How to price service jobs profitably (2026 playbook)

Start with your fully-loaded hour

Add up everything a real month costs: truck, fuel, insurance, phone, software, tools, health, taxes. Divide by the billable hours shown in your recent calendar, not all hours worked. That is your break-even hourly cost.

Add a profit target that supports replacement equipment, slow periods, and owner return. Check the resulting rate against completed-job margin each month and adjust from actuals.

Set a minimum service call

Every truck roll has a fixed cost — dispatch, drive, park, walk. If you don't charge for it, small jobs can consume the day. Calculate a diagnostic or service-call fee from your fixed dispatch cost and state whether it is credited toward approved work.

Price the outcome, not the hours

Customers don't buy time — they buy a working sink. Flat-rate pricing (a book price per common job) protects both sides. You get paid the same for a 20-minute job or a 90-minute one because your average is what covers the day. Callers stop comparing hourly rates.

Offer meaningful options

Good / Better / Best can help when there are genuinely different scopes, materials, or warranty levels. Do not manufacture a middle choice or imply a guaranteed ticket lift. Track acceptance and gross margin for each option using your own estimates.

Review prices on a schedule

Review material, insurance, fuel, wage, and overhead changes at least annually. Update prices from those costs and target margin, then monitor close rate and gross profit. Never assume a fixed increase will have no effect on demand.

Build your own before-and-after

For the baseline period, record completed jobs, revenue, direct cost, non-billable time, average ticket, and gross profit. Then introduce one pricing change at a time so the result can be attributed honestly.

In the comparison period, use the same measures and note changes in job mix and demand. Revenue alone is not the result: subtract materials, labor, travel, refunds, and added software or sales cost to find the change in gross profit.