Pricing Guides for Plumbing & HVAC Companies
“What is the average markup on HVAC and plumbing?” “How much should I charge for my home services?” We hear these questions often and with good reason. For existing or prospective owners of an HVAC, plumbing, or electrical business, determining how your costs should affect your pricing structures is critical.
Throughout our years in the industry, we’ve learned that:
Over 75% of HVAC and plumbing businesses use a hybrid of an hourly rate and flat rate/ fixed/ upfront pricing.
Most contractors can’t explain how they determined their hourly rate or fixed price for a specific service.
99% of contractors explain their pricing in one of the two following ways:
- “That’s the going rate in my area”
- “That’s just how we have always done it”
Many smaller contractors charge their customers based on how much they think they can get.
80% of business owners don’t use a printed price book for home services.
How much should you charge for plumbing & HVAC services?
You can use a general formula to determine pricing. For the most accurate pricing model, we recommend a consultation with one of our professionals, to determine the best plan of action for your individual business needs.
Formula to determine how to price HVAC & plumbing services:
Add the true total costs of providing goods and services to the gross margin your company requires to end up at your target net profit = selling price of said job.
Since the average plumbing and HVAC contractor is running at a net profit of less than 5%, there is some confusion amongst contractors.
Either contractors are targeting less than 5% net profit
The average plumbing-heating-cooling contractor is pricing their services improperly and/or running their business poorly
We believe you should earn more than 5% net profit.
When you have a pricing methodology that is based on your actual hard costs and reasonable margins, your entire company can get behind it and your business will grow in profitability immediately.
Pricing Your Plumbing & HVAC Services During A Recession
Plumbing and HVAC business owners struggle with pricing whenever there is an economic downturn.
Offering discounts may increase your sales volume, but this can quickly eat into profitability. Additionally, when the economy becomes stable again, resetting to a profitable price can be a tricky proposition - especially for existing customers. Alternately, lowering your prices may allow you to stay profitable, but you may lose opportunities as customers shop around.
As business owners ourselves, we’ve has experienced multiple recessions and economic slowdowns. We understand the fear and uncertainty that home services business owners face during times like this. By working with PlumbAmatic, we can help you navigate the choppy waters of the recession by digging deep into your business, your market, and your competition to help you establish pricing that helps you stay profitable and even potentially gain market share as your competitors sink.
Get Your Copy Of The PlumbAmatic Price Book
How the HVAC & Plumbing Price Book Works
Simply input your job costs (labor, material, equipment, subcontractor, financing, and more) and receive an adjusted price.
Apply discounts or overtime charges to one, more, or all tasks.
Establish built-in fees for financing, credit cards, and more.
Print a completed book for your techs or upload it to your current business software for mobile use.
Over 350 relevant tasks pre built and ready to use.
No per user fees, no membership required.
Accurate & Customizable
Calculate the selling price based on your actual costs of labor, materials, and desired margin.
Failure to price right is why most small businesses fail. Know you're charging enough but not too much!
Built to export
Instantly export to the most common softwares: Service Titan - House Call Pro - Service Fusion - Quickbooks - and more.
Build employee and client trust
Close more service calls at a higher average ticket with professional pricing built on true costs and fair margins.
Order the PlumbAmatic Price Book
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