Companies all over the counrty have been bought out; yet the name and label of “locally owned” stay the same. The switch of pay to commission only and bringing the number of staff down to save as much money as possible, and get rid of apprenticeship programs. The prices sky rocket and begin to offer financing options. The cost of business has gone up, but plumbing is still affordable for most people but they’re feeding share holders and investors at the cost of homeowners and small businesses. Done all over the country and for so long even local owners have raised the prices in fear of missing out on the profits. This is where home owners and small business owners face being taken advantage of.

It starts with understanding this is a formula.

Hourly Rate=Billable HoursAnnual devided by Overhead+Annual Labor Cost+Desired Profit​. Lets do an example. Let's say:

• Owner salary: $100,000

• Payroll taxes/insurance: $15,000

• Rent and Truck payment, fuel, maintenance: $18,000

• Insurance: $6,000

• Licensing, software, phone: $4,000

• Marketing: $12,000

• Miscellaneous expenses: $10,000

• Desired profit: $50,000

Total needed revenue = $215,000 in overhead+ annual labor costs+desired profit. Then divided by total 1200 billable hours. Resulting in 180 an hour as the honest hourly rate.

Ours is 240.00 an hour. It allows us to stay around for years to come. The more trucks are on the road the more billable hours but the bigger the fixed costs a year. Now imagine a water heater install. parts rough out to 1200 to 1600. and takes 2 to 8 hours. 1600+1920=3520.00 and this is the higher end number. Most Companies are ripping people off.

These companies being bought are usually by PE. Pipe dream ventures with Albert Nahman in the East Bay. The Bonney family with Big Air in Concord. Apex with Jazz home services in Pleasanton. And unfortunately many more.

This market even has real locally owned companies feeling like they need to compete. Like Chosen Rooter and Plumbing in the sunset in San Francisco. and Flow Pro Plumbing in Brentwood.

You still have honest folks priced properly and great service. Letts plumbing in Concord. Amesos Plumbing in San Rafael. Guaranteed Plumbing in Lafayette.

They’re the big reason why this evolved from techs selling the work to a salesman selling the work and apprenticeships disappearing. To maximize profits and minimize liabilities with minimal support out in the field for uneducated plumbers with a commission paid mindset all at the cost of the customers.