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Discussion Starter · #1 ·
For those of you that do a lot of diagnostic, service, and repair... I was hoping you could share some of your learning's.

I almost always do bid work, but have have some service and repair jobs coming my way and am trying to determine how to go about it. They are the "figure out what's wrong and fix it" type of jobs. I would greatly appreciate any input you may have to offer. The jobs will be through property management companies and need some sort of proposal to be submitted to the owner.

I plan to have a min charge of about 3 hours labor. This will cover travel time, mileage/gas, and cover an hour or two for actual work.

What else should I keep in mind?? Any precautions to avoid losing money?
 

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If I'm going in blind its base fee for the first 30 min then hourly after that.
 

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Just be upfront about your minimum and everything else, including time to get material ect....

Be HONEST with your time and be as efficient as you would on a bid job.
 
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No surprises. Even if you've been authorized to just fix it, most owners and property owners want to know immediately when you find something unexpected.
 

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Use a loaded labor rate to cover your overhead without the need to supply any materials. (I am not advocating letting customers supply materials or to not mark up materials, just to be covered if no materials are required)

I have a published minimum charge for each town that includes round trip travel plus 1/4 hour for invoicing and an appropriate fuel cost. The minimum includes up to 1 hour onsite, then billed at 1/4 hour increments if we go over.

The 3 hour minimum may work if most of your jobs are complex or require special materials or tools, but if you are doing convenience or DIY level work, the 3 hours may scare work away.
 

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I am really reluctant to give out any kind of an hourly rate. It seems like if word gets around that you charge $xx/hr it is going to scare people away even though you can get the job done twice as fast and better than the "cheaper" guy.

I may be reluctant because I'm just starting out...
 

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I am really reluctant to give out any kind of an hourly rate. It seems like if word gets around that you charge $xx/hr it is going to scare people away even though you can get the job done twice as fast and better than the "cheaper" guy.

I may be reluctant because I'm just starting out...
It's a necessary evil for some jobs. To be honest I rarely have people freak out, and those that do would freak out over any price.
 

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It's a necessary evil for some jobs. To be honest I rarely have people freak out, and those that do would freak out over any price.
It is different around here for guys in mechanical trades. But for guys like me into carpentry work, to many people are used to hearing how Amos the amish and his crew all work for $14/hr. Triple or quadruple that for a legit business and some people will not only freak out, they will freak out all around town to all their friends and let them know what you are a rip off. Best to always give a fixed price, then even if you are double the next guy they don't know what you're charging per hour.
 

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I cant imagine having a 3 hour minimum...this seems extreme

I have a trip charge and a 1 hour minimum....I also markup small parts 300%

I round up to the nearest 1/4 hour

once in a while I get a job that takes 2 minutes...I do typically give them a deal..i just don't feel right getting $200 for 2 minutes work

I don't do T&M for anything over $1,000.....I also try to have a flat rate price on many of the smaller tasks...the more the better....seeing its sight unseen you may lose $$ on 5-10% of them, but on 90-95% of them you will make more $$.....

if the job is a referral they often don't even ask me a price...they say ''come on over''
 

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Discussion Starter · #10 ·
Huggy, everyone is different how they structure their prices. I have a modest and competitive hourly rate that I pay myself and I don't really mark up materials. If a part retails for $100 and I pay $85...I would price it at $95. My hourly rate covers overhead and a small company profit.

This is what I am trying to figure out. The best way to break it down.

If one person charges $100 for a trip charge and then one hour of labor at $50, the total is $150.
Charging a three hour min at $50 still adds up to $150.

There's many ways to break it down and that's what I'm trying to learn.

Thank you all for your input. Keep it coming.

Have a great weekend.
 

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I usually only charge a 3 hour minimum if I get called out on a weekend or if its an urgent request and they want me to come right away. Beyond that I charge 1 hour minimum plus travel.

This works great when its something simple like cut off a few RJ45 ends and recrimp new connectors where I am in and out in 10 minutes.
 

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I usually only charge a 3 hour minimum if I get called out on a weekend or if its an urgent request and they want me to come right away. Beyond that I charge 1 hour minimum plus travel.

This works great when its something simple like cut off a few RJ45 ends and recrimp new connectors where I am in and out in 10 minutes.
You charge a 3 hour minimum to crimp on a connector?
 

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No that would be a 1 hour charge, the last time I charged a 3 hour minimum for something so simple was a customer requested I come out boxing day to stretch a new network cable for them.
Ah ic I misunderstood.
 

