How do I track job profitability for a plumbing business?
Every job needs to be set up as a separate project in your accounting software. When you finish a drain cleaning or a water heater install, you should be able to pull a report showing exactly what that job cost versus what you billed. Without this job-level tracking, you only know if the month was profitable, not which jobs made money and which ones lost it.
Labor is usually your biggest cost, so track hours by job and not just by day. When a technician works on three calls, those hours need to be split across all three jobs. Include travel time because a two-hour repair with 45 minutes of windshield time is less profitable than the same repair 10 minutes from your shop. Unbillable hours like returning to the shop, restocking the truck, or callbacks also need tracking so you understand your true billable efficiency rate.
Materials tracking is where most plumbing businesses leak profit. The $200 water heater you bought for the Smith job is easy to track. The $47 in fittings, connectors, and tape your tech pulled from truck stock is where things get fuzzy. Every part that comes off the truck needs to be logged against the job. Some shops use scanning systems or end-of-day material logs. The method matters less than the consistency. If techs don’t report materials daily, you lose visibility into actual job costs.
Overhead allocation turns your job cost from incomplete to accurate. Your trucks, insurance, tools, shop rent, and phone systems all cost money whether you run one job or twenty. Calculate your monthly overhead and divide it by billable hours to get an hourly overhead rate. A shop with $9,000 in monthly overhead and 450 billable hours has $20 per hour in overhead that should be added to labor costs on every job.
Service calls and project work need different approaches. Plumbing and trades businesses often mix quick repairs with larger installations or new construction. Service calls live or die on efficiency and call volume. Larger projects need tracking by phase with material lists and labor budgets you can compare against actual performance.
Review job profitability weekly, not monthly. Pull a report of completed jobs and look at gross margin on each one. When you see that emergency drain calls consistently make 60% margin while water heater installs barely break 20%, you know where to focus. Maybe your water heater pricing is too low. Maybe installs take longer than you estimate. Maybe certain technicians are faster than others. Weekly reviews surface these patterns while you can still adjust.
The payoff from job costing is pricing accuracy. After six months of data, you stop guessing what to charge. You know exactly what a slab leak repair costs you in labor, materials, and overhead. You know which zip codes are profitable because travel time is shorter. You know which job types to market and which ones to price higher or stop taking altogether.
If setting up job tracking feels overwhelming alongside running service calls, a bookkeeping service in Macomb can configure your QuickBooks properly and show you how to code jobs so the reporting actually works. The system only needs to be built once. After that, consistent data entry gives you the numbers to make smarter decisions about your business.
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