In this episode Richard shares one of the biggest mistakes he made with his plumbing business. It was a bitter cold February with lots of plumbing emergency calls. It was a record high for service calls — but a record low for profits.
Subscribe
Apple | Stitcher | Castbox | Spotify | Google Podcasts
Resources
3 Golden Nuggets
- You should charge more for service fees during busy times. You only have so much time. This is supply and demand at work.
- In cases where it truly is an emergency (like frozen pipes or times of flooding), everybody works late into the evening and weekends, because of the opportunity. Ride the wave.
- Pay your plumbing techs by piece rate. No one wants to be out there thawing a pipe when it’s freezing. But the 2-hour pipe job that pays 4 hours makes it worth their while.
Sponsors
-
- KickCharge Creative. Your logo and truck design are vital to making sure you stand out in a crowd and are remembered. KickCharge Creative is the plumbing industry’s leading branding and truck wrap design agency. Save $500 on a Logo and Vehicle wrap package with the Million Dollar Plumber Discount.
- ServiceTitan is the world’s leading all-in-one field management software for plumbing service businesses. It’s what I used to build my multimillion-dollar plumbing business and I highly recommend you use it, too. Get a free demo today.
Show Notes
My Plumbing Emergency Service Mistake
One of the biggest mistakes I made was in a bitter cold February.
My mistake? I didn’t charge correctly.
(9:30) One of the biggest mistakes I made as a plumbing business owner was in a bitter cold February. That February we ran more calls than we did in the whole history of our company. We were so busy.
But financially it was a RECORD LOW month.
Our mistake? We didn’t charge correctly.
At a time when we were charging $225 an hour, our monthly average ticket rate turned out to be only $136.00. We ran a million calls for frozen pipes. Our guys were working tons of hours for these plumbing emergency service calls. But we didn’t charge right.
Pricing A Plumbing Emergency
(13:17) If you don’t want to make the same mistake we did, you shouldn’t do any frozen pipe call for less than $500. Shocked? Just hear me out.
(13:53) First of all, frozen pipe calls are slow going. Winter in general is slow going. The roads are icy. Your guys are driving slower. They are moving slower – physically and emotionally. Attitudes are slower because it’s cold outside. They’re all bundled up in layers, in and out of the truck, it’s miserable. Remember, we’re selling time, and you’re losing time.
(15:56) Second of all, it’s supply and demand. There are a lot of customers with frozen pipes. Demand is high. But you only have so much time to sell. And you’re already losing time because things are going slower.
(18:19) When demand for your services is high, it’s okay to ride the wave. Frozen pipe season is one of those times. There is nothing wrong with that.
You’ve heard the phrase, the buffalo are running. When they’re running, it’s time to hunt; get as much food as you can to last the winter, because it will be a while before they run again.
The same concept applies for your plumbing business. Ride the wave, and charge appropriately for what you do when circumstances cause you to lose time.
Pay Piece Rate
(19:34) As a rule, our plumbing technicians did not work after hours, weekends, and holidays. BUT in cases like this where it truly is an emergency like frozen pipes or times of flooding, everybody’s working, and we would work in the evening or on a Saturday.
At these times, when you’re going to have a lot of emergency calls, stay open and provide the service for the customers.
We called it code red. But we made it an opportunity for our plumbing techs by charging appropriately and paying them by piece rate.
No one wants to be out there thawing a pipe when it’s freezing. But that 1- or 2-hour pipe job would pay 3 or 4 hours. Now you’ve made it worth their while.
They pick up the pace knowing they’ll work maybe an hour and a 1/2 but get paid four hours. They are motivated to get to the next one, and they feel okay about working until nine o’clock because the buffalo are running.
Piece rate is the way to pay and takes care of your guys.
Increase Your Service Fees
(23:10) Should you charge more for service fees during these times? Yes.
During code red we would charge an emergency fee.
Our regular service fee was $49, and we’d waive it if we did any work. The code red service fee was $79, and we didn’t waive it. That paid the tech an hour of travel time.
Calls after five o’clock became our 911 rate.
We charged the customer $99, and our guys got paid three hours.
So, now when they’re working late doing frozen pipe, they get three hours for the call and then four hours for the job. Your techs can make almost an extra week’s pay in times like this.
Charging correctly lets you take care of your plumbing technicians. You can pay them well. And you can have sandwiches or soup ready for them when they get back to the shop after a cold day. These times are a great opportunity for your guys to win while having to work above and beyond the normal call.
You’re providing a great service to your customers. It’s okay (and necessary) to charge appropriately.
Richard’s Call to Action.
If you want to learn more about numbers that matter and how to best run your plumbing business, why not schedule a free 30-min strategy call with us? Let’s talk about your goals and where you want to be this time next year, and we’ll help you create a path to make that happen. Schedule your free strategy call here today!
