Changes to the cost of HVAC materials, labor, and overhead can happen very fast. Whether you are a residential or commercial HVAC industry contractor, one of the most critical aspects of running an HVAC business successfully involves creating an effective pricebook and keeping it up to date.
Your pricing strategy for HVAC services and equipment can directly affect your bottom line, customer satisfaction, and overall business growth.
But, manually creating pricebooks is hugely time-consuming. That’s where ServiceTitan comes in.
ServiceTitan's pricebook features let both residential and commercial HVAC companies set up a pricebook and pricing structure in a matter of minutes, whether you are starting from scratch or have an existing pricebook. It saves you time by updating prices in real-time, after you quickly set up rules and automatic pricing for your materials.
In this article, we discuss six essential tips for creating an effective HVAC pricebook.
Tips for Creating an Effective HVAC Pricebook
Throughout, we’ll also give you details of how ServiceTitan makes pricebook management fast and easy by connecting directly to other tools you need to run your HVAC or other field service business, including creating estimates and proposals, invoicing, accounting, and more.
Before we dive into the tips, though, we'll first look into the importance of an HVAC pricebook, and how keeping yours up-to-date is essential for your business.
If you’d like to learn more about how ServiceTitan can make pricebook management easier for your HVAC business, you can learn more or request a free demo here.
Understanding the Importance of an HVAC Pricebook
An HVAC pricebook is a comprehensive list of all the products and services your business offers, along with their associated prices. For residential HVAC, that typically means flat rates for specific jobs; for commercial, it usually means labor and materials rates. Regardless, a well-organized and up-to-date pricebook allows you to streamline your business operations, enhance the customer experience, and increase profit margins.
Having a well-organized HVAC pricebook is essential for any HVAC business. It provides a clear and concise list of all the services and products you offer, along with their prices. This streamlines your business operations and enhances the customer experience.
Streamlining Your Business Operations
An effective pricebook enables you to streamline your business operations by making it easy for your team to provide quotes and invoices.
With every service and product priced correctly, your HVAC techs and sales representatives can easily access the necessary information to help them during the sales process. This streamlines the sales cycle, increases productivity, and enhances overall HVAC business efficiency.
When your HVAC team has access to an up-to-date pricebook, with correct prices for hourly rates and materials, they can quickly and easily provide accurate quotes to customers. This saves time and reduces the risk of errors, allowing your team to focus on providing exceptional service to your customers.
Enhancing Customer Experience
Having a well-organized pricebook also improves customer experience. Customers, whether they are commercial or residential, always appreciate straightforward pricing that's easy to understand.
An up-to-date pricebook allows you to give precise quotes for services and equipment, including offering a flat-rate pricing system for residential customers. This ensures customers pay the correct amount and cover the total cost of the service, without surprises or hidden charges. This transparency increases their confidence in your business and leads to customer loyalty, positive reviews, and referrals, helping grow your business over time.
Increasing Profit Margins
An effective pricing strategy also plays a vital role in increasing your HVAC profits. A clear and concise pricebook helps to set prices based on the cost of labor, materials, and overhead, ensuring that you don't undercharge and run at a loss. Setting the right prices for your services and products also enables you to increase your profit margins.
Additionally, by regularly reviewing and updating your pricebook, you can ensure that your prices are competitive and profitable. This allows you to increase your profit margins, reinvest in your business, and provide better services and products to your customers.
1. Make Your Pricebook Easy for Your HVAC Technicians to Use
Your HVAC pricebook template needs to work well for your HVAC technicians. Managers and owners sometimes set up pricebooks for office operations, without ever consulting with their techs or trying to understand how they use the pricebook on service calls. Your HVAC pricebook needs to function really well for the technician’s brain, not your brain.
“If a technician is unfamiliar with a pricebook or they have too many choices for similar items, they start getting nervous in front of a customer because they kind of feel stupid, and we don’t want that to happen,” says Nielsen, who often trains techs on new software, including ServiceTitan.
Most HVAC pricebooks function like a tree, Nielsen explains, with the trunk or base of the tree serving as the foundation for all of your HVAC service options. The bigger branches show the subcategories, such as an air conditioning or furnace tune-up, and the leaves on the tree detail the specific tasks involved, such as “replace a pressure switch” or “install a blower motor,” as well as how much time each task takes to perform — and the cost.
As your technicians move up the tree, your pricebook needs to clearly outline each task, the materials involved, the price guide for service and materials, and the estimated time it will take. ServiceTitan helps automate all of that so techs and managers can focus on their jobs instead of spending time updating the pricebook.
