General Contractor Sales Commission Calculator
On subcontracted work, contract value and the money you actually control are two very different numbers. Enter your average job and margin to see what a commission on each basis really costs you.
Same money, different-looking plan: 10.0% of the sale price is the same cheque as 28.6% of gross profit, at a 35% margin.
Gross profit here is revenue less direct job cost, before overhead. Commission is priced against what the job earns, not against what the company costs to run. Figures are your inputs, calculated exactly — the seeded defaults are planning estimates, not industry pay data.
A worked example: a $12,000 general contracting job
At a 35% gross margin, a $12,000 job earns $4,200 before overhead. Here is what a 10% commission costs on each basis — the same headline rate, two very different pay plans.
| 10% of the sale | 10% of gross profit | |
|---|---|---|
| Rep earns | $1,200 | $420 |
| You keep on the job | $3,000 | $3,780 |
| Share of the gross profit | 28.6% | 10.0% |
| Across 3 jobs a month | $3,600 | $1,260 |
Written as “10%”, the first plan costs 28.6% of the gross profit on every general contracting job — the same cheque a gross-profit plan would have to write as 28.6%. One of those two numbers gets negotiated; the other gets signed. Turn the question round and it sharpens: to keep 70% of the gross profit on this job you can afford 10.5% of the sale price, or $1,260 per job in the rep’s pocket.
Revenue you never touch
The defining feature of general contracting, for pay-plan purposes, is that a large share of contract value passes straight through to subcontractors and suppliers. On a job where you self-perform little, the contract might be $12,000 while the money your business actually earns and controls is a few thousand. Revenue, in that structure, is a poor proxy for anything.
A revenue-basis commission ignores that distinction entirely. It pays the rep a percentage of the whole contract, including every dollar you are simply passing through to a sub at cost — so a job with heavy subcontracted scope generates a bigger commission than a self-performed job of identical profitability. That is precisely backwards, and the wider your job mix, the more it costs.
This is the trade where the profit basis is least arguable. Paying a share of gross profit prices the rep against the money the business actually made, self-performed and subcontracted work compare correctly, and the plan stops rewarding scope you make nothing on. Run both bases in the calculator on a sub-heavy job and the gap is usually larger than owners expect.
Common questions about general contracting commission
- Should commission be paid on subcontracted work?
- On a gross-profit basis, it automatically is — proportionally to what that scope actually earned, which is the correct answer. On a revenue basis you would have to exclude pass-throughs by hand, and keep those exclusions current as your job mix changes. That is a lot of administration to reproduce what one change of basis gives you for free.
- What counts as gross profit on a GC job?
- Contract value less all direct job cost — subcontractors, materials, and your own labour on the job. What remains is what the job earned before overhead, and it is the right number to price a commission against.
- My jobs vary enormously in size. Does one rate still work?
- A profit-basis rate handles size variation better than a revenue one, because it tracks what each job earned rather than what it invoiced. Run your smallest and largest typical jobs through the calculator at the same rate — if what you keep stays sensible at both ends, the single rate is holding.
Next
A pay plan decides what a job is worth once you have won it. If the constraint is that there are not enough jobs to pay commission on, see how we generate general contracting leads — or run the revenue and ROI calculator to size the pipeline first.