“Dear Mr. Blau, I am going into business for myself, and need to know how to figure out my hourly rate. I recently ordered Ellen Rohr’s new book, and she recommended I purchase your book, too. Will your book instruct me on exactly how to figure an accurate hourly rate and a selling price? I plan to go with flat rates as soon as I can afford to purchase your flat rate system.”
Imagine going into business without enough capital even to purchase some basic instructional books. This statement tells a lot about our industry. It is open to anyone with a plumbing license — or even without one — and mechanical skills. And this is the source of our biggest problem. People enter the field without knowing a thing about business economics. They are playing a big guessing game with their prices and end up buying themselves most jobs.