A service call's cost is what your business spends to finish one completed job, and it should come from your own records, not a guess. The Fieldedge guide shows the idea with one figure, and according to Fieldedge , "In this example, the business spends $100 to complete each service call." That number is one example, so it is not a figure to assume for any shop.
Your own figure starts with the last 30 days, which the Fieldedge guide uses as its starting window, according to Fieldedge . The expenses from that window, divided by the completed calls from the same window, give a cost for each call that you can set beside your average ticket before the next quote goes out.
Key takeaways
- according to Fieldedge , one example puts a completed service call at $100, a single case rather than a benchmark for any shop.
- start with the last 30 days of expenses and completed service calls.
- count labor, vehicles, fuel, marketing and overhead in the same total for each call.
- set the cost of each call beside your average ticket before you set the quote.
Why a quoted price hides the real cost
A gut-feel price answers one question, which is what the job seems to need. It rarely answers the second question, which is what the job costs the business once everything is counted. That second number is the one a quote should be checked against before it goes out.
The gap can be wide, and according to Fieldedge , "A job that looks like it costs $60 may actually cost $90 or more once every expense is included." A single estimate from memory can drift a long way from the real cost, and the spread between those two figures shows how far.
A gut figure usually weighs the visible parts of a job, and it may leave out the costs that repeat on every call. Those repeating costs are easy to miss because they do not appear on the single job being quoted.
Travel deserves its own check, and according to Contractormag , a plumbing, HVAC or electrical contractor could be losing money on the drive. A trip that looks free in the quote can still be part of the cost of the call, so it belongs on the same sheet as the labor.
A two-column sheet keeps both numbers in view, with the quoted price in one column and the full cost of each call in the other. Each quote gets a row, so the gap between the two columns is visible job by job. The quoted price is the number the customer sees, while the call cost figure is the number that tests whether the quote is worth sending. Keeping both in the same record lets the owner see the difference without reopening old invoices.
The 5 expenses inside one service call
The five expenses are labor, vehicles, fuel, marketing and overhead, and the Fieldedge example, according to Fieldedge , counts all five when it arrives at its call cost figure. A cost sheet that leaves any one of them out is working from an incomplete total.
| Publisher | Source | Wording |
|---|---|---|
| Fieldedge | Fieldedge guide on the real cost of a service call | One example in the guide shows a company spending $100 on each completed service call after factoring in labor, vehicles, fuel, marketing, and overhead. |
| Contractormag | Control Fleet Costs and Improve Contractor Service Capacity | "If you’re a plumbing, HVAC or electrical contractor you could be losing money just getting to the job!" |
| Internal Revenue Service | Business use of car | "Include gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation (or lease payments) attributable to the portion of the total miles driven that are business miles." |
Labor is the first expense, and it covers the technician time that goes into each completed call. Those hours can come from your own time records for the calls in the window, rather than from memory. Labor can sit on its own line, so a change in hours is easy to spot when months are compared.
Vehicles are the second expense. The Internal Revenue Service lists the items to count, and according to Internal Revenue Service , they include gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation or lease payments, counted for the portion of total miles driven that are business miles. A mileage log for business trips gives that share a number to use.
Fuel is the third expense, but gas is already counted in the vehicle line, so this line should hold only the fuel that line leaves out. A fuel total that covers a different set of trips than the mileage log makes the call cost figure hard to trust.
Marketing is the fourth expense and overhead is the fifth. Each needs a total from your own books for the same window as the expenses and calls, so the division uses one consistent period.
Step: pull 30 days of expenses and completed calls
The method starts with a window of time, and according to Fieldedge , "Begin with your last 30 days of expenses and completed service calls."
The window should hold the expense records and the completed calls, both pulled from the same days. Mixing a long expense period with a short call count gives a figure that does not describe any real stretch of work.
A useful sheet has five groups, labor, vehicles, fuel, marketing and overhead, with a total at the bottom. Each group keeps its own subtotal, so the total can be traced back to the records behind it.
The call cost figure comes from dividing the expense total by the completed calls in the same window.
The example is built on completed service calls, so an open quote should stay out of the count.
A sheet built before the window closes avoids rebuilding expenses from memory later. A clean list of completed service calls matters here, because a quoted job that was never finished does not belong in the count. The date written beside the total makes the next update easy to compare.
