HVAC jobs price two ways: flat rate (a set price per task) or time-and-materials (hours × rate + parts). Comparing the two shows which fits a job — and protects margin.
The example
$320 flat vs 2 hr × $130 + $80.
| A | B | |
|---|---|---|
| 1 | Model | Price |
| 2 | Flat rate | $320 |
| 3 | T&M (2h+$80) | → $340 |
The formula
The formula:
How it works
How it works:
- Flat rate = a fixed book price for the task — predictable for the customer.
- T&M = hours × labor rate + parts — tracks actual effort.
- Compare with IF to see which is higher on a given job.
- Flat rate rewards efficiency (faster = more margin); T&M protects on long jobs.
Flat rate transfers the time risk to you — on purpose. A book price means a fast tech earns more per hour and a slow job costs the customer nothing extra; T&M does the reverse. Flat rate also removes the awkward clock-watching and is easier to sell. Build flat prices from realistic average times plus parts and margin, and keep a T&M fallback for diagnostic or open-ended work where time is genuinely unknown.
Try it: interactive demo
Flat rate vs hours, labor rate, parts.
Variations
Which is higher
Compare:
Flat-rate effective hourly
Margin lens:
Break-even hours
Where they cross:
Pitfalls & errors
Realistic flat times. Build book prices from true average task times.
Parts in both. Don’t forget parts in the T&M side.
T&M fallback. Use T&M for open-ended diagnostic work.
Practice workbook
Frequently asked questions
How do I compare flat rate and T&M in Excel?
What's the effective hourly on a flat-rate job?
When should I use T&M?
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