How to Price Plumbing, HVAC and Electrical Jobs in Berks

If you run a plumbing, HVAC or electrical shop in Berks County and you price jobs from your gut, I want to talk you out of it with arithmetic instead of a lecture.

You figure out what one hour of your technician's time really costs you once benefits and payroll taxes are stacked on the wage. You multiply that by the hours you pay for in a week, because you pay for all of them, and then you divide by the hours that actually land on an invoice, because you only get paid for those. You add what it costs to keep the shop open, spread over those same billed hours, and then the profit you decide you want. The number that falls out is your rate, and every quote gets built from it.

The same math prices a plumbing job, an HVAC job or an electrical job, so I'll keep all three trades on the page. Berks gives you a public floor to build from: the median plumber in the county earns about $30 an hour and the median electrician about $36, and that wage is where the price starts, not where it ends. You'll need a number you can defend on a porch, because the homeowner on that porch has already compared you against the Berks plumbers, HVAC companies and electricians on the home services page of this site.

Why not just match the going rate and knock a little off? Because the going rate was set by somebody who doesn't pay your insurance. It feels careful, and it's how a shop runs a full schedule all year and has nothing to show for it in December. This isn't an afternoon with a spreadsheet. It's twenty minutes with last month's payroll and last month's invoices, and I'll walk through it in the order you'd build it.

What plumbers, HVAC techs and electricians earn in Berks County

Start with the wage, because everything else stacks on top of it. Median pay by trade is published for the Reading metro area, and for wage purposes the Reading metro is Berks County, so this table is your county. Here's the median hourly wage for each trade.

Reading metro, hourly, most recent public data.

What does a median tell you? It's the middle of the line. Half the plumbers in the county earn more than $29.99 an hour and half earn less. The tech who shows up on time and finishes without a second trip lives in the top half, and he knows it, so plan on paying the top half and build a rate that can afford to.

What one paid hour of a technician really costs you

This is the part gut feel skips. The wage is what the tech sees on the pay stub, and what that hour costs you is bigger, because payroll taxes and whatever benefits you offer ride on top of it. I'll build the example on the median plumber wage from the table above, and you can swap your own numbers in.

Where does the $13.22 come from? In construction, benefits and payroll taxes run about a third of total pay nationally, and that's what a third adds on top of $29.99. That share already carries an average workers' comp cost, so don't stack a separate comp line on top of it. Call it $43 an hour, before the truck, before the rent, and before you have paid yourself a dime.

How to turn the loaded hour into a billable rate

Now for the point nobody tells a new owner. You pay for the whole day, and you bill part of it. Think about which hours in a tech's week get paid but never land on an invoice: the drive between jobs, the supply-house run, the callback, and the estimate that went nowhere. Nobody has ever invoiced a supply-house run. So the $43 has to be divided by the hours you can actually bill, and the number climbs.

Say a tech is paid for 40 hours in a week and 26 of those hours landed on invoices. Take $43 times 40 and divide it by 26, and you get about $66 an hour of labor. Run the same arithmetic with last month's payroll hours and invoiced hours for each tech and you have your own version of that $66. That's the twenty minutes I promised.

Is $66 the rate? No, $66 is labor alone, and the shop still has to be paid for. The rent, the insurance, the phones and the office go on top, divided by the same billed hours. Say the shop costs $1,300 a week to keep open. Divided by those 26 billed hours, that's $50 an hour, and $66 plus $50 is $116 before you've made a dollar of profit.

What about profit? That's the one number in here you get to decide, so decide it on purpose instead of taking whatever is left over. Say you want 15 percent on top. $116 times 1.15 is about $133, and $133 is what goes on the ticket. That's a rate. Write it on the wall of the shop if you have to, and stop guessing.

How to charge for the truck and the drive

Does the truck get its own number? It does, and it only needs one. The standard business mileage rate is 76 cents a mile, and that one figure covers the four things a truck costs you: gas, tires, insurance, and the truck wearing out. A 20-mile round trip across the county is $15.20 before anyone opens a toolbox. Put it on the ticket as a trip charge or fold it into the first hour. I prefer the trip charge, because nobody argues with a line that says what it is.

Flat rate or time and materials in Pennsylvania

Which one should a small shop use? I'd use both, on different jobs, and Pennsylvania has a say in how you write the second one.

Flat rate means one price for the task, quoted before you start. You build it from the rate you just worked out, $133 in the example, times the hours the task takes. You don't have to guess those hours either. There's a published database of average installation times, and it's a fair place to start until your own job history is better. Flat rate fits the work you do over and over, like water heaters, fixture swaps, panel upgrades and a furnace replacement.

Time and materials means an hourly rate plus the materials, and the customer pays for what the job takes. It fits the job where nobody knows what's behind the wall until the wall is open.

Pennsylvania's home improvement law has a rule about time and materials, and it changes how you write the paper. A time and materials contract for home improvement work has to do four things:

• State your written estimate in dollars. A number said out loud in the driveway doesn't count.
• State that the final cost may not go more than 10 percent above that estimate.
• Print that ceiling, the estimate plus 10 percent, in dollars, so the owner can see the most the job can cost.
• Say that going past the ceiling takes a change order signed by you and the owner.

Without those terms, the contract has to state a total price.

So which is safer? Your estimate does the pricing work either way. Get the estimate right and flat rate is the shorter road to the same place. Get it wrong and time and materials covers you for 10 percent and not a dollar more without a signature.

Sales tax on materials for a Pennsylvania contractor

Do you charge the customer sales tax on a plumbing job in Pennsylvania? No, and the rule has three parts. You pay the tax when you buy the material at the counter. You don't charge the customer sales tax on the job. And you build what you paid into your price, where it never appears as its own line on the estimate.

One more thing about materials, because it quietly eats a margin. Price them at what they cost to replace this week, not what they cost the last time you stocked the truck. The counter price has moved since then, and your quote should move with it.

What the homeowner has already read before you quote

By the time you ring the doorbell, the homeowner has typed the job into a phone, and some of what came back is on this site. The post on what electricians charge per hour in Berks County carries the national band of $50 to $130 an hour, which is what a homeowner sees first. The post on furnace replacement cost in Berks County puts a furnace at roughly $2,800 to $6,900 installed.

Will your quote land inside those bands? It will land inside them or above them, and either is fine, as long as the quote explains itself. Itemize the labor so the homeowner can see the hours. Name the brand and model on the box so the price is attached to something they can look up. Put the permit on its own line at the township's fee so it's plainly a pass-through. The range came from a website with no reasons attached. Your quote has reasons, and you're the one standing in the kitchen who can explain them.

Put the rate on paper and use it on every quote

Gut feel got you through the first year, and I'm not going to pretend it didn't work. The year you hire a second tech is different, because the second tech will quote from gut feel too, and it will be their gut, not yours. That's the day the rate needs to live somewhere other than your head.

There's a contractor estimate template for Berks County on this site with the materials list, the permit line and the change-order sentence already on it. Fill it from the numbers on this page and every quote that leaves the shop gets built the same way. Then make sure the customer can find you the second time. Add or claim your free BerksConnect business page so the next call starts with your name instead of a search box.