Measuring profitability is crucial for business growth. Job costing in Housecall Pro makes it easier than ever to track and report on the costs associated with each job - giving you the power to make decisions that are right for your business.
Through a powerful suite of solutions, tracking expenses and profits for each job is simple.
Setting Up Job Costing
To start using job costing, navigate to the Job details settings page and click on the Job costing page.
From here, ensure the Show job costing breakdown toggle which will expose job costing calculations on your jobs is enabled.
To get the most out of job costing you'll want to track the following inputs on jobs:
To track labor costs, first make sure your employees are tracking their travel and time on jobs through our time tracking feature. You can toggle on this setting from the Job costing settings page.
Learn more about time tracking here.
Fully loaded rates
Next, in order to calculate actual labor costs employee pay details will need to be configured so that a fully loaded rate can be multiplied by the time on the job. A fully loaded rate includes the base hourly rate of an employee + any additional employer paid costs.
To setup fully loaded rates, select Setup from the job costing settings page next to Labor costs. From here, edit each employee to enter their pay details. You'll first want to enter their base hourly rate which can be entered directly for hourly employees or calculated automatically for salaried employees. Then add in an additional dollar amount or % markup to account for additional employer paid costs such as taxes, insurance, benefits..etc. If you don't know what the additional cost is, you can use our calculator.
ℹ️ Note that all admins can see and edit labor rates, but office staff will need the "View and edit pay details" permission enabled to do so.
Once you have fully loaded rates assigned to your employees and they track their time on the jobs they're assigned to, their fully loaded rate will be multiplied by the time spent on the job (travel to and time on the job site) to calculate actual labor costs.
Material Line Items
Materials costs are another important cost category to stay on top of. Having your pricebook built out with the common material you use will make it easier to track the material going into your jobs.
Learn more about setting up your pricebook here.
To track material costs, add material line items to your jobs and ensure the unit cost field, which is the cost of the material to you (not your customer) is filled out.
If you don't want your customers to see materials line items, simply hide them from the invoice settings.
Learn more about invoice settings here.
Material Job Inputs
If you want to track materials outside of line items in a way that doesn't impact the price of your job you can do so by enabling the Material job inputs setting. This is likely how you'll want to track materials if you're using flat-rate pricing.
When this setting is enabled, you'll see a Job Inputs card on the job details page on web and mobile where material items can be added. These materials will not show up on the invoice or impact the price of the job.
You can also auto-populate material job inputs when flat-rate services that have materials added to them are added to a job.
To auto-populate flat rate materials, navigate to your flat service in the price book. Once materials are added to a service, enable the Track materials on job setting. Once enabled, the materials will automatically show up in the job inputs section of the job when the service is added to the job.
Alternatively, you can also enable/disable this setting for all flat-rate services by checking the setting below the Material job inputs toggle on the job costing settings page.
Jobs may incur costs that don't fall into labor or materials, such as permits, parking, and rental fees to name a few. If you'd like to track these costs separately from line items you can enable the Miscellaneous job inputs setting.
Once this setting is on, you'll be able to track miscellaneous costs on jobs from both the web and mobile apps. These costs won't impact the invoice or price of the job.
Commissions and Upsells
If you have a performance pay structure for your employees, you can turn on tracking for commissions costs which will enable you to assign commission rates to your employees.
Once you've turned on commissions and added commission rates, you'll be able to assign commissionable line items to employees on jobs. Commissions will be calculated by multiplying the commissionable amount of line items by the assigned employee's commission rate.
You can also track upsells on jobs by updating the 'Sold By' field on line items.
You can use the unit cost field on service line items to track service costs as well, although tracking the actual costs of labor, materials, misc costs, and commissions will give you a more accurate breakdown of your job costs and margins. Scroll down to the next section to learn about how service costs can be tracked as expected vs actual job costs.
Expected vs Actual Costs
When you price your services you may be incorporating what you anticipate the labor, materials, and other costs to be in order to price the service in a way that results in a profit. This is especially relevant if you use flat-rate pricing.
Learn more about flat rate pricing here.
If you'd like to report on expected vs actual job costs to stay on top of your margins and adjust pricing as needed you can do so by enabling the Show expected job costs setting from the job costing settings page. Note that this setting is automatically enabled for any pros who have their flat rate price book enabled.
When the Show expected job costs setting is enabled, the unit cost of any service line item on a job will be treated as an expected cost and will be shown under the expected costs section of the job costing breakdown card from the job details page.
Material line items or inputs, miscellaneous inputs, commissions, and labor tracked on the job from time tracking will be calculated as actual job costs and will be shown in the top section.
If your flat rate services are setup in your price book with material and labor costs, those costs will populate automatically under expected labor and material costs. You can also manually input or edit these values on the job if needed which will update the total expected job cost.
Reporting on Job Costs and Profit Margins
As you track revenue and costs on your jobs, you'll be able to analyze your job costs and profit margins from the job details page and in job reports.
The following metrics are available by expanding the Job Costing Breakdown section on the job details page.
Profit Margin = gross profit/revenue
Total Revenue = the job subtotal minus any discounts
Total Job Costs = labor costs (travel + time on job x fully loaded rate of any assigned employees) + material costs + commissions costs + miscellaneous costs + service costs
Total Gross Profit = revenue - job costs
Note: taxes and tips are excluded in all of the above metrics
If you're tracking expected vs actual job costs, you'll be able to report on expected margins, profits, and costs vs actuals as well.
A job costing summary is also available on jobs on the mobile app by default for admins and office staff.
Aggregate job costing reporting is also available on the jobs tabs in reporting. To view the aggregate reports, navigate to Reporting > Jobs. For details on the job costing reports, reference the Job costing reporting article.
Admins and office staff will be able to see job costing information on each job by default. If you'd like your field techs to see job costing details on their jobs you can turn on the ‘See job costing margins and inputs’ permission from the employee details page. You can also turn off this same permission for your office staff.
Learn more about permissions.
When job costing is on, you'll also be able to track basic unit costs on service and material line items along with the expected profit margin on estimates.
Want an in-app walkthrough of these new features? Click here!