Job profitability
Why a busy workshop can still lose money on a job
A worked repair example that connects labour time, parts cost and missing costs to job gross profit.
Updated 1 November 2026 · 3 minute read
A full diary does not tell you what a repair earned
The invoice tells you what you charged. To understand what a job earned, you also need the cost of the parts, the labour and any work sent outside the workshop. Review these together while the details are still fresh. A job with a healthy selling price can have a thin margin if it runs over or a supplier bill is missing.
Follow one repair from sale to cost
Illustrative example, not a customer result. All amounts here exclude GST. A repair sells for $600: $300 labour and $300 parts. The parts cost $180. Two recorded labour hours at a configured cost of $60 an hour add $120. Recorded total cost is $300, leaving $300 gross profit and a 50% gross margin. Gross margin is gross profit divided by sales, not divided by cost.
What happens when the repair takes longer?
If the same repair takes three hours, labour cost becomes $180. With the selling price unchanged, total cost becomes $360, gross profit falls to $240 and gross margin becomes 40%. The extra hour has used $60 of the job's gross profit. It may have been necessary diagnosis, a seized fastener or extra work. Check the cause before changing your estimate or discussing it with the technician.
Treat an unknown cost as a question
A blank part cost is not a free part. Check supplier costs, sublet charges and the labour cost basis before trusting the margin. In MechAxis, the profit panel flags missing costs. Labour uses recorded time and technician cost rates where available; when no time was clocked, the calculation uses hours sold and the default labour cost rate. Read that basis before comparing two jobs.
Make a short end-of-day review
Pick a completed job. Check the parts quantities and recorded unit costs, compare hours sold with hours recorded, and confirm any sublet cost. Then review the gross profit. This is a job-level view of the costs entered into the system, not a statement of business net profit: overheads and other expenses may still need to be covered. Keep the same cost assumptions when comparing work.
Try the workflow in MechAxis
Set the workshop's labour cost rate, use a test job with known parts costs and record time against the work. Open Job profit and check its cost basis and missing-cost notices. Profit visibility is restricted to authorised business roles and stays off customer documents. Use the trial to check the calculation with your own example before relying on it for decisions.
Questions
Common questions
01Does gross profit mean the workshop's net profit?+
No. Job gross profit subtracts the recorded job costs from the sale. Business overheads and other expenses may remain outside that calculation.
02Why does the margin change when time is recorded?+
Actual clocked time can replace the hours-sold estimate in the labour cost calculation. Check the panel's cost basis and whether every relevant cost is known.