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Huggy, everyone is different how they structure their prices. I have a modest and competitive hourly rate that I pay myself and I don't really mark up materials. If a part retails for $100 and I pay $85...I would price it at $95. My hourly rate covers overhead and a small company profit.

This is what I am trying to figure out. The best way to break it down.

If one person charges $100 for a trip charge and then one hour of labor at $50, the total is $150.
Charging a three hour min at $50 still adds up to $150.

There's many ways to break it down and that's what I'm trying to learn.

Thank you all for your input. Keep it coming.

Have a great weekend.

I can tell you right now if you tell a customer that you have a 1 hour minimum vs a 3 hour minimum which one they will prefer

you would be much better to charge $100 for 1 hour minimum & a $50 trip charge......its just more normal and what people would expect

your hourly rate is dictated by 2 things...
1.all of your costs added up monthly and divided by 160 hours and whatever % you want your profit to be
2. what your competition is priced at (hopefully they aren't idiots working for less than your cost)

that's how you decide what to charge per hour....I have my fuel costs built into my hourly rate(mostly)

my trip charge is determined by the typical distance I drive between jobs....for me I figure 1/2 hour...sometimes its 1 minute sometimes its 1 hour.....it all averages out pretty close to 1/2 hour

there's not much there to structure.....if you still choose to have a 3 hour minimum that's fine...but realize you most likely wont get any small jobs.....

I also recommend raising your markup significantly on the small jobs... you will find out the call back rate for small jobs/fixes is significantly higher.....your not replacing everything new like on a large remodel...your fixing something surrounded by everything old....for me(the plumber) I find if you touch 1 thing if often effects everything in front and behind it....often I find myself turning the water back on and finding a leak on a old galvanized fitting 1 foot away from my repair

by having a higher material markup you can have a lower hourly wage..customers dont shop by material markup...the idiot price shopper goes by 1 number...your wage
 

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Here's how I handle troubleshooting calls.

Time and material only. The service call fee covers ONE man hour of labor. Anything above that is charged at an hourly rate plus materials.

This is one of the hardest things to explain to customers, and many of them simply don't understand that the REAL job is to FIND the problem. Once the problem is traced down and located, the fix is usually a simple one for electrical.

Example:

  1. Customer calls and says his outlets in the bedroom don't work.
  2. It's usually the result of someone who has backstabbed an outlet with no pigtail, and the spring finally loosened.
  3. So we open boxes until we find it.
  4. Once it's found, the fix takes only a couple minutes for THAT particular outlet.
  5. We then recommend that we pigtail all the boxes we opened and they usually take us up on it.

I would never put a quote in for an unknown issue.

Hope this helps.
 

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When I was a landlord my heating sub charged $85 an hour for the first hour and $45 an hour after that for service calls in 15 minute increments.

I was always happy to pay it as it got the heat on quick and they didn't waste any time. One phone call and I was back to my recliner.

The clock started when they left their shop or when they were leaving previous call. They always told me where they were when I called to schedule the service so I knew what to expect for travel time.
 

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It is different around here for guys in mechanical trades. But for guys like me into carpentry work, to many people are used to hearing how Amos the amish and his crew all work for $14/hr. Triple or quadruple that for a legit business and some people will not only freak out, they will freak out all around town to all their friends and let them know what you are a rip off. Best to always give a fixed price, then even if you are double the next guy they don't know what you're charging per hour.
There are just as many people who like to brag about how much they spent on something because they bought the best of the best as there are people who want to spit venom about how bad they got hosed.
 

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I am really reluctant to give out any kind of an hourly rate. It seems like if word gets around that you charge $***/hr it is going to scare people away even though you can get the job done twice as fast and better than the "cheaper" guy.

I may be reluctant because I'm just starting out...
Spencer, I fixed your hour rate for you… I assumed that was a typo :laughing: and yes you’re reluctant because you’re just starting out. It takes time, but you’ll get to the point where you can sell it without being reluctant. I’m from Indiana and I know Fort Wayne well. I’m betting there are a few guys there selling at $***/hr. or at least high $xx/hr. – it isn’t a cow town.

Don’t be reluctant to do what’s right for you and the customer :thumbsup:
 

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I dont have quick fixes but I do 1/2 day or a full day or call a handy man. I usually always go out to look first so there is an hour of my time before I even do anything.
 
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