JOB COSTINGCASH FLOWWIP REPORTINGFRACTIONAL CFOSUBCONTRACTOR FINANCEOVERHEAD RATEPAY APP BILLINGAR RECOVERYCONTROLQOREJOB COSTINGCASH FLOWWIP REPORTINGFRACTIONAL CFOSUBCONTRACTOR FINANCEOVERHEAD RATEPAY APP BILLINGAR RECOVERYCONTROLQOREJOB COSTINGCASH FLOWWIP REPORTINGFRACTIONAL CFOSUBCONTRACTOR FINANCEOVERHEAD RATEPAY APP BILLINGAR RECOVERYCONTROLQOREJOB COSTINGCASH FLOWWIP REPORTINGFRACTIONAL CFOSUBCONTRACTOR FINANCEOVERHEAD RATEPAY APP BILLINGAR RECOVERYCONTROLQORE
TL;DR: Free construction overhead rate calculator. Pull SG&A off your P&L — that single number divided by revenue is your real overhead rate. Compare it to what you use in bids. A 7-point gap on $5M revenue equals $350,000 per year coming out of profit. Benchmark overhead rates by trade: civil 12–18%, concrete 10–16%, electrical 14–20%, erosion control 10–15%, mechanical 14–20%. SPM recalculates overhead rate quarterly for every client as part of the financial system.
Free Tool
Construction Overhead
Rate Calculator.
Pull your SG&A off last year's P&L. Enter it below. Find out in 30 seconds if the overhead rate in your bids matches reality.
Published: May 2026Updated: May 2026
Calculator
Enter Three Numbers. Get Your Answer.
SG&A is on your P&L below gross profit. It is everything that is not a direct job cost — owner salary, office staff, insurance, rent, vehicles not job-costed to projects, software, professional fees. If your accountant calls it Operating Expenses or Overhead, that is the same line. Pull last year's number and enter it below.
What to Do With the Number
If Your Rate Is Wrong — Here's the Fix
If the Gap Is Over 3 Points
Update your bid model immediately. Every job you price at the old rate is underpriced by the difference. The correction only applies to future bids — jobs already under contract are not affected. One number changed in your estimating spreadsheet or software fixes every future bid.
If Your SG&A Looks Too High
Check whether project manager salaries, superintendent costs, or equipment expenses are coded to SG&A instead of COGS. These are direct job costs — they should reduce gross margin, not overhead. If they are in SG&A, your overhead rate is overstated and your gross margin is understated. Both numbers are wrong and you are making decisions off bad data.
Recalculate Every 12 Months at Minimum
Every hire, every new truck, every insurance renewal changes your SG&A. The rate in bids needs to reflect the current cost structure. A rate calculated when you were a $2M company is almost certainly wrong at $5M. Pull the P&L annually and run the calc again.
FAQ
Frequently Asked Questions
What is SG&A and where do I find it on my P&L?
SG&A stands for Selling, General and Administrative expenses. On your P&L it appears below gross profit — it is everything that is not direct job cost. Rent, owner salary, office staff, insurance, vehicles not job-costed, software, professional fees. Some P&Ls label it Operating Expenses or Overhead. If your accountant separates it from COGS, that line is the number you want.
Is SG&A the same as overhead rate?
SG&A is the dollar amount. Overhead rate is SG&A divided by revenue, expressed as a percentage. If your SG&A is $600,000 and your revenue is $4,000,000, your overhead rate is 15%. That is the number that should be in your bids. Most contractors use a rate they guessed at years ago rather than calculating it from their actual P&L.
What if my SG&A includes things that should be in COGS?
That is a common problem. Project manager salaries, superintendent salaries, and equipment costs are sometimes coded to SG&A when they should be in COGS. If that is the case, your SG&A is overstated and your gross margin is understated. SPM cleans up the chart of accounts as part of onboarding so every cost is in the right place and the overhead rate is accurate.
What should my overhead rate be?
It varies by trade and revenue. Civil and electrical contractors at $3M–$8M typically run 12–18%. Concrete and erosion control run 10–16%. Mechanical and plumbing run 13–20%. The key is not hitting a benchmark — it is that the rate in your bids matches what you calculated from your actual P&L. A gap of 4–8 points is the most common financial problem SPM sees at intake.
How often should I recalculate my overhead rate?
At minimum every 12 months, and every time you make a significant change — new hire, new equipment, expanded yard, insurance renewal. Your SG&A changes every time your fixed cost base changes. The rate in your bids needs to follow. SPM recalculates it quarterly for every client.