ServiceTitan Mobile: Giving HVAC Techs Access to Pricebooks and More
The easier your pricebook software is to use, the fewer delays and stumbles that will happen in front of the customer. ServiceTitan’s field service app, available on Android and iOS, was designed to be extremely intuitive and easy for your HVAC techs to use.
For example, it gives HVAC technicians, business owners, and office staff, tools to create Good-Better-Best proposals using the prices and services included in their pricebook.
Techs can build their estimates and proposals directly on their mobile devices (e.g., iPhone or iPad), without leaving the customer’s premises. They can choose to use estimate templates for the most commonly offered services and customize them for each new customer, or build their own from scratch.
Because the ServiceTitan pricebook features high-quality photos and comprehensive product details, techs can easily show products, packages, and services to the customer right on their tablet.
The customer, whether they are a homeowner or a commercial business, can immediately choose the service they want, without waiting for an estimate to be calculated back at the office. Techs can then create work orders, offer customer financing, generate invoices, and even collect payments before they get back in their van, right within the ServiceTitan app.
“We all know the more times a technician offers options and educates the customer, the more money that can bring in for the business and the technician,” Nielsen says.
2. Set Up Your Pricebook Correctly From the Start
One of the biggest mistakes companies often make when setting up their HVAC flat-rate pricebook is not realizing how important it is to the overall operation of their business.
“It drives everything in your company. It’s your complete foundation,” Nielsen says, explaining how problems occur in the set-up stage of the HVAC pricebook because owners tend to focus on the future and not on the now.
Initially, Nielsen says, some service companies worry too much about linking all of their tasks with the materials used, but then find the tasks aren’t built well because they’re too confusing or the template doesn’t include enough of them. Focus on building a strong foundation of well-defined tasks first, and then link to the materials (all of those pieces and parts your technicians use to stock their trucks).
“Instead of trying to eat the whole cake, do it a bite at a time. Choose your top 20 to 50 tasks and get those tasks really great,” she says. “When you’re adding materials, choose materials by cost. Start out with the high-dollar cost items first.”
Keep in mind, your “equipment” (a furnace or air conditioning unit with a model number and serial number) should not be considered “materials” for your business’ reporting purposes. Documenting both correctly helps to keep your pricebook simplified.
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Another very common mistake made in HVAC flat-rate pricing books is allowing techs to choose a “miscellaneous task” as the type of service provided to a customer. It’s typically a generic task or service with no real description or price. A tech may choose the miscellaneous option because they don’t want to look up a particular item or your HVAC pricebook includes too many choices and they don’t know which one to pick.
“When we use miscellaneous too often, it will not give us reportable data,” Nielsen says. “I can’t figure out if I need to stock more of a particular item or add it to their truck stock if it’s always listed as miscellaneous.”
A dishonest tech also might take advantage of the miscellaneous option in your HVAC pricebook.
“Maybe he goes in and does a lot more services than he used specific tasks for, but when he puts it in as generic and changes the price, he might be pocketing money from the customer. It’s keeping honest techs honest,” Nielsen says.
Specific tasks and prices also provide better transparency for the homeowner, who may ask for a detailed history of services for insurance purposes.
How to Build the Best HVAC Pricebook for Your Team Using ServiceTitan
With ServiceTitan, there are several ways to start building your HVAC pricebook in a way that your techs will find easy to use and understand:
Upload a pricebook that you already use via .xls file. You can then manage it and add to it through ServiceTitan.
Create a pricebook from scratch by adding each part or product individually. This is a great option for small businesses that offer just a few types of HVAC services to customers.
Opt for ServiceTitan’s Pricebook Pro catalog. This is a great option for HVAC businesses focused on residential services as it comes with multiple pre-built, flat-rate HVAC services to save you tons of time on building a pricebook. (We discuss Pricebook Pro in detail below.)
Keep Prices Updated with ServiceTitan’s Pricebook Editing Features
As any HVAC business owner knows, the price of products and materials can change multiple times a year. HVAC contractors need to keep abreast of these changes or risk the profitability of their business. This means changing prices in the pricebook as soon as they occur.
The majority of apps, and other HVAC software, require you to export the list of items in the pricebook, make changes one-by-one using formulas and then plug all the new information back into the platform. This is hugely time-consuming and often means that pricebooks don’t get updated as often as they should.
