How to Price Handyman Jobs: Guide for Contractors

1. Choose Your Pricing Structure

For most contractors, the first step is deciding whether you’ll price hourly, charge a flat rate, or some combination of both.

Before you decide, take some time to consider the pros and cons of each approach. Some jobs will better fit flat rate pricing, while others will call for an hourly estimate.

Flat rate pricing

Flat rate pricing is when you set a fixed rate for a job upfront. It’s best for quick jobs that are easy to estimate.

Pros

• Customers can see whether your price matches their budget.

• It incentivizes techs to work smarter and get the job done fast so that you can book more work on any given day.

• Customers can pay the fixed cost before you start the job.

Cons

• You’ll have to stick to the flat rate you agreed to, so you might end up earning less than your hourly rate if the job takes longer than expected.

• Low flat rates can pressure techs to rush the job.

• Work that’s done quickly at a flat rate might seem overpriced to customers.

Hourly pricing

With hourly pricing, you estimate the hours a job will take to complete, then multiply that by your hourly fee.

Pros

• You can bill for all the labor hours you put in to finish a job, even if your initial estimate is slightly off.

• Your customers can see an itemized breakdown of labor costs.

• If the customer wants a small additional task added to a project, adding hours to your invoice is easier.

Cons

• Customers might feel annoyed with techs who work more slowly.

• Unexpected changes might significantly increase the final cost of the project.

• You’ll limit your profitability on smaller jobs with a quick turnaround.

Remember that you can always choose a hybrid approach for the best of both worlds. That’s especially useful if a job has a simple component and another more complex task.

2. Understand Your Operating Costs

Pricing accurately also means understanding your operating costs. Operating costs are all the costs associated with running your business, including labor, cost of goods sold, and overhead expenses.

A few examples of things included in operating costs are:

• Rent

• Utilities

• Transportation

• Sales and marketing

• Office supplies

• Equipment repair costs

• Vehicle maintenance

Operating costs can be separated into two categories: fixed costs and variable costs. 

Fixed costs are costs that stay the same regardless of how much you’re working. These are costs like rent and utility bills—you can reduce them, but they don’t relate to how much you’re producing. They’re included in your markup.

Variable costs are costs that are directly tied to production. These are costs like labor and materials. To price accurately, you’ll need to adjust the total price according to the variable costs of a project.

3. Understand The Scope of the Job

Have you ever sent a quote to a customer, only to arrive at their home and realize the job was way bigger than you originally thought? That’s because you didn’t fully understand the scope of the job.

Scope includes all of the tasks and deliverables of a job. To properly scope out a job, make sure you visit the site first.

• Inspect the site: Are there any potential safety hazards your contractors have to consider before they start? Are there other things you may have to fix before you work on the customer’s initial request?

• Assess your toolkit: Will you need to buy any new tools or materials before you start work?

• Estimate how long the job will take: Base your estimate on similar jobs you’ve done in the past, with at least an hour of buffer time to ensure your price will cover labor costs.

Sometimes, customers only see the tip of the iceberg when they report a problem. For example, if you’re a carpenter, you might get a call about a broken staircase—only to find that the entire staircase isn’t built to code.

Proper inspections can help you book larger jobs and keep customers safe.

4. Understand What Materials Are Needed

An important part of your project scope is the materials you need. That’s where your pricebook comes in. Take a look at what you need to order from which suppliers, and how much each material costs.

Since costs change all the time, it’s important to keep your pricebook up to date. Fortunately, handyman business apps like ServiceTitan can help.

ServiceTitan’s Pricebook comes pre-populated with hundreds of services for your industry and a supplier catalog of common materials.

Your supplier catalog updates automatically every time prices change—so you know exactly how much you’ll need to charge to cover the cost of materials on your next project.

You’ll also get inventory management features that help you track vendor purchases and returns, with details on exactly how much stock you have on hand. When it’s time to re-order, you can let ServiceTitan do it automatically so you have materials on hand every time.

5. Define Your Labor Costs

Labor costs are the cost of all the labor hours required to complete the job. That includes the direct labor costs of techs working on a project plus indirect labor costs for non-technical employees like CSRs and office admins.

The price of labor should be factored into all of your invoices, whether they’re hourly or fixed-fee. Below are four simple steps to calculating labor costs on any project—even if you don’t know which tech you’ll send.

