We didn’t make money on service, so we [went to] flat rate and that’s when we started making money.
Service Technician, Doug’s Heating and Air Conditioning
There’s always been a debate between time and materials vs flat rate pricing. Time and materials had their place and worked well for many years. But times have changed and processes have gotten better and more efficient. Simply put, you can make more money with flat rate pricing and your customers will be happier with an upfront price. Your technicians will also favor flat rate and it will put more money in their pockets! Here are five signs that it’s time to move to flat rate pricing.
- There’s little or no profit left after employees are paid. You are in business to provide good services and turn a healthy profit. Flat rate pricing allows you to do both. Many times it’s just a matter of changing your hourly rates.
- Cash Flow is always a struggle. Without proper cash flow a business struggles. With flat rate, you are charging for your overhead, the time driving, everything that goes into doing a job right. Your customers are willing to pay more when presented with an upfront price that includes everything.
- Customers want to negotiate price. When a customer thinks you are taking too long or didn’t tell them about additional repairs they demand a discount. This never goes well. If you give them a discount, then the business suffers. If you don’t give them a discount, they think they are being cheated. This can all be avoided with flat rate pricing because the customer knows the price before the work is completed.
- The Internet makes everyone an expert. With time and materials pricing, a customer may go on the internet and look up parts prices. They will ask you why your “materials” are costing them so much. Our managed flat rate database is encrypted so customers aren’t able to search to find a comparable price.
- Time is NOT on your side. Customers will be very concerned about the “time” in time and materials pricing. If they hover around you and watch the clock, the technician feels pressured and the customer often thinks they are not moving quickly enough.
Ready to make that flat rate switch? Coolfront Flat Rate database is the best way to get started on the flat rate journey. It’s a zero-cost solution, jam-packed with features that will make your life easier and more profitable. What’s more, the flat rate database can integrate with your existing software program, accessed online, and can even come in book format.
ADD Systems service module and Pegasus mobile tablet work with Coolfront’s flat rate pricing to bring you all these benefits. You get a seamless integration that simplifies your technicians’ work, improves your customer relationships and helps guarantee a profitable service department. For more information about Coolfront’s flat rate solution, visit the Coolfront website, or contact your ADD Systems account representative at 800-922-0972 or email info@addsys.com.
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