The short answer: job costing means recording the actual hours, material and outsourced costs against each job and comparing them with what you quoted, ideally broken down by operation. Do it while the job is running, not after, and use the differences to fix your estimating rates.
Why it matters
A job can look busy and profitable and still lose money. Without job costing you can't see which types of work make money, which customers are worth keeping, or which operations you consistently under-quote. With it, every finished job makes your next quote more accurate.
What to track
| Cost | Where it comes from |
|---|---|
| Labour hours | Timesheets booked to the job, and ideally to the operation (cut, drill, fit, weld, paint) |
| Material | Purchase orders and stock issued to the job, including offcuts used |
| Outsourced work | Supplier invoices for galvanising, painting, machining, laser cutting |
| Site and transport | Cranes, freight, site labour, travel |
| Variations | Extra work approved by the customer, tracked separately |
Make timesheets easy, or they won't happen
The biggest obstacle to job costing is getting accurate hours from the floor. Paper timesheets filled in at the end of the week are guesses. What works better:
- booking time to a job and operation as the work starts, on a phone or a kiosk;
- a short list of operations, so people don't have to think about which to pick;
- a supervisor checking the day's bookings while they're still fresh.
Compare while the job is running
Check actual against quoted at milestones, not only at the end. If welding is already at 80% of its quoted hours with a third of the welding left, you want to know now, while you can still raise a variation, change the method or talk to the customer.
Feed it back into estimating
After each job, look at the operations that ran over or under. Over a few months, patterns appear: perhaps you always under-price fit-up on stairs, or overestimate drilling on CNC work. Adjust your estimating rates to match. This is the loop that turns estimating from guesswork into a system.
Watch out for
- hours booked to the wrong job because it was easier;
- material issued from stock but never recorded against the job;
- variations done without being recorded, so the job looks like it ran over;
- rework hidden inside normal hours.
How we help
In Factory Hub, a won quote becomes a job with its quoted hours carried across. The team books time on their phone, purchase orders and stock are linked to the job, and you can see quoted against actual hours while the work is still on the floor.
Common questions
What is job costing in fabrication?
Recording the actual labour, material, outsourced and site costs against each job and comparing them with the quote, ideally broken down by operation.
How do I get accurate hours from the shop floor?
Have people book time to a job and operation as the work starts, on a phone or kiosk, keep the list of operations short, and have a supervisor check bookings daily.
When should I compare actual costs with the quote?
At milestones while the job is running, not only at the end, so you can act on overruns while there is still time.