Does it recommend a profit percentage?

No. Every percentage is your commercial decision. The tool suggests no figure and stores no benchmark.

Why is the effective margin different from the profit percentage?

Because the effective margin measures all mark-up amounts against the final tender price, whereas the profit percentage is applied to an intermediate figure.

How are provisional sums treated?

They are added after the mark-ups, before the bond and insurance percentage, so they are not inflated by profit.

Where should the direct cost come from?

From your priced bill — for example the multi-discipline BOQ collection or rates built with the unit rate analysis tool.

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Tender Price Calculator

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Contractor Business & Tender SuiteStep 3 of 4

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Bid decisions fail when the price is assembled informally. This Professional calculator applies your preliminaries, risk allowance, overhead and profit cumulatively to the direct cost, adds provisional sums, applies the bond and insurance percentage, and reports the effective margin the submitted price actually carries.

Method and assumptions

after preliminaries = direct cost × (1 + preliminaries%)
after risk = after preliminaries × (1 + risk%)
after overhead = after risk × (1 + overhead%)
net cost = after overhead × (1 + profit%)
tender price = (net cost + provisional sum) × (1 + bond/insurance%)
effective margin % = (Σ mark-up amounts) ÷ tender price × 100

Preliminaries, risk allowance, overhead and profit percentages are applied cumulatively on the direct cost, then the provisional sum and bond/insurance % are added on top.
All percentages and inputs are user-defined; the calculation is purely arithmetic and assumes no particular code or specification.
A preliminary decision-support estimate: the result does not replace an approved design calculation or review by a competent authority.

Frequently asked questions

Does it recommend a profit percentage?: No. Every percentage is your commercial decision. The tool suggests no figure and stores no benchmark.
Why is the effective margin different from the profit percentage?: Because the effective margin measures all mark-up amounts against the final tender price, whereas the profit percentage is applied to an intermediate figure.
How are provisional sums treated?: They are added after the mark-ups, before the bond and insurance percentage, so they are not inflated by profit.
Where should the direct cost come from?: From your priced bill — for example the multi-discipline BOQ collection or rates built with the unit rate analysis tool.

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