How to build a flat rate price book (step by step)

A flat rate price book is just a list of the jobs you do, each with a set price built from real costs. That’s it. The reason most shops never finish one is they try to price 500 tasks with numbers they don’t have. Here’s the order that actually works.

New to the model itself? Start with what flat rate pricing is and come back. This guide assumes you’ve decided to build the book and just need the steps.

Step 1: Work out your true loaded hourly cost

Every flat rate price starts from what an hour of your crew’s work actually costs you. Not the wage on the pay stub — the loaded number. Take the hourly wage and add payroll burden (taxes, workers’ comp, insurance, benefits), which typically runs 25-35 percent on top. Then spread your monthly overhead — rent, trucks, fuel, software, office wages — across the hours your techs actually bill, not the 40 they’re on the clock. Most residential techs bill 20-30 hours a week; the rest is drive time, quotes, and shop time.

A $30/hr tech at 30 percent burden is $39/hr loaded. Add overhead per billable hour and the real cost of that tech’s time often lands at $70-90 an hour before you’ve made a dime. Run your own numbers in the free break-even hourly rate calculator — it takes about two minutes and it’s the foundation for every price in the book.

Step 2: List your 30-50 most common tasks first

Don’t boil the ocean. Pull your last 90 days of invoices and write down the jobs that keep showing up: capacitor swaps, contactor replacements, condensate line clears, blower motor replacements, tune-ups, refrigerant top-offs. For most shops, 30-50 tasks cover 80 percent of calls. Price those well and you’ve fixed most of your revenue; you can add the long tail later.

• One row per task, named the way your techs say it in the field.
• Group by category (cooling, heating, air quality, maintenance) so it imports cleanly later.
• Skip anything you do less than once a month — quote those jobs individually for now.

Step 3: Record a real cost for every item

This is the step almost everyone skips, and it’s the one that makes or breaks the book. For each task, write down two numbers: the parts cost (from your actual supply-house pricing, not memory) and the labor hours a competent tech needs, including drive and setup time. Price minus cost is your margin — and if the cost column is blank, margin doesn’t exist. You’re just guessing with extra steps.

Step 4: Set parts markup by tier

A single flat multiplier on parts is a quiet money-loser. A 2x markup on a $600 condenser fan motor is fine; 2x on a $6 capacitor means the $12 you charged doesn’t come close to covering the truck roll that installed it. The fix is tiers: cheap parts carry high multiples, expensive parts carry low ones. A solid starting ladder is 4x under $10, 3x from $10-50, 2.5x from $50-200, 2x from $200-1,000, and about 1.6x above that. The full reasoning and the tier table are in our HVAC parts markup guide.

Step 5: Price each task at a target gross margin

Now the actual pricing, and it’s one formula, not a feel. Add up the task’s direct cost (labor hours × your loaded rate, plus parts), load it with your overhead percentage, then divide by one minus your target margin:

price = (direct cost × (1 + overhead)) ÷ (1 − target margin)

At a 60 percent target, a task with $110 in loaded cost prices at $275 — not because $275 “sounds right,” but because the math says so. Round for presentation afterward ($275 or $279, fine); just never start from the round number. The free flat rate price calculator runs this exact formula, tiered parts markup included, so you can price your whole task list in one sitting.

Step 6: Load it into your field software

A price book in a binder gets ignored. Get it into the software your techs quote from so the flat rate price is what the customer sees on every estimate. On Housecall Pro that’s a CSV import through Price Book settings — the full walkthrough is in our Housecall Pro import guide. The fast path: start from the free HVAC price book template, which already has HCP’s headers and 61 common tasks in place, and swap in your own costs and prices.

Step 7: Review it quarterly

A price book is not a one-time project. Parts costs drift — a capacitor that cost $8 last spring is $11 now, and if your price didn’t move, your margin quietly did. Put a recurring 30-minute review on the calendar every quarter: update the cost column on your top tasks from recent supply-house invoices, re-run the margin formula, re-import. Shops that skip this end up rebuilding from scratch every three years instead of adjusting every three months.

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