Start Making Money in
2011 using Flat Rate
Pricing
…..a key to contractor profitability.
Mike Hajduk, President
Jeremy Lowe, Database Administrator
CALLAHAN ROACH
and
dESCO
Long Relationship – dating back to the
early 1990’s
Flexibility of flat rate usage. Books or mobile.
It works!
Started flat rate in HVAC in 1989.
Segment leader.
Sold over 5,000 dealers CAP™
flat rate.
Trained hundreds of contractors.
Who is Callahan Roach Business Solutions?
 Consulted
with industries largest and
most successful dealers.
 Recognized
as having the most
robust database of flat rate repairs.
 Serves
3 industries.
Who is Callahan Roach Business Solutions?
 91%
of all American homeowners want to have
their service company offer flat rate.

Many HVAC contractors set their service
prices to lose money.
25%
of service companies go out of business
each year…
…Pricing errors are easy to fix with flat rate.
Low Net Margins should not be fixed by beating
up suppliers about pricing.
Why flat rate as a linchpin?
Flat
rate pricing is the technician
offering the customer a no surprises
single price to make repairs on their
HVAC system, before the job is
started.
So what is flat rate pricing?
What we know it is:
Way to get enough for your
labor and parts to make a profit
Allows you to take the focus AWAY
from your price and place it on your
SERVICE and company QUALITY
Show the customer that you have
the capability to repair and install
complex systems
Matt Michel’s
“The Power of Positive Pricing”
Published by ServiceNationPress.com
Flat Rate Myths
 Flat “Rape” Myth
 Technician Resistance Myth
 The “Perfection” Myth
 The “One Long Job” Myth
 The “I can do it better myself” Myth
Matt’s Flat Rate Myths
Theatrics
It is a tool to show that your
company is head and
shoulders better than the
competition.
You compete with Macy’s, Kroger,
Target etc., for your customer’s
“eye”.
Merchandising of Your Service
Your Truck
Uniforms
Pictures of equipment and/or parts
Booties, drop cloths, cleaning work area
Flat Rate Manual or Mobile Device
Work Orders
How to Merchandise your Company
Building Value in
Service Invoices
Jeremy Lowe
Database Administrator,
Technical Training, CTO, etc,
etc, etc.
What the customer wants and
perceives as value.
2. What an improperly completed invoice
is.
3. What a correctly completed invoice
looks like, why it is important, and how
a properly completed invoice builds
value
4. How to explain multiple repairs so that
a customer understands the need to
invest in their equipment now rather
than later.
1.
Highlights
All Service Companies Need To Increase
The Dollar Revenue Of Their Service
Tickets to Remain in Business
 No Company Wants To “Gouge”
Consumers Or “Take Advantage” Of Them
 Many Consumers Need Multiple Repairs
Yet We Fear The Price May Scare Them
Away

Service Tickets
How Do We Deal With
Customers That Have Want
The Cheapest Price?
Repair Under the Diagnostic ?
Bad Mojo
 It Is a Diagnostic Only Charge
 We Are Not Giving The Customer a
Break
 We Are However Breaking the
Company!
WHY CHARGE SO MUCH?

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Running a business is EXPENSIVE!
Labor drives overhead thus unapplied time
means we must charge more
Other hidden expenses must be covered
so our company makes a profit
No profit, no jobs!
List cost of business.......

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
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Insurance For
Employees
Business Insurance
Rent
Utilities
Advertising
Training
Workers
Compensation
Other Expenses

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

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Consumables
Tools
Communications
Taxes
Fuel
Licenses
Warranties
Employee Benefits

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Not a profit center
A charge customers understand if
explained properly
Can’t make repairs under this charge
Does not cover the expense of getting you
to the door!
Devalues our service if we make repairs as
part of diagnostics
DIAGNOSTICS
DIAGNOSTICS



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
High liability when we “Diagnose”
Always finish a diagnostic
You touch it you bought it!
Failure to do so is a liability
Failure to do so is costing you
customers
Failure to do so can be laziness!
How Do We Deal With
Customers That Have Multiple
Problems When We Do The
Diagnostic, But Only Want The
Cheapest Price?
We Must Understand
What Customers
Really Want!
Understand Your Customer