ServiceTitan allows you to filter your list of items and provides editing tools so you can change prices individually or in bulk. The Dynamic Pricing feature, included with our add-on product Pricebook Pro, also lets you set rules to automatically update your pricing whenever material costs or labor rates change.
Here are the ways you can update your pricebook in ServiceTitan:
Edit Individual Items
Pick each item individually within the pricebook, and make as few or as many changes as you want to the price, description, or images.
The bulk editing feature allows you to apply changes and markups to multiple items, services, products, and materials throughout the entire pricebook. You can also select categories of items, products, or services to receive the specified changes.
The changes you can make include:
Add or remove images
Add or remove a category
Add or replace item descriptions
Add or remove a primary vendor
Add or remove time increments to all items selected
Increase, decrease, or set prices as a flat amount or percentage
Finally, to save you even more time on pricebook updates, ServiceTitan's Pricebook Connect feature, which is part of our core software offering, allows users to access leading supplier catalogs and seamlessly connect them with their pricebooks.
When prices, product descriptions, and images change, you can either be notified or have the pricebook changes automatically implemented.
3. Include Coupons and Discounts in Your Pricebook
If your HVAC company offers coupons and discounts, make sure your HVAC pricebook template is set up correctly so techs in the field understand how to utilize those incentives when interacting with every type of customer.
For Nielsen, a coupon is different than a discount, so each should have its own company account for best reporting practices.
“When I manage a company, I want coupons to hit separate accounts than discounts. In my opinion, a coupon is more of a marketing tool and a discount is something we had to give away to make somebody happy or to win a sale,” she says. “I want to know financially how much I had to give away in revenue in a discount form vs. how many people are responding to coupons that we have out there on the internet, through direct mail, part of a welcome wagon, or wherever.”
It’s also important for technicians using your HVAC pricebook to properly track any coupons or discounts applied to a particular customer’s account as a way to build value for the service. If the technician simply changes the price of the task or service and fails to document the use of a coupon or discount, the customer may call your shop and demand the coupon or discount be applied, even though it was already built into the price they paid.
ServiceTitan Pricebook Pro Comes with Coupon and Discount Alerts
ServiceTitan’s Pricebook Pro add-on allows business owners to set up an alert to the service manager whenever their technicians use a certain coupon or discount. The automatic alert allows the service manager to know what’s happening in the moment and have a conversation with the tech to understand why they are offering the coupon or discount to a particular customer.
Did the technician fail to make the customer happy or use an incentive to build value for the service? Using the Pricebook Pro alert feature, the service manager can react to each scenario in real-time and control the giveaways.
4. Set Up Specific Pricing for Commercial Clients
If you have service contracts with commercial clients, it's likely you'll have negotiated a specific deal for each of them. This invalidates your usual flat-rate pricing, or even standard commercial client pricing, so your pricebook needs to make it easy for HVAC techs and back-office staff to price and invoice accordingly.
ServiceTitan offers client specific pricing where you can easily create individual rate sheets with custom rules and markups.
Client Specific Pricing makes sure you charge the right price for every one of your clients. Using the individual sheets, instead of having multiple pricebooks for multiple clients, ServiceTitan automatically calculates the correct price to charge the client, eliminating the possibility of charging the wrong rate.
5. Add ServiceTitan Pricebook Pro to Cut Through Residential Pricebook Complexities
Most pricebook software requires users to search for product details, descriptions, and images online and to add each of these to their new pricebook separately. By opting to subscribe to ServiceTitan’s Pricebook Pro — which comes with ready-made content, descriptions and images — business owners can cut through the time and hassle of building a pricebook from scratch.
“If you’ve ever had to add them in, it’s very time-consuming to go out on the web and get all those pictures and save them and upload them,” Nielsen says. “The beauty of this is that it’s already done for you.”
Pricebook Pro provides a well-built HVAC pricebook from the start, and the prices included are based on industry average prices and best practices, so you don’t have to spend countless hours tracking down and inputting prices from your catalogs, or online. All prices can be adjusted, however, and you can change these base prices as needed.
By using Pricebook Pro, you also get a wide range of pre-built flat-rate services, and the ServiceTitan team monitors supplier prices and makes adjustments to the pricebook on a monthly basis. You can choose to add your own markup, or pause automatic updates, if you prefer.
HVAC techs out on a job can use Pricebook Pro to show customers detailed descriptions of products and services, present tailored good, better, and best proposals and make use of the unique features of Pricebook Pro, including:
Upgrades and recommendations which allow the HVAC technician to show customers a good option for repair or replacement as well as possible upgrades for better and best options, along with recommendations for all of the required parts.
