MENU PRICE GUIDE UPDATING
By: Don Glovan
W hat is the Menu Pricing Guide and why is a detailed pricing structure important? Your Menu Pricing Guide has the services you offer and the pricing it needs to be at for you to earn a profit from your investment into the business. When you originally started, you calculated all your costs, added profit and then you were done…at that moment. However, costs change over time; material increases, new equipment leases, added employee benefits, added office staff, added marketing campaigns, etc. All of these costs, and more, affect the financial suc- cess of your company. If you don’t include these additional costs in your selling price, they must be paid for somehow…it’s like reaching in to your pocket and paying for them with your personal money, bad news and the wrong way to run your business. Here’s the good news, you can account for those additional costs in a few easy steps and have your new selling price on the street in 24 hours! You’ll need to have the following items to update your pricing; 1) Your current budget, 2) The MPF Calculator, 3) Access to your ServiceTitan Pricebook. Utilizing your current budget (What??? You don’t have a budget…contact your Franchise Consultant to assist you with this!) to complete the MPF calculator. The calculator has three sections to complete using your budget.
Inside your ServiceTitan, your Pricebook will have several tabs. For just updating your Menu Pricing Factor, go to the Price Setup tab. You can update your pricing globally for all services in your price book. Or you can update just a category or sub-category. Once you’ve entered your data and press Next, you have the opportunity to review each service for current pricing and new pricing. If all is good, press Save and your Pricebook is updated and available for your technicians to download to their iPad. For updating materials, got to the Materials tab for access to individual material items. Once your materials have been updated, you need to continue with the same process of updating your Menu Pricing Factor by: Globally, Category or Sub-Category, followed by a review of the Current pricing and New pricing. By following these steps, you’ll have the most up-to-date Pricebook in your technician’s hands and have you earning the profit your investment has been designed for. Contact your Franchise Consultant for more information. Keep in mind there are many factors in having a profit besides planning for a profit. Always keep your bookkeeping and accounting practices current, monitor your jobs costs & labor costs on every job. Whenever you have an added expense in any area of your business, they must be included in your cost of doing business.
Section 1) The fixed costs or G&A portion of your budget, including any debt you owe. A
fixed cost is anything you have to spend money on every month regardless if you generate revenue or not, such as rent, advertising, office staff payroll, insurance payments, etc.
Section 2) The variable costs, or cost of goods sold,
portion of your budget. A variable cost is anything related to a call for service, such as technician pay, vehicle fuel, material, equipment rental, permits, drain maintenance products, etc.
Section 3) Final calculations. In this section you will add for your profit percentage, number of vans running service or doing
installations and your team’s efficiency. The end result will be the standard rate in your Pricebook.
“Always keep your bookkeeping and accounting practices current, monitor your jobs costs & labor costs on every job.”
14 PIPELINE® | EDITION 2 2017
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