Stop pricing temps by feel. Drop in the pay rate, candidate type, state and your margin, and this builds up the true cost, then shows your charge rate, GST and the total to the client. Adjust the on-cost percentages to match your business.
Build up the true cost of a temp and quote with confidence
The quick theory
They both describe profit, but measure it against different things. Mix them up and you under-quote without realising.
Markup is profit over your cost
Bill = cost × (1 + markup). A 30% markup on a $50 cost adds $15, so you bill $65.
Margin is profit over your bill rate
Bill = cost ÷ (1 − margin). The "divided by" version. A 30% margin on a $50 cost bills $71.43.
Same number, different money
A 30% margin always bills more than a 30% markup. To convert: markup = margin ÷ (1 − margin). A 25% margin equals a 33.3% markup. Most agencies quote on margin.
Why it matters
A flat add-on feels safe, but as pay rates rise it becomes a smaller slice of the bill. A percentage grows with the rate. Same candidate at $40 an hour, true cost about $49.28:
Flat +$10: you bill $59.28, only a 16.9% margin.
A 25% margin: you bill $65.71.
A 30% margin: you bill $70.40.
Small per hour, but across 15 temps an extra $3 an hour is roughly $1,700 a week. And clients rarely ask for a breakdown, they are paying for speed and low commitment.
This calculator is an educational starting point, not financial, tax or legal advice. On-cost percentages, the superannuation guarantee rate, payroll tax rates and thresholds, workers compensation premiums, insurance, leave loading, casual loading, award rates and GST treatment all change over time and differ by state, industry and individual arrangement. Contractor and ABN super obligations in particular can catch people out. Always verify the current rates that apply to you, and check your pricing with your accountant or a qualified adviser before you quote a client.
Book a session and we will walk through your rates, on-costs and margins together.
Price it like it is worth something,
Ez Khan
