Does anyone use flat rate pricing? I am toying with the idea of using it for small jobs such as installling a recptacle, or a fixture, etc...Any insight and recommendations on this method of pricing would be helpful.
I bid all of our service call work by the item/job. I just have set prices for most items and I can wing it for other items. The only tip I can think of is when giving estimates on a list of items, make small items very reasonable or cheap. I do this so that when the customer is reviewing the list they see several items that they know are a bargain, you can make it up on the items that look harder than they are.
I would much rather work from a bid. This way the customer knows the cost up front and I know what I'm getting. If the job gets done really quick, it's better for both of us. One other thing, once you give a price you've got to stand by it, even if the job takes 3 times as long as expceted, just like you don't reduce your price when the job takes only half the time.
[This message has been edited by Electric Eagle (edited 12-02-2002).]
Good luck to y'all. Having set prices for items is difficult at best, but I can really dig what Eagle has to say about customer "politics". Not knowing the "ropes" on something like this may be some cause for panic in those touchy situations when some "hotshot" customer calls your bluff on an expensive item, but I'm sure after a few of those experiences you get your "sea legs". I do side work from time to time, and I often feel like I'm the "King of the $10,000.00 light bulb, and the Queen of the $.25 service".
I wasn't planning on committing to flat rate as my sole means for billing. I thought it might be handy to have some sort of flat rate price list (on the hight side) for the customers that ask how much for a phone jack, or how much for an outlet.....
When I go onto a job which requires trouble shooting, I set a per hour rate. Some guys use a method of a first 1/2 hour charge, then each hour after that. I guess the rate varies with the area of the US. In residential, a lot of problems are found within the first 1/2 hour anyway. If I go into a house with several things that are out, I tell the people, I may find the problem in 5 minutes or 5 hours, depending on the situation. Happy Holidays
Spyder; I think flate rate for small services as you descibe is excellent for your business. It not only gives yourself an insight of what's ahead, but opens the doors to customers who know what to expect, not like some other businesses that may not have a more refined billing method wich leaves the customer in the dark. Heres one example of what i was charging. (these are old work installations) 1st/fl. outlet installation: $75. 2nd/fl. outlet installation $125. 3rd/fl outlet installation $175.