How to price your services: a complete guide

The base formula: materials + labour + margin

Many providers price jobs "by feel", based on what they usually charge or what they think the client will accept. This works until you accept a job that costs you more than you earn. The solution is a simple formula that ensures every job makes a profit.

Material costs are the most straightforward. Add up everything you'll buy: cable, pipe, paint, MCBs, taps, whatever it is. Use real supplier prices, not guesses. If a length of cable costs R38 per metre at your supplier, use R38, not "about R40".

Labour cost is where most people get it wrong. It's not just time on site. It includes travel (return trip), time buying materials, time creating the quote, and time communicating with the client. If a job takes 6 hours on site but you spent an hour travelling and 30 minutes quoting, that's 7.5 real hours.

Profit margin is what remains after paying for materials and your time. It should sit between 20% and 40% depending on the trade, local competition, and your experience. A provider with fifteen years of experience and a solid reputation can charge a 35% to 40% margin. Someone starting out may need 20% to 25% to stay competitive.

The complete formula: Final price = (Material cost + Labour cost) x (1 + margin). Example: materials R2,000 + labour R3,000 = R5,000 x 1.30 (30% margin) = R6,500.

Common pricing models

Service providers mainly use three pricing models. Each works better for different types of work.

Hourly rate is the most common for repairs and small jobs. The rate varies by trade and region, roughly R350 to R700 an hour for skilled trades in most of the country. To calculate your hourly rate, add up all your monthly fixed costs (insurance, tools, vehicle, fuel) and divide by billable hours. If your fixed costs are R8,000 a month and you work 140 billable hours, your base cost is around R57 an hour. Add what you want to earn per hour and you have your rate.

Price per square metre is common in painting, flooring, and tiling. This model is transparent for the client since they can see the area and the price, and can compare providers on a like-for-like basis.

Fixed price is when you give a total for the complete job. It works well for jobs you've done many times and know exactly what they cost. The risk is yours: if it takes longer than expected, your margin shrinks. But the client likes it because they know exactly what they'll pay.

Pricing mistakes that cost money

There are mistakes nearly every provider makes early on, and some keep making for years. Recognising these is the first step to stop losing money.

Not charging for travel is the most common mistake. If you live 30km from the job, that's 60km return, 45 minutes to an hour of time, plus fuel and wear. Include travel in the quote, either as a separate line or built into the hourly rate. But don't ignore it.

Charging only for time on site ignores all the invisible work: driving to the supplier to buy materials, creating the quote, answering client messages, dealing with the unexpected. If you charge R400 an hour but only count the hours on site, you're giving away a chunk of your time for free.

Undervaluing experience is another common mistake. If you solve in 2 hours a problem another provider takes 6 hours to fix, you shouldn't charge less for being faster. The client is paying for the solution, not the time. Charge a fair price for the solution, not a discount for being efficient.

Not updating prices with inflation also costs money. If you charged R300 an hour in 2023 and still charge R300 in 2026, you're effectively earning less. Materials went up, fuel went up, the cost of living went up. Review your prices at least once a year.

Giving discounts without reason devalues your work. If the client asks for a discount, the answer isn't to lower the price, it's to explain what's included and why the price is fair. If you really want to offer something, remove an item from the quote rather than lowering the price.

Using technology to quote faster

The time you spend writing quotes is time you're not earning. If you spend 30 minutes per quote and do 3 a day, that's 1.5 hours daily, nearly 8 hours a week, spent writing numbers instead of working.

With Prummo, you dictate the quote by voice in about a minute. Say the materials, quantities, and prices, and the app organises everything automatically. Even if you need to adjust a line or two, the whole process takes 2 to 3 minutes instead of 30. By the end of the week, you recover hours you can use for more jobs or for rest.

Quoting speed also affects the prices you can charge. The first provider to respond with a professional quote has less pressure to lower prices. When the client has already received three quotes and yours is the last, comparison and discount requests are inevitable. When yours is the first and well-presented, the price is accepted more easily.

Staged payments also let you maintain fair prices without scaring off the client. Many providers lower prices because they assume the client will find the total intimidating. With a deposit followed by a balance on completion via PayShap or EFT, a R6,000 job doesn't need to feel like R6,000 upfront.

Save items you use frequently as templates. In Prummo, you can save templates with descriptions and prices you reuse across quotes. No need to dictate the same things every time. Saves time and keeps your pricing consistent.