Pricing Adjustments - 7 Ways to Protect HVAC Profits During Uncertain Times

Written by Intelligent Mobile Support Team | Apr 5, 2022 4:46:12 PM

Seven Ways to Protect Profits

 

  1. Overall Price Adjustment. Adjust you price across the board. You can use a percent (e.g., 5%) or dollars (e.g., $500).
  2. Overall Job Costs. Add a recommended job cost (e.g., $500) to Install Manager Pro. As a recommended item has the advantage (disadvantage) that it can be turned off at the point of sale.
  3. Brand (OEM). Adjust margin or markup (e.g., 5%) for “at risk” brands.
  4. Type (e.g., AC, Coil) Adjust margin or markup (e.g., 5%) for “at risk” equipment.
  5. Labor. Adjust margin or markup on your labor rate.
  6. Install Kits. Adjust dollars to your install kits where appropriate.
  7. Keep Your Pricing Up to date. Re-import distributor cost files on a quarterly basis. Remember this doesn’t cover your inflation risk for the next 7 to 30-days – so consider one of the other methods as a backup plan to protect your profits

To protect profit margins from these fluctuations - We have several different ways to adjust pricing

Global Price Adjustment:   Sales Builder Pro has a price adjustment option that affects all parts (materials?), labor, and equipment.   This is best used when all costs are going up and is easy to adjust - This adjustment is applied to the after-margin total of equipment, labor, materials, and tax is calculated.

 

 

Price Adjustment to Category/Class/Manufacturer:   If an adjustment is just needed to a category of products - it can be done with a pricing rule for the product category.

 

There are additional ways to adjust pricing - You can simply increase your total gross margin and it has the same effect as a Global Price Adjustment.  

Any one of these methods will help account for fluctuations in price over a quarter. Updating your actual cost whenever there is a change is still certainly the best method and should be done whenever feasible - but with the frequent price fluctuations that have been a regular occurrence.  A margin adjustment is very quick and will protect your profits.

 

 

 
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