Pricebook categories by technician which limit what each HVAC service technician sees in the HVAC pricebook so they only access information relevant to them, eliminating errors when discussing sales options with customers.
Pricebook Wizard which allows you to set your company’s markups and labor rates, while ServiceTitan’s built-in feature calculates what prices to charge for each service.
Service descriptions and images which give your HVAC technicians the ability to search for specific service descriptions with easily recognizable images when discussing repair or replacement options with a homeowner. While this feature comes standard in many pricebooks, Pricebook Pro includes detailed descriptions and vivid images already built-in.
Dynamic Pricing: Automatic Changes Across Your Pricebook
The Pricebook Pro Dynamic Pricing feature makes managing your pricebook even easier by allowing you to apply automatic price changes.
You can establish rules so that prices automatically update within your pricebook whenever labor rates and cost of materials change. This saves countless hours of inputting new prices, as well as keeping prices updated in real-time, so that estimates and proposals reflect the new cost of every applicable item.
Dynamic Pricing can also be set up to take into account “rush charges” or “after-hours” fees when work is done outside of normal business hours.
All these Pricebook Pro features are designed to automate pricebook management processes, allowing you and your team to focus on other areas of your business.
We surveyed ServiceTitan users who have signed up to use Pricebook Pro and found that using it increased their year-on-year revenue by an average of 13%.
6. Connect Your HVAC Pricebook to the Rest of Your Business Processes
Most currently available HVAC pricebook software is a third-party solution that doesn’t integrate with other HVAC contractor software. This means HVAC business owners and their teams end up spending a lot of time transferring information between different platforms or apps, like those used for accounting and invoicing, for example. If there are delays in doing this, or the wrong pricing information is added to your HVAC pricing guide, your techs will be working with, and charging, old prices until the situation is rectified.
To avoid this situation, you need to make sure that all of your company’s data reporting feeds from your pricebook and any cost information listed on invoices comes straight from your pricebook in real-time.
“If your techs are writing what they used on a piece of paper, it’s probably a guess, because they’re probably doing it at the end of the day,” Nielsen says. “I’ve been in shops before where they did it once a week. That is a guess! A digital HVAC pricebook makes it really accurate for you and your reporting.”
Using data from the HVAC pricebook makes it easier for your techs to provide solid service estimates to customers, and eliminates any grumbling or guesswork.
Most reporting discrepancies and issues will come back to haunt your workflow, so be sure to set up your HVAC pricebook correctly before things get out of hand. Ensuring your pricebook is integrated with all your other business processes (dispatch and scheduling, for example) gives you peace of mind that pricing and reporting is accurate across the board.
“Volume will cover up a lot of problems for a while, but if you get a handle on your pricebook sooner rather than later, then your foundation is strong and stable,” Nielsen says, “and your reporting, accuracy, and everybody’s workflow is correct.”
How ServiceTitan Connects Your Pricebook to All Your Business Operations
ServiceTitan users who opt to stick with the core pricebook features and those who choose the Pricebook Pro add-on have their pricebook connected effortlessly to all their other business operations. This begins with the estimates and proposals that techs present to customers on site.
Once a customer decides on the estimate they want, the following processes can be carried out within ServiceTitan automatically, without manually transferring any information from the estimate:
Generating electronic purchase orders and requisition of equipment and materials.
Accepting check or credit card payments via the mobile app or customer portal. (This is great for your HVAC business cash flow.)
Creating and sending email invoices. (Invoices are stored in the cloud instead of on paper and are immediately sent to your back office so they are easier to keep track of.)
ServiceTitan also integrates with Intacct and QuickBooks, so there is no need to change your current accounting software. These integrations make the invoice reconciliation process much simpler, and you don’t need to check if all the information has been correctly transferred between apps.
ServiceTitan also includes integrated tools for multiple other processes, including:
By having all these processes integrated in a single platform, HVAC businesses can streamline operations, improve efficiency, and spend more time on revenue-generating activities.
ServiceTitan: Streamline Pricebook Management for Residential and Commercial Clients
Creating an effective HVAC pricebook is crucial to the success of your HVAC business. By understanding the role of an HVAC pricebook and implementing ServiceTitan to run your business, you can set prices that accurately reflect your services and equipment costs, enhance customer experience, increase profit margins, and grow your HVAC business over time.
Discover what implementing ServiceTitan can do to streamline your operations, increase your bottom line, and improve your customer service. Schedule a call to get a free, personalized demo of our all-in-one software solution for contractors now.
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