BUSINESS AND TRAINING
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Flat rate billers contend that customers like it . “ It helps them control their costs ,” says Simpson . Prices can ’ t balloon , “ especially if you ’ ve got an experienced plumber who can spot the potential stumbling blocks before the job starts .” If the job runs longer than expected , “ customers won ’ t be watching the clock because they know their own costs won ’ t rise .”
Strategically deploying your personnel can boost profits . “ If the book gives a plumber four hours to complete a job , but a more experienced plumber can get it done in half the time , it essentially packages a higher hourly rate into the flat price ,” Simpson continues . Of course , he points out , that means you want to be sure your employees are well trained .
While Vice of Fayette Drain and Sewer leans towards time-based pricing , his service crews are different . “ We have flat rates for drain clogs , residential water leaks , and septic cleaning ,” he notes .
Of course , flat rate service jobs can turn into larger hourly projects . “ My service guys bring in a lot of bigger jobs for my other crews ,” Vice points out . “ A simple sewer line cleaning could turn into a complete replacement . At that point , for the most part , we quote the replacement as a time-based job .”
Rationales Simpson acknowledges that a flat rate job finished quickly can translate into a steep hourly rate and trigger customer complaints . But he contends that this is rare . “ On the other hand , if you bill by the hour and the job takes longer than expected , your chances of receiving complaints increase quickly .”
I had a flat rate system that worked for all situations ,” he admits . “ It would make my life easier , but figuring that system out and implementing it , I think would be a miracle within itself .”
Regardless of how you feel about pricing structure , study it closely . Then , whichever direction you go , you ’ ll go there with more confidence in your choice . PA
Only you can decide what ’ s best for your business .
Sanders points out that contractors like plumbers , drain cleaners , HVAC repair services , and others are there to fix a problem — bringing a “ head , not simply a set of hands ” to the job . Besides the simple labour and parts put into the job , the flat rate bill should appropriately reflect the expertise and the investment in continued training .
For Vice , the question of flat versus hourly really leads to deeper considerations .
“ I spend a lot of time doing quotes and looking at jobs ,” he says . “ I have learnt that you don ’ t get every job you quote , so you don ’ t need to cut yourself short just to be cheapest .” He also wants to avoid race-to-the-bottom competitive bidding .
“ As a service company , I do not like to bid jobs , because if you are just looking for the cheapest price , that is not going to be me ,” he says . He prefers to sell reliability and local presence . “ I look at potential problems in the future , because I will be the one who services it years to come .”
Your best option Vice has clearly poured time and energy into figuring out what system works best , which is why he ’ s opted for a hybrid . “ I wish
March 2017 Volume 23 I Number 1