What It Really Takes To Make Money On Small Home Service Jobs

Ask any plumber, electrician or landscaper if they’re busy and they’ll probably tell you they are. The diary is full, the phone keeps ringing and there’s always another job to get to. But being busy doesn’t always mean you’re making good money. That’s because it’s surprisingly easy to look at a job, think it went well and completely miss the costs that came with it.

Take a simple plumbing repair, if you spend an hour at the customer’s house, fit a replacement part and send the invoice when you get home it can feel like a profitable morning. But if you factor in the twenty minutes it took to drive there with the fuel you used, the time spent answering messages beforehand and the ten minutes it took to write up the invoice afterwards you might be selling yourself short. Imagine a thermostat replacement brings in $180. If the parts cost $45, fuel and travel work out at around $20, and you spend another hour altogether answering messages, writing the quote and sending the invoice. If your target is $80 an hour, the profit is much smaller than it first appeared!

The costs that are easy to overlook

Most contractors remember to charge for parts and labour because they’re the obvious expenses. It’s everything else that gets forgotten. Or if the customer asks you to replace an extra fitting while you’re already there, make sure it’s added to the invoice before you leave. Small extras are easy to forget, and over time they can make a difference to your profit. Maybe you’ve driven across town for a regular cleaning job that only takes forty five minutes. By the time you’ve travelled there and back, loaded equipment and finished the paperwork afterwards, you’ve spent far longer on the job than you originally planned. If you’ve spent half an hour putting together a quote that never turns into work then you still invested that time, even if you never got paid for it. Then there are the everyday business costs that don’t belong to one particular customer but still have to be covered. Insurance, fuel, vehicle maintenance, phone bills, software subscriptions and replacement tools all come out of your profit if they’re not included somewhere in your pricing.

Is a job really making money?

When you’re figuring out the profit of a job don’t just count the time you spend on site. Include the journey, answering customer questions, preparing quotes, ordering materials, writing invoices and chasing payments if they’re late. Sending invoices promptly is one thing you can do to make life easier as making sure every extra charge is listed clearly doesn’t just save admin later. It also helps customers understand exactly what they’re paying for, which can reduce disputes and often leads to faster payment. Once you’ve added everything together, compare those hours with what you actually charged. You might discover that a job you thought was making a healthy profit isn’t quite as worthwhile once all the extra work is included and can bear that in mind with similar jobs in the future. 

Looking back can help you price future jobs

One of the easiest ways to improve your pricing is to look at previous work. Did certain jobs always end up taking longer than expected? Were there materials you forgot to include? Did customers regularly ask for extra work after you’d already agreed the price? Looking back through previous invoices makes these patterns much easier to spot. Instead of relying on memory, you’ve got a record of what each job actually involved. Many contractors now use an invoice maker like InvoiceFly. If you’re considering an invoice maker for pricing jobs yourself, it’s worth knowing that it really does give you a clearer picture of previous jobs and helps you to build more accurate quotes (as well as keep track of costs). 

Better pricing due to better records

No contractor gets every quote exactly right, especially when every job is a little different. The important thing is learning from the work you’ve already completed instead of relying on rough estimates every time. When you know how long jobs really take, keep better records and make invoicing part of a consistent routine then it’s so much easier to price up your work with confidence.