and plastic on the floors, cleanup and dust control, and a callback reserve.
Getting the demo out. A trip to the dump is half a day in the truck plus gas and tipping fees, and a bathroom can take more than one. A normal bathroom rarely needs a dumpster, but a cast iron tub or an old mortar-bed floor, often an inch and a half to two inches of concrete, can mean an extra trip. Leave the dumpster off a big gut and you are asking the customer for more money halfway through, which is the worst time to ask.
Rot under the toilet. In an older bathroom you usually find something once the floor is up. Some remodelers put a fixed unknowns line on every master bath; others carry a few hundred dollars of materials for floor rot. Keep a small allowance in the price and a written term that anything bigger is priced as a change order before it is fixed.
Fixtures the customer bought. Letting clients buy their own faucets, tubs and vanities keeps the quote lower. But customer-bought parts often arrive incomplete or wrong, and someone has to sort it out. Some companies won't install material the owner bought at all, and others charge a higher labor rate when they do. At minimum, count the time and say in your terms that the fixtures must be on site before you start.
Freebies that never hit the scope. Write up even small favors, like swapped door handles or hung blinds, as a $0 line on the scope, so the customer sees what was given. Unwritten favors still come back as hours your crew spent.
Allowances, herringbone and the scope fights that cost margin
Most remodel margin is lost in the gap between what the customer pictured and what the quote said. The rule is short: if it's not in the quote, it is extra, and you charge for it. If a client comes back from the showroom with marble, the allowance covers the tile you priced and the difference is added.
Tile pattern is the classic case. The scope says a straight or brick pattern, the client mentioned herringbone once at the first meeting, and now there are days of extra cutting nobody priced. Write the tile pattern on the quote, list what is excluded, and price upgrades before the tile is ordered.
The other scope leak is time. A client who wants to start in two weeks often had a contractor not show up. Plan the start far enough out to get selections and sub dates locked, or you will pay for the idle days.
$532 a square foot: why a small bath prices high
The sample works out to about $532 per square foot of floor, and that is normal for a 40 sq ft room. A tub, a toilet, a vanity, a plumber and a permit cost about the same in a 40 sq ft hall bath as in a 60 sq ft one, so the small room always looks expensive per foot.
That is why a per-square-foot price copied from a big master bath loses money on a hall bath. Square-foot pricing is a guess about hours, and the hours are what actually change from job to job. Price from stages and hours, then look at the per-foot number only as a check.
Kitchens: the same build-up with bigger allowances
A kitchen is priced exactly like the bathroom, just with cabinets and counters as the big allowance lines. One small remodeler priced a galley kitchen at 27 man-days of 8 hours at $65 an hour plus $11,820 of materials, for $25,860 of hard cost. He added 15% for profit and overhead, about $29,740, and kept a miscellaneous line because these jobs never go exactly as pictured.
We don't quote homeowner kitchen price ranges here. The ones we found came from showrooms and translated videos, not from remodelers pricing their own work.
Checking the bathroom after it's done
The quote is only a guess until you compare it with what the job really cost. An estimate that never gets checked against the real hours can be wrong the same way for years. After each bathroom, compare actual hours per stage and actual materials with the quote, and fix the next one. See job costing.
The Remodeling Pricing Calculator does all of this in Excel or Google Sheets: your break-even rate, allowances, labor by stage, subs and permit, the don't-forget list, a customer quote, and a Job Log that shows which bathrooms made money.