“I Want A Fair Price!”
“I Want To Trust My
Repair Company!”
“I Want It Repaired
Right The First
Time!”
“I Want To
Understand What My
Servicer Is Doing To
My Home”




All People Want
Basic Human Need
Time Is Valuable and
Multiple Repairs May
Indicate
Inexperience
Consumers Fear
What they Do Not
Understand And
Can’t Explain Well To
Others
Flat Rate Service Pricing
•Giving Customers a Fair Price that is in Black
& White From a Printed Book
•Customers Feel They Can Trust a Servicer
Who is Thorough
•Doing a Complete Diagnostic Allows us to
Recommend all the Repairs Up Front
•Using Tear Off Pads and Detail on our Invoices
Builds Trust in us and the Company!
Flat Rate Builds Trust And
If Used Properly Reduces
Post Shopping Complaints
About Price
Neat And Thoroughly
Completed Service Tickets
With Good Diagnostic
Procedures Reduce Callbacks
And Increases Consumers
Understanding Of
Recommended Repairs
Perceived Value
What Value Does Your
Diagnostic Hold?
Understand Your Customer




“I Want A Fair Price!”
“I Want To Trust My
Repair Company!”
“I Want It Repaired
Right The First
Time!”
“I Want To
Understand What My
Servicer Is Doing To
My Home”




All People Want
Basic Human Need
Time Is Valuable and
Multiple Repairs May
Indicate
Inexperience
Consumers Fear
What they Do Not
Understand And
Can’t Explain Well To
Others
A Service Scenario

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Bad start Capacitor on motor
Leaking service valve cap
Safety is by passed
Needs refrigerant
Old mercury thermostat
Contactor seriously pitted

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Always recommend all legitimate repairs
Let the customer decide what they
want to do
Give your professional opinion if asked
DO NOT REPAIR ANYTHING AS PART
OF A DIAGNOSTIC!!!
Offer discounts on multiple repairs
What to Do?
Leaving an item that “Still Works” but is
obviously going to fail or is broken is bad
business
 It is not what customers want even if we
feel we are “saving” them money by
encouraging the unit to RUN TO FAIL.

Observe!
When A Customer
Understands The Value Of
Making Multiple Service
Repairs At One Time They Will
Make The Investment In Their
Home Heating System
Did The Customer
Perceive Any Value In The
Diagnostic Procedure?
TECHNICIANS
PERCEPTIONS
Not Enough Time!
 “I can’t do a good diagnostic because the
office gives me way too many calls!”
 “There is way too much stuff to check!”
 “We have no where to mark what we
check on our invoices!”

A Completed Service
Ticket and a Thorough
Evaluation Reduces
Complaints

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TAKE the time to look
Be thorough
Show the customer the price in your
book.
Look for predictive repairs
Look for preventative repairs
Be prepared to suggest upgrades
Understand what customers want!
To Build Value
What Does The
Customer See?
Summary Explanation
Bad Capacitor
$118.00
2 Pole Contactor $102.00
1 Lb R22
$29.00
Tighten Fitting
$24.00
O- Ring
$16.00
Diagnostic
$209.85
$118.00
$92.00
$26.00
$22.00
$0.00
$69.95
$100.00
$78.00
$22.00
$18.00
$0.00
$69.95
Total
$327.95
$287.95
$498.85
What Does The
Customer See?
$498 expense verses a
$287 investment with an
agreement
For A Small Investment Now The
Customer Has Peace Of Mind For The
Future
 They Can Enjoy Their System With True
Peace of Mind
 Being Preventative Reduces Future
Expenses Leaving More Money In Their
Pockets In The Future For Other Uses

Perceived Value
Perceived Value
What Do You See?
Value building
starts at the door!
What is the customers perception of
you?
 The Company?
 The service the received?
 The value?

Perception
People make multiple assumptions about
us in the first few seconds!
 We either prove their assumptions right or
wrong
 Visual clues are important to perception as
is voice and tone
 Perceptions can be changed!

PERCEPTIONS
Make What They See
Valuable!
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Desco – Callahan Roach works
Flat rate as a merchandising tool
Thorough Diagnostics
Be proactive with recommendations
Complete and neat work orders
Value building starts at the door
Contact us for consultation
1-800-528-0212
Questions and discussion regarding
our alliance?