Team ServCraft

How to work out your charge out rate - a guide for tradespeople

Figuring out how much to charge per hour when you're running your own trade business is one of those challenges that can feel like a big puzzle. But it doesn't have to be rocket science. The goal is to find a rate that not only matches what others are charging but also covers all your costs and leaves room for some profit too.

(Desired Annual Income ÷ Annual Chargeable Hours) + Business Expenses + Profit Margin = Charge-Out Rate

CLICK HERE TO RECEIVE SERVCRAFT'S FREE CHARGE OUT RATE CALCULATOR

Before you start calculating your charge-out rate:

Figuring out your charge-out rate doesn't have to feel like solving a complex math problem. You don't have to be a numbers whiz to do it right. But it's worth taking a moment to sit down and go over your numbers carefully. The better you understand your costs and income goals, the more precise your charge-out rate will be.

Below are six key considerations for working out your charge-out rate. Before you crunch the numbers with our free charge-out rate calculator, you should be clear on the following points:

Decide how much income you want to make a year

Work out how many hours you can charge for

Add your markup to create your profit margin

Using ServCraft’s Charge-Out Rate Calculator

Why getting your charge out rate right is important


1. Decide how much income you want to make a year

How much cash are you aiming to pocket in a year? Think about what kind of lifestyle you're shooting for and if you're expecting any extra cash from investments. Let's keep it simple for now and say you're aiming for a decent R1,000,000 a year.

2. Work out how many hours you can charge for

Using a typical work week (40 hours a week, 52 weeks a year) to guess how many hours you can bill isn't quite accurate. You need to factor in holidays (both personal and public), sick days, and all the hours you'll spend on things you can't charge for, like administrative tasks.

Here's a tip: Try tracking all the time you spend on tasks that you can't bill for in a week. It's eye-opening! Realistically, you might only be able to charge for around 1,350 hours a year, not the full 2,080 you'd expect from working a 40-hour week for 52 weeks straight.

Once you figure out how many hours you can actually bill for, you can calculate the rate you'll need to cover your expenses and bring in your desired income. So, let's say you're aiming for that R1,000,000 and you've got around 1,350 billable hours in a year. That means you'd have to charge at least R740 per hour to hit your target.

Let's keep things simple and say we're looking at about R400,000 in overheads for the year. Your overheads should cover all sorts of expenses, like tools, rent, and other stuff you need to keep your business running smoothly.

So, if we divide that R400,000 by your 1,350 hours, you're adding an extra R296 to what you need to bring in. That bumps our initial rate of R740/hr up to R1036/hr. But hold on a sec! This is just what you need to break even. If you charge this, you won't be making any profit yet.

6. Add markup to create your profit margin

If you don't have a decent profit margin, there won't be any extra cash to put back into your business. That's why it's important to add on a markup to your charge-out rate. Let's say you add on a reasonable 15%. That means your final charge-out rate would be:

7. Using ServCraft’s Charge-Out Rate Calculator

With those points in mind, you can punch in the numbers using our calculator. It'll do the maths for you and inform your hourly rate. If you've got employees, run the numbers for yourself and each of them (unless they're all getting the same rate).

Once you know what you should be charging, it's time to check if it's realistic and matches up with what others in the market are charging. Keep in mind, you'll want to run this calculation regularly. Industries change, prices go up and down, and your team size might fluctuate.

If you need a hand, your accountant can lend their expertise to help you figure out the final numbers.

8. Why getting your charge out rate right is important

Follow those six key points, and you can plug the numbers into our online calculator. It'll crunch the numbers and tell you what your hourly rate should be. If you've got employees, run the calculation for yourself and each one of them (unless they're all on the same rate).

Once you've got your rate figured out, it's time to check if it makes sense and matches what others are charging in the market. Keep in mind, you should do this regularly because things change — industries evolve, prices fluctuate, and your team size might vary. If you need a hand, your accountant can lend their expertise to help nail down the final numbers.



CLICK HERE TO RECEIVE SERVCRAFT'S FREE CHARGE OUT RATE CALCULATOR


Use our charge out rate calculator to make sure that you are charging what your work is worth

Resource - Charge Out Rate Calculator

Charles Freedman

Dean Cane runs Brightserve Plumbing, a fast growing Plumbing business serving commercial and residential clients with offices in Johannesburg, South Africa.

Dean started his career in hospitality as a restaurant manager in 1995. His cousin was a plumber and used to come to the restaurant to work anything that needed repair and maintenance. Every time he came it looked like he was having the best time wearing shorts and laughing whilst Dean was stuck in the restaurant. When Dean shared he wasn’t loving his job - his cousin replied “come work for me” and that was it!

Dean learnt fast and put together his plumbing and management experience to help grow the business from a team of 4 to a large company he eventually sold in 2008 and exited in 2010. From there he started again, getting a job as an Operations Manager in a large plumbing business where he stayed up to 2018 before being retrenched.

Dean went back to basics and got back in the van after 15-20 years looking to get his hands dirty and find his way. He borrowed some tools, borrowed a van and found his first customer. Brightserve was born. 

