Pricing

Letting Somebody Else Bid Without Handing Over Your Margins

By Travis Evans, Founder of TradeGOAT · 20+ years in the trades

My name is Travis Evans and I own Evans Elevator Company in Crandall, Texas. For the first couple of years on my own, I was the only person here who could price a job. That was not me guarding anything. The numbers lived in a spreadsheet I had built up over years, and a lot of what made it work had never been written down anywhere. What I really pay for labor once the truck is in it. Which kinds of work need a heavier margin because they always go sideways. What I quietly add for a customer who takes ninety days to pay.

It holds up fine until the week it doesn't. Usually it shows up in ordinary ways.

A customer wants a number Tuesday and you are on a jobsite until Thursday.

Your office manager could do the whole takeoff. She knows the customer and she knows the building, and she still stops at the price, because that part is yours.

Quotes get done Sunday night, because that is the only stretch of hours when nobody is asking you something.

You take a week off and bids sit in a pile waiting on you.

You start thinking about who runs this someday and it dawns on you that the pricing walks out with you.

The reason it stays that way is not complicated. Handing somebody your pricing usually means handing over the spreadsheet, and the spreadsheet has everything in it. Your labor cost, your margin, what the job actually makes. Most owners I know would happily let a good employee write bids all day long. What they will not do is publish what they make on every job to whoever is sitting at that desk this year.

Building a bid and seeing the margin are two different permissions

In TradeGOAT those are two separate switches, on purpose. One is called Build proposals, and it means creating and editing proposals and bids. The other is called See costs & margins, and it means the labor margin, the material markup, and the cost structure sitting behind a price. You can hand out the first one without the second.

Somebody holding only the first one opens a new proposal, picks the customer, picks the service, and enters what the work takes. A price comes out, calculated on your rate and your margin. He can read that price, put it on the proposal document you have always sent, and get it to the customer. What he does not get is the panel underneath it that shows what the job costs you and what is being made on it.

Which of your people holds which switch is set on your roles screen, and it is your decision and nobody else's. The tool does not sort your employees into who ought to see money. It does what you told it and stays out of the rest.

Your rates stop being something you remember

For any of that to work, the numbers have to be in the tool instead of in your head, and that is one screen. Under Settings there is Pricing by service. Every service you sell has a row, and each row shows the labor rate and the margin that service will bid at.

Two levers, because those are the two that actually move the number. You set a company rate and a company margin once, and then any service can carry its own instead when it needs to. Service calls at one rate, a modernization at another, and the small stuff at a margin you deliberately set higher because a half-day job still eats most of a day.

When a bid gets built the tool goes looking for each number the same way every time: whatever was entered on that particular bid, then whatever that service carries, then your company default. The first one it finds is the one it uses. That order never changes, so a price is always traceable back to a setting somebody made.

Every number says where it came from

Beside each number on that screen is a short word telling you whose decision it was. Company rate means it came from your company-wide setting. This service's rate means somebody set it for that one service specifically. And where nobody has set a margin at all, the screen says it is not set, and calls the number it is using the tool's starting point. A tool having an opening number is not the same thing as you having picked one, and it does not pretend otherwise.

The labor rate works a little differently and I think it should. There is no starting number for it. If nobody has entered a labor rate, the screen says not set and leaves the space for you.

That sounds like a detail. It is the part that makes the whole thing usable a year from now, when a bid comes back at a number you did not expect and you want to know why. You open that one screen and read which of your own settings produced it.

What it looks like on a Tuesday

Your office manager takes the call at ten in the morning. She opens a new proposal, picks the customer, picks the service, and enters the parts along with the crew hours she gets from your lead man over the phone. The price comes out on your rate and your margin, because that is what that service is set to.

She puts it on the same proposal document you have always used and it is out before lunch. You were in a machine room the entire time, and the number that went to the customer is the number you would have written.

The part that matters more than the day-to-day

Getting quotes out the same morning is the obvious benefit, and it is not the real one. The real one is that your estimating stops living only in your head.

Anybody in your company who can price parts and estimate crew hours can bid the way you bid, without ever knowing your math. That is a different company than one where the owner is the only person who can put a price on work. It is worth something the week you want off. It is worth a good deal more the day somebody asks what your company is worth with you not in it.

This is the same idea as pricing every job the same way, carried one step further. Getting consistent with yourself is the first half. Getting it out of your head so the company owns it is the second, and it is the half most of us never get to.

Straight about where this stands

This is in the tool now. Pricing by service is under Settings, the two permissions are on the roles screen, and the source word beside every pricing number is there to read.

The catch is that it is only as good as the numbers you put in it. The tool will faithfully bid at a labor rate that is ten dollars low, all year, and never mention it. So sit down once with the rates you actually use, put them on the services they belong to, and then run a job you already sold through it and see whether the price comes out near what you sold it for. That hour is basically the whole setup, and it is also the fastest way to find out whether the rate you have been using is the rate you needed.

If you want to talk through how your services ought to be split up before you set any of it, I am happy to do that with you. You can reach me through the site anytime.