PlumbingBossPro Blog — Running a Plumbing Business

Pricing Plumbing Work for Profit: How Owners Set Service Call and Job Prices

Most plumbers set their first prices by asking around. What does the shop charge? What did the guy down the street quote? That gets you a number, but it does not tell you whether the number pays for your truck, your time and your future. Pricing for profit starts with your own costs, not someone else's.

Prices Are a Business Decision

Before you set prices, make sure the business has a place to keep them. Switching Plumbing Business Software Without Losing a Week of Calls covers getting your services and prices into one system. This article is about what those prices should be.

The examples below are examples only. Your market, your costs and your goals set your numbers. What matters is the method.

Know What an Hour Really Costs

A plumber's wage is only part of what an hour on the job costs the company. Add up what it takes to put a van on the road for a month:

• Wages and payroll costs for the plumber.
• The van: payment, fuel, insurance, maintenance.
• Tools and machines, including the drain machine and jetter wearing out.
• Business insurance, phones, software and office help.
• The owner's own pay, which new owners often forget.

Then count the hours that van actually bills in a month, not the hours it is on the road. Drive time, supply runs, callbacks and paperwork are real hours that customers do not pay for directly. Divide the monthly cost by the billable hours and you have the floor. Anything below it loses money.

Price Each Kind of Work Differently

Different work carries different risk and different time:

• Service call. Covers getting a plumber and a stocked van to the door and diagnosing the problem. Example: an $89 service call.
• Common repairs. Toilet rebuilds, faucet replacements, disposal swaps. Many owners price these as a set job price so the customer knows up front.
• Drain cleaning. Kitchen line, main line, hydro-jetting and camera inspection, each priced for its machine and its mess. Example: a $189 drain cleaning.
• Water heaters. Replacements and tankless installs are bigger jobs with materials, haul-away and planning time built in.
• Maintenance. A yearly flush priced to be easy to say yes to, because it comes back every year. Example: a $129 water heater flush.

The mix of these kinds of work shapes the whole company, which is covered in Service, Drains, Water Heaters and Maintenance: Balancing the Plumbing Business Mix.

Keep Prices the Same Across the Crew

Once there is more than one person quoting, prices drift. The owner charges one thing, the new plumber charges less to be liked, and the office quotes something else over the phone. Customers notice, and the company loses money every time.

The fix is a single service list. In PlumbingBossPro, your services and prices live in one place, and estimates and invoices are built from them. A service call is the same price whether the owner, the office or a new hire books it. If you want to offer a discount, it shows up as a line, not as a quietly lower price.

Show the Price Before the Work

Customers hate surprises more than they hate prices. For bigger work, send an estimate the customer can approve online before the van rolls. For a water heater replacement, the estimate can carry the equipment details, and when it is approved, it becomes the scheduled job with those details already on it.

Estimate templates help here. A standard “50-gallon gas water heater replacement” template means every quote for that job starts from the same lines, so nothing gets left off.

Review Prices on a Schedule

Costs go up quietly. Fuel, materials, insurance and wages all move. If prices never change, profit shrinks a little every year without anyone deciding it should.

Pick a time each year to review every price on the list. Look at which jobs take longer than you priced for, which ones generate callbacks and which ones customers say yes to without blinking. Adjust from there. Most customers accept a fair price change. What they do not accept is a different price every time they call.

Do Not Compete on Price Alone

There will always be someone cheaper. A plumber working out of his pickup with no insurance can undercut anyone for a while. Trying to match him is a race to the bottom. Compete on what a cheap plumber cannot offer: showing up when you say, texts that tell the customer when you are coming, a clear estimate before the work, a clean invoice and a company that remembers their water heater next year. Customers who value that will pay a fair price for it.

Profit Is the Point

A plumbing company that is always busy and never ahead is usually priced too low. Work out your real hourly cost, price each kind of work on purpose, keep everyone on one service list and check the numbers every year. For more on running a plumbing company profitably, visit the PlumbingBossPro plumbing business software page.