Why joinery businesses consistently underprice and what it would take — structurally — to fix it.
This is a genuinely difficult thing to say and harder to demonstrate, but the available evidence suggests it's true: the median joinery business is not generating the gross margin it needs to fund reinvestment, pay the owner a market wage equivalent, and build a sustainable enterprise. The pricing is too low.
Pricing in a trade business is set by what the market 'will bear' — which is usually interpreted as what competitors are charging. When competitors are all underpricing relative to their actual costs, the market rate becomes systematically below what's needed for sustainability. This isn't a market failure in the economic sense — it's a collective accounting failure. Businesses that don't know their real costs can't know they're underpriced.
The workshops that have raised their prices successfully have almost universally done so after doing the cost calculation properly for the first time. Once you know that your overhead rate is $65/hr and your labour cost is $40/hr and your target margin is 28%, your quote price is not a negotiation — it's a calculation. Shops that know their costs are far less susceptible to market pressure on price.
The clients you'll lose when you raise prices are usually the clients you can least afford to keep — those who are most price-sensitive, who generate the most variations, and who pay slowest. The clients you want to keep — those who value quality, pay on time, and refer work — are far less price-sensitive than most workshop owners assume.
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