The short answer
Price is set from a specification; cost comes from what the site actually consumes. The gap between those two varies enormously per site and almost nobody measures it at that level.
Doing so once usually changes which contracts you chase and which you reprice at renewal.
What to bring together
- Actual hours worked, not contracted hours
- Overtime and agency premiums, by site
- Travel time and cost where staff cover several sites
- Consumables issued per site against area
- Supervision and audit time
- Rework driven by complaints
Cover premiums are usually the largest surprise. A site with a high cover rate costs substantially more than its rota suggests, and cover rate is rarely reported per site.
What the analysis usually shows
| Pattern | Typical cause |
|---|---|
| Small sites unprofitable | Travel and setup not recovered |
| One client consistently poor | Scope creep beyond the specification |
| Specialist tasks lose money | Underestimated in the original price |
| High-cover sites lose money | Premium rates, lower productivity |
| Out-of-hours sites better or worse | Depends on whether premiums were priced |
The second row is worth investigating rather than repricing immediately. Scope creep is usually fixable by going back to the specification, which is cheaper than a price increase.
Use it at renewal
- Rank sites by margin per hour, not by revenue.
- For loss-making sites, identify whether it is price, scope or delivery.
- Fix delivery and scope issues before proposing a price change.
- Go into renewal with the evidence rather than a percentage.
- Be prepared to decline renewal where the numbers do not work.
Point five is what gives the rest force. A contractor who will walk away from a loss-making contract negotiates differently from one who will not.
Price new work from evidence
Once you know what sites like this actually cost, new tenders can be priced from data rather than from a standard rate per square metre.
That is the compounding benefit. The analysis pays once at renewal and then again on every subsequent bid.