How to build a flat-rate price book for an electrical shop

Step 1: Pull your invoices and group them into tasks

The answer is to start from what you actually sell, not from a catalogue. Export six to twelve months of invoices and job notes from your job-management or accounting software.

Then group them:

1. Sort by description. Combine near-duplicates: "swap recep", "replace receptacle" and "outlet change" are one task.
2. Define each task in one sentence, with its limits. For example: "Install one Level 2 EV charger on a dedicated circuit, panel within 10 metres of the parking spot, surface-mounted run, customer-supplied charger."
3. Count and rank. List tasks by how often they occur and how much revenue they produce.
4. Keep the top 80%. The long tail of unusual jobs stays as custom quotes.

A typical residential shop ends up with families such as devices and lighting, circuits, panels and services, EV charging, surge and backup power, troubleshooting, and small commercial service.

Step 2: Find the real direct cost of each task

Direct cost is everything that goes into the task itself: materials, direct labour time, permits and disposal.

• Materials. Use your actual supplier cost, not list price, and add a small allowance for consumables: connectors, staples, tape, anchors.
• Labour time. Use your own job history, not a book standard. Take the median time for that task over your last 20 or more examples, and include set-up, cleanup and customer explanation.
• Direct labour cost. Multiply that time by your fully loaded field labour cost per hour from your payroll records. We don't publish wage figures; use your own.
• Permits and fees. Add the typical permit cost where the task requires one.

Write each figure down. A price book only works if every number can be traced.

Step 3: Calculate overhead per billable hour

This is the step most shops get wrong, and it is the one that hides losses.

Overhead is everything that keeps the company running but isn't tied to one job: rent or shop costs, vehicles, fuel, insurance, office staff, software, phones, marketing, accounting, tools and the owner's management time.

Divide annual overhead by billable hours, not paid hours.

Billable hours are lower because of drive time, supply runs, training, vehicle maintenance, callbacks and quiet days. If you price on paid hours, every task carries $18 an hour less overhead than it should in this example, and across a year that gap can be larger than your profit.

Step 4: Set margin targets by task family

Not every task should carry the same margin. Small tasks carry more risk per dollar, and large predictable ones less.

A simple structure:

• Small, quick tasks (devices, fixtures, minor repairs): highest target margin, because travel and set-up are a large share of the job.
• Medium tasks (circuits, chargers, surge protection): middle target.
• Large tasks (panel and service upgrades, generator connections): lower percentage target, because the dollar margin is already large and customers compare quotes more closely.

The formula is the same for each:

Price = (materials + direct labour + overhead for the task's hours + permits) ÷ (1 − target gross margin)

Example: a task with $520 of combined cost and a 45% target gross margin prices at $520 ÷ 0.55, about $945. Note that this is gross margin on price, not a markup on cost. A 45% markup on $520 would give only $754, which is a 31% margin. Confusing the two is one of the most common pricing errors in the trades.

Step 5: Test the new prices against last year

Before you publish anything, run the new prices against last year's jobs.

1. For each task, multiply the new price by last year's count.
2. Compare the total with what you actually invoiced.
3. Look at the tasks with the largest gap. Those are where your old prices were furthest off.

If a task's new price is far above what the market will bear, check your inputs first: labour time, materials and overhead. If they are right, that task may simply not be worth doing at your cost, which is a service mix decision rather than a pricing one.

Step 6: Write the rules for leaving the menu

A menu needs clear exits, or techs will treat every job as special.

Typical rules:

• A job becomes a custom quote when it exceeds a defined limit, such as run length, number of devices or access difficulty.
• Techs may add listed add-ons (extra length, drywall repair allowance, additional device) without approval.
• Any price reduction needs approval and a reason code in the job record.
• Troubleshooting with no clear scope is billed on a diagnostic fee, then the repair is priced from the menu.

Step 7: Present prices with confidence

How a price is presented matters as much as the number.

• Use a tablet or printed menu so the customer sees the task, what it includes and the price.
• Offer tiers where they make sense: good, better and best devices or options.
• Explain inclusions briefly: permit where required, cleanup, warranty terms you offer.
• Never apologise for the price. Train techs to explain it once, then stop talking.

A short role-play session with the team before launch helps more than a long memo.

Step 8: Review at 30, 60 and 90 days

After launch, track four numbers for each task family: close rate on presented prices, gross margin, average invoice per call and the share of jobs that left the menu.

What the patterns usually mean:

• Close rate drops sharply on one family: the price, the presentation or the tier options need work.
• Many jobs leave the menu: task definitions are too narrow.
• Margin lower than planned: labour time or materials are higher than the model assumed; recheck the inputs.

Review the whole book at least twice a year, and immediately after a significant change in material costs.

Common mistakes

• Copying another shop's menu. Different costs, different crews, different market.
• Using paid hours for overhead. Understates every price.
• Confusing markup and margin. A 50% markup is only a 33% margin.
• Ignoring drive time. It belongs in overhead or a zone charge, not in the owner's pocket.
• Letting techs discount quietly. If discounts aren't recorded, they can't be managed.
• Never updating. A price book that is two years old is a guess with a laminated cover.

Where to go from here

Once the prices hold, decide which tasks to grow with the service mix guide, and track the results with the weekly scorecard. If you would rather build the book with help, see our flat-rate pricing service or contact us.