Flat Rate Pricing
Definition
Flat rate pricing charges a fixed amount for a specific task, regardless of how long the technician actually takes to complete it.
What Flat Rate Pricing Means for Your Business
What it means
With flat rate pricing, the customer pays for the outcome, not the clock. Replacing a kitchen faucet is $385, whether it takes 45 minutes or 2 hours. The price comes from a price book built on the shop's average job cost plus target margin.
Why it matters
Flat rate removes the stopwatch anxiety from the customer, protects the tech from pressure to rush, and rewards skill and efficiency instead of clock-punching. It is the standard pricing model for residential service.
How contractors use it
Shops build a price book of common tasks, load it into the mobile app, and train techs to quote from the book. Updates happen 2 to 4 times per year as costs and labor change.
Real-World Example
An HVAC company switched from time and materials to flat rate pricing. Average ticket rose from $410 to $580 and callbacks dropped 30% because techs stopped cutting corners to hit clock targets.
Related Terms
Price Book
A price book is a standardized catalog of labor and material tasks with pre-set flat rate prices that technicians use in the field.
Time and Materials
Time and materials is a pricing model where the customer pays for actual labor hours worked plus the cost of parts used, usually with a markup.
Cost Plus
Cost plus is a pricing model where the customer pays the contractor's actual costs plus a fixed percentage or fee as profit.
Gross Margin
Gross margin is revenue minus the direct cost of labor and materials, expressed as a percentage of revenue.
Average Ticket
Average ticket is the mean revenue generated per service call, calculated by dividing total invoiced revenue by the number of completed jobs.
Put This Into Practice with Free Software
Kaldr Tech handles flat rate pricing and everything else you need to run your shop. $0/month, 3.5% + 30¢ per transaction.