Once the figure is on paper, it becomes the floor for the next quote rather than a number to remember. The figure can be recalculated each month, with the date written beside it, so any movement is visible.
Marketing cost for each job: a worked example
Fieldedge works through marketing with one example. According to Fieldedge , if you spend $3,000 per month on marketing and generate 150 completed service calls, that is $20 in marketing cost for each job before the work even begins.
The arithmetic is spend divided by completed calls. In the example, $3,000 divided by 150 gives $20, so the same division works with your own monthly spend and your own count of completed calls.
The result moves with either input. A larger spend over the same calls raises the share each job carries, and more completed calls over the same spend lowers that share.
That share belongs in the call cost figure from the start, rather than being added later, so the quote is set against the full number.
A separate marketing line on the cost sheet keeps the share visible each month, and it makes a change in spend easy to read against the total for each call.
If spend and completed calls fall in different windows, the division will not reflect the same period, so match them to the same 30 days.
Compare your cost for each call to your average ticket
A cost sheet works best when the call cost figure sits beside your average ticket. The comparison shows how much room is left after the cost is covered, and that is the question the quote has to answer.
The guide offers a higher ticket as a contrast, and according to Fieldedge , "If the average ticket is $250, there may be healthy room for profit."
The same guide gives a lower ticket as well, and according to Fieldedge , "But if the average ticket is $115, the business may be much closer to breaking even than the owner realizes."
Neither example is a target for any trade, so only your own call cost figure and your own average ticket belong in the comparison.
Both figures should sit in dollars for each call, so the gap reads the same way every month.
A ticket figure is only as steady as the jobs behind it, so the average should come from the same window used for the cost. Pairing the two windows keeps the comparison from mixing a slow month with a busy one.
What moves the number
Travel is the first place to look when the call cost figure moves, because every job starts with a drive.
Job mix changes the average ticket. A run of unusually large or small jobs can shift the comparison, so use a window that covers a range of work instead of one unusual week.
Marketing spend and completed calls move the marketing share in opposite directions: higher spend raises the share, and more completed calls lower it. The arithmetic from the marketing section shows that the share depends on how many completed calls the spend is divided among.
Vehicle costs, according to Internal Revenue Service , are tied to business miles, so a log of those miles lets the vehicle line match the trips it covers.
For the tax side, see the service call cost tax references article . For discounted quotes, see the service bundle pricing inputs article .
Next step: add up your last 30 days of expenses, divide by completed service calls, and compare the result to your average ticket.
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FAQ
What counts in the cost of a service call?
The example in the Fieldedge guide, according to Fieldedge , counts five items: labor, vehicles, fuel, marketing and overhead. Vehicle costs, according to Internal Revenue Service , cover the business share of gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation or lease payments. For labor, fuel and overhead, your own records supply the figures.
How many days of data should I use?
The starting window is your last 30 days, according to Fieldedge , covering both expenses and completed service calls. Using the same window for both lists keeps the division consistent. If you choose a different window, write its dates on the sheet so the comparison stays readable.
How do I work out marketing cost for each job?
Marketing cost for each job is the marketing spend divided by the completed service calls in the same 30-day window. If the spend is $3,000 per month and there are 150 completed calls, according to Fieldedge , that is $20 in marketing cost for each job before the work even begins. Your own spend and call count fit the same division, which keeps the figure tied to your records.
When is an average ticket too close to break-even?
A $115 average ticket is the example that, according to Fieldedge , may sit much closer to break-even than an owner expects. The same guide, according to Fieldedge , says a $250 average ticket may leave healthy room for profit. Your own call cost figure beside your own average ticket is the comparison that counts.
Why can a job cost more than it looks?
A quoted price shows only part of what it takes to complete a job. A $60 job may cost closer to $90, $110, or more, according to Fieldedge , once every expense is included. Every line counted before the quote goes out keeps the price above the full cost rather than the visible one.
Can getting to a job cost money?
The trip is part of the cost, and according to Contractormag , plumbing, HVAC and electrical contractors could be losing money before they reach the job. Keeping drive time on a separate line makes the trip visible in the call cost figure. The vehicle and fuel lines described above are where those trip costs land.