This Business News Story Was Uncovered By Us From: https://www.entrepreneurshiplife.com/what-it-really-takes-to-price-small-home-service-jobs-without-an-accountant/
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As a business owner, you know your trade inside out and the small jobs feel like the easy ones. Whether you’re a plumber clearing a clogged drain or swapping out a broken thermostat, or you’re a cleaning company a basic clean, these little jobs can feel like the best ones to get in theory. But knowing how to do the actual work and knowing how to price it so you actually make money are two totally different things. It’s incredibly common for U.S contractors to look at a small job and just throw out a flat fee because it feels easier than working out all the math. But if you dont have formal accounting training those quick guesses can leave you working hard for barely any profit. You might think you had a great week because your truck never stopped moving but when you look at the bank account, frustratingly the money isnt there.
Breaking down the real costs
Let’s face it you are probably much more comfortable with tools and trucks than you are staring at spreadsheets all evening. But you need a simple way to figure out what things actually cost you. Take a simple thermostat replacement as an example. You might charge 150 dollars for it and think it is easy money. But you have to look at the actual breakdown of the job.
Materials: 50 dollars
Travel time: 30 minutes
On site labor: 1 hour
Overhead and taxes: 20 dollars.
If you just take that 150 dollars and subtract the parts you are totally ignoring your overhead and travel. Suddenly that decent profit turns into minimum wage.
Checking if a flat fee works
A straightforward method is to list out all your material costs, the travel time, the on site labor and a fair share of your business overhead like your commercial insurance software and vehicle costs. If your flat fee doesn’t leave a reasonable mar… Read More
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