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Originally Posted by CWGUY
How about his pay, benefits, vehicle, vehicle insurance, business insurance, gas for vehicle, rent, electric, etc. and maybe a small profit. Nobody is in business to lose money or break even.
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Happens all the time with service labor rates, the common assumption that on site labor is paying for just the service technician's salary. Minimum call outs in hours, travel time and labor rates and all direct cost of sales, including training for different manufactures and models, in the service world provides anywhere from 30-40% margin to cover the sg&a for a 10-15%% profit before tax in the large country wide commercial service world. Key west service calls were bundled together and included overnight hotel stay or two depending upon the quantity of calls. The product being inspected and serviced were fire alarm panels, restaurant kitchenhood suppressoin systems, and sprinkler systems with state mandated inspections.
We had customers complain about the travel charge when the building was located on the same road. Like they don't understand that travel charges are an average given the service area radius. Try doing a single national service rate and be profitable across all the different cost of living areas in the united states. . . same rate alabama and new york city without looking expensive somewhere.
So best always ask ahead of time, because if no one will pay the charge, there will be no service.
finance guy