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Wrap rate calculator

Turn a direct labor rate into a fully loaded billing rate for government contracts: fringe, overhead, G&A and fee. See the wrap rate multiplier instantly.

Your numbers

Result

Estimates for planning. Always price from the solicitation and your real costs.

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How a wrap rate is built

  1. Fringe is applied to direct labor.
  2. Overhead is applied to direct labor plus fringe.
  3. G&A is applied to all costs so far.
  4. Fee is added on top of total cost.

The wrap rate is the billing rate divided by direct labor. Many small government contractors land somewhere around 1.6× to 2.2×, depending on how lean they run. Your pool structure may differ; this calculator uses the most common build-up.

Using it in a bid

Time-and-materials and labor-hour bids ask for fully loaded rates by labor category. Check that your rate beats the competition but still covers costs, and that the wage you pay meets any Service Contract Act wage determination in the solicitation.

Questions

What is a wrap rate?

The multiplier that turns a direct labor rate into a fully loaded billing rate, covering fringe, overhead, G&A and fee.

How do you calculate a wrap rate?

Apply fringe to direct labor, overhead to labor plus fringe, G&A to total cost, then add fee. Divide the result by direct labor.

What is a typical wrap rate for government contractors?

Often around 1.6 to 2.2 for small businesses, higher for firms with large overhead or facilities.