1. First, calculate the hours it will take to complete a job. 

2. Next, calculate your shop average labor rate (using labor averages for the past 12 months) or job average (using average wages).

3. Multiply the per-hour rate by the estimated labor hours to calculate the true labor costs.

4. Then factor in additional costs of employee benefits like vacation pay, pension, insurance, and payroll tax to get your final labor bill.

Here’s what the calculation looks like:

For example, if a job will take your techs 50 hours to complete at an average labor rate of $25 per tech, and each tech has an average of $20 in additional costs for that week, the calculation would look something like this:

So your labor costs for that job would be $1,290. You can also use ServiceTitan’s labor rate calculator to track labor costs to make the process easier.

6. Research Competitor Prices

Finally, you’ll want to make sure you’re checking up on what competitors in your area are charging. Ideally, your pricing should be aligned with the market.

Do a little research by:

• Asking customers how much other companies have quoted them

• Asking your CSRs how customers respond to your pricing

• Looking at competitor websites

• Asking other tradespeople what they charge

• Reviewing handyman listings like Angi and Yelp

Once you know what others are charging, how do you price competitively? 

Laura Thornton, CEO of TNT Home Services, aims for somewhere in the middle: “... we never ever want to price ourselves out of the market. So, we have to pay very close attention to make sure we’re in the middle. I like to be a little bit on the higher end of the middle.”

She uses ServiceTitan’s Price Insights, which uses AI to give you an overview of average pricing for similar jobs in your area: “In conjunction with our financing, we're giving [customers] options, and the insights really allow us to do that,” Thornton explains.

What Factors Affect Handyman Pricing?

Other factors will also affect your pricing besides your own costs and competitor rates.

• Location: How far do you have to travel? If you’re driving a long way to a rural area, make sure you factor in travel time.

• Expertise: Are you a skilled tradesman, or is your handyman business a side hustle? The more education and experience you have, the more you’ll be able to charge.

• Seasonality: You might need to adjust pricing to meet demand if your work tends to be seasonal. For example, you can charge more for roofing winterization in late fall when demand is high.

• Emergency work: If you get a call late at night for an urgent plumbing job, you should be able to charge more.

• Extra services: Sometimes, customers will request extra services in addition to what’s in the contract. Make sure you charge for them!

Finally, your pricing should depend on how many handyman leads you’re getting. If the phone lines are quiet, consider offering a special promotion for a while.

How Can You Create Accurate Handyman Estimates? 

An estimate is the amount you predict a job will cost. The invoice might be higher or lower depending on how long it took to complete—but accurate estimates prevent customer frustration and build trust.

Here are a few other tips for creating accurate estimates:

• Spell out what’s included in the cost: Specify what labor, materials, and discounts are included, and whether your estimate is based on an hourly or fixed fee.

• Itemize estimates: Include all the above in the estimate so any future disputes over the project's scope are more easily resolved.

• Include photos and descriptions of materials: This gives your customers a deeper understanding of how you’re pricing the job and what they’ll get for their money.

• Tie estimates directly to your pricebook: Pricing stays uniform across your company for more accurate business reporting.

• Send a digital copy: If customers need more time to decide on your handyman services, email them a copy of the estimate. Then follow up later if you haven’t heard back.

Want to take your estimates to the next level? With ServiceTitan’s field service app, techs can build estimates with a few taps right from their tablet or phone.

Techs can browse photos and product information to build comprehensive, accurate estimates from the job site. Best of all, they’ll be able to take payment through the app as well—so customers can approve work on the spot if the job needs up-front payment.

The Bottom Line

Pricing your services is difficult at first, but it gets easier as you go. You’ll learn quickly whether you’re pricing too high or too low because you’ll either have more work than you can handle, or too little.

With software like ServiceTitan, you can simplify pricing by tying your pricebook to your core business operations.

As business development consultant Kathy Nielsen puts it, “Your pricebook is the foundation for everything you do in your company. Your pricing guide drives your tech efficiency, profitability, reporting, truck replenishment, and inventory.”

So remember: a good job starts with a fair price! Price accurately, and you’ll empower your team to deliver their best work.

ServiceTitan is a comprehensive software solution built specifically to help service companies streamline their operations, boost revenue, and substantially elevate the trajectory of their business. Our comprehensive, cloud-based platform is used by thousands of electrical, HVAC, plumbing, garage door, and chimney sweep shops across the country—and has increased their revenue by an average of 25 percent in just their first year with us.