Pricing jobs is critical to any trade business. Incorrectly pricing jobs can reduce the profitability of your jobs and force your team to work harder.
As each company is different, there isn’t a one size fits all pricing solution. However, because pricing is so critical, many business owners struggle to find out which pricing model works best for them. There are only 2 main methods of pricing in the trade industry, ‘providing a quote upfront’ or ‘Do & Charge’, let's break them down.
‘Providing a Quote upfront’ - don’t be afraid of it!
‘Providing A quote upfront’, ‘Fixed Rate Pricing’ or ‘Upfront Pricing’ - whatever you call it, is nothing to be afraid of.
It provides your customer with a detailed solution to their problem/s. Apps like FlatRateNOW (or any quoting app for that matter) aim to give you more so you have to do less. The Allocated Labour Hours we use within FlatRateNOW are based on industry averages. If the job is more difficult, you can simply increase the allocated hours for the job.
Some businesses fall into the trap of assuming that adopting fixed pricing means there’s no room for Do & Charge. This is incorrect. Although fixed rate pricing is most likely to improve your cash flow and efficiency, it doesn’t mean you can’t adopt Do & Charge where necessary. We have some companies using FlatRateNOW who manage to do both at times.
Fixed Pricing vs Do & Charge:
Fixed Pricing is the standard pricing model we encourage our users to use for the majority of their business. This is because it is a win-win for both the customer and the trade company. The customer has a problem and the trading company can provide a dollar figure to have a solution to that problem.
Do & Charge:
Do & Charge may fit certain instances. It could help customers who have a big job to do and are happy to do it gradually over a period of time with a set dollar amount in place.
For example, a customer wants their heating system fixed over summer and wants to pay a certain amount to get done in November, and then the rest to be done in January for another certain amount.
We touch on the comparisons more in the video below: