handling price increases mid-job
You quoted the job three months ago. The customer finally said yes. Now you go to order materials and the price has jumped 15%. Timber is up. Steel is up. The sparky has put his rates up. Your carefully calculated quote is suddenly underwater.
This happens to every tradie eventually. Here is how to handle it without losing the job or losing money.
why prices move
Australia has seen significant material price volatility in recent years. Some of the drivers:
- Timber. Structural pine, hardwood decking, and engineered timber have all seen sharp price swings. Supply chain issues, bushfire impacts on plantations, and strong building demand all contribute.
- Steel and Colorbond. BlueScope steel prices flow through to Colorbond roofing, structural steel, and reinforcement mesh. Global steel markets and local demand both affect pricing.
- Copper and electrical. Cable, switchboards, and plumbing fittings all track copper prices, which move with global commodity markets.
- Concrete. Sand, aggregate, and cement costs have been climbing steadily. Ready-mix pricing varies by region and season.
- Subcontractor rates. When demand is high, subbies put their rates up. A plumber who quoted $1,800 three months ago might now want $2,100.
prevention: protecting yourself upfront
The best time to handle price increases is before they happen. Build these protections into your quotes:
| Protection | What It Means |
|---|---|
| Quote expiry date | Put a 30-day expiry on every quote. After that, prices may need to be revised. |
| Rise-and-fall clause | Include a clause allowing price adjustment if material costs change by more than a set percentage (e.g., 5%) between quote and purchase. |
| Material allowances | Quote materials as provisional sums or allowances. The customer pays actual cost, not your estimate. |
| Higher uncertainty tiers | If you know prices are volatile, mark those items as High uncertainty. The simulation will build in a larger buffer. |
mid-job: the conversation with the customer
If prices have already moved and you need to talk to the customer, here is how to approach it:
- Be upfront and immediate. Do not wait until the end of the job to spring it on them. The moment you discover a price increase, tell the customer.
- Show the evidence. Bring the original supplier quote and the new one. Show the price difference. Customers are more understanding when they can see it is the market, not you padding your margin.
- Offer options. "The tiles you chose have gone up $800. We can either absorb the increase and use a similar tile from a different range, or proceed with your original choice at the new price." Giving options shows you are working with them, not against them.
- Document everything. Follow up verbal conversations with a text or email confirming what was agreed. This protects both you and the customer.
worked example: timber price increase on a deck build
| Item | Quoted Price | Current Price | Difference |
|---|---|---|---|
| Merbau decking (90x19, 30 sqm) | $3,200 | $3,680 | +$480 (+15%) |
| Treated pine subframe | $1,400 | $1,540 | +$140 (+10%) |
| Hardware (bolts, brackets, screws) | $350 | $380 | +$30 (+9%) |
Total increase: $650 on a $12,000 job. That is 5.4% of the total job value — enough to wipe out your profit margin.
when to wear the increase yourself
Sometimes it makes sense to absorb a small price increase:
- The increase is minor (under 2-3% of total job value)
- The customer is a repeat client who sends you regular work
- Your quote already had sufficient contingency built in via simulation
- You quoted at P95 and the increase is within the buffer
If your simulation-based quote at P80 already accounted for material price uncertainty (by marking volatile items as Medium or High), you may already have enough buffer to cover moderate increases without going back to the customer.
the bottom line
Price increases are a fact of life in the Australian building industry. The tradies who handle them well are the ones who plan for them upfront — with quote expiry dates, rise-and-fall clauses, and risk-weighted contingency in their quotes. The tradies who get burned are the ones who quote tight, leave the quote open-ended, and hope nothing changes.