At the start of his experience in plumbing things were managed with paper and manual processes. A work order book was the centre of operations where paper job cards were attached to clipboards and handed out to teams for the day. Blue stickers were used to mark if the job had been assigned and when the job was done it would get a yellow sticker. Dean watched this and saw it wasn’t working.

Paper was everywhere. The process was slow and cumbersome. We had to go through four or five people to just get an invoice out. If you’re slow to get invoices out - you’re not getting paid. You wanted to pull your hair out.

In the 90s and at the time there was nothing off the shelf to solve their problem. So they built a solution for hundreds of thousands of Rands. Life changed - and Dean saw the power of technology on his business.

When Dean started Brightserve he did some research and went with an Australian job management software. Unfortunately they only worked on Apple devices and he found many things on the system weren’t familiar or relevant to South Africa. On top of that he wasn’t able to have a direct line to a local support team he could talk to in real time to solve his problems.

Dean was introduced to ServCraft and was surprised to have not heard about it before. ServCraft was able to offer him all the the things he’d been using on the Aussie software - but at a much lower price and supported by a local team who really got the local challenges he was having to overcome on a daily basis.

ServCraft worked with Dean and his team to design the job card and ServCraft that worked for him and his business. ServCraft listened deeply to Deans suggestions and used them to build features that all ServCraft plumbing customers could benefit from.

ServCraft’s people and their passion to help him with the change made a big difference to the impact ServCraft was able to make.

Dean's journey as a plumbing entrepreneur and the game-changing software that transformed his Business

Case Study: Brightserve Plumbing

TJ Botten runs ENERGEY, a solar solutions business with a focus on commercial and industrial solutions alongside domestic, retail and information solutions. ENERGY is a fast growing solar business with offices in Johannesburg and Cape Town.

TJ was working for a technology company before he spun out his own business based on his interests in solar and renewable energy and IOT (internet of things). In 2019 he started Power Dot Data and in 2022 he started ENERGEY.

In the beginning operations were chaotic. TJ didn’t know what systems and processes we needed to optimise his ways of work - especially how he managed billing. Everything was paper and email - except for the accounting software.

As the teams grew he was dropping the ball constantly. He never knew which client needed to be followed up with. Jumbled emails and WhatsApps were impossible to keep up with. Nothing connected ENERGEY with their clients and suppliers.

Opportunities were lost. Billing was missed. It was painful and expensive. He was losing thousands of Rands a month that could have been avoided.

TJ needed a job management software to join everything together - at a reasonable price of course.

TJ started looking around for job management software - initially looking at a wide range of international job management software providers. They all had bits and pieces of what he needed but couldn’t find anything that fit the South African space. By chance he was doing a solar job when someone in the house suggested he looked at ServCraft’s job management software.

ServCraft's local South African team reached out and showed him a demo that ticked all his boxes for managing a solar installation business.

TJ loved the fact that the local team understood what it was like running a solar business in South Africa - and were so committed to helping improve his operation.

ServCraft’s integration with Xero was also a big plus. Now TJ could integrate his financial management and operations management powering productivity and saving time.

ServCraft worked with TJ and his team to design the job card and ServCraft that worked for him and his business. ServCraft’s people and passion to help him with the change made a big difference to the impact ServCraft was able to make.

TJ and his team were contacted by a ServCraft expert who took the time to understand the specific problems and processes in the solar installation business - as well as the experience TJ wanted his customers to have.

From there they sat together and designed a ServCraft that worked for them. There wasn’t too much adaptation needed.

It didn’t stop there. ServCraft’s Implementation Coach collaborated with ENERGEY’s team to design, plan and implement ServCraft across the business. This involved training the teams, testing the processes, and making sure they got the results they needed. TJ chose a date and went live.

ServCraft’s local team is in touch regularly with TJ - responding to questions, sharing how new features could help and providing training to TJ’s growing team.
The results

TJ felt the impact of ServCraft’s job man as soon as he switched it on across ENERGEY.

Invoicing straight from ServCraft means that things only need to be captured in one system - saving TJ huge amounts of time and making sure that things don’t get dropped between systems.

The biggest thing for TJ is scheduling. Planning and managing what his teams are doing from one place is powerful and gives him complete control of his operations so he can manage risks before they turn into issues.

TJ’s customers love the notifications. Emails, SMS giving customers a view of the jobs cards and pictures make it real for his customers and really add value. Now TJs know what his customers think after every job with ServCraft’s feedback function.

TJ isn’t losing money any more. ServCraft makes sure nothing falls through the cracks.

TJ runs ENERGEY, a solar solutions business with a focus on commercial and industrial solutions alongside domestic, retail and information solutions. Learn how TJ Transformed his Solar Business with ServCraft's Tailored job management solution.

Case Study: Energey


Ricky Solomon runs Pool Squad - one of the leading pool development, maintenance and repair companies in Gauteng, South Africa, managing pools across commercial and residential properties.

As the business grew, it became harder to manage their paperwork and teams. Jobs slipped through the cracks and customers weren’t getting the experience they signed up for. Ricky was spending his time running around after information and redoing work - rather than thinking about growing the business.

It was a customer who nudged Ricky to look at technology. He realised that without it, he’d never be able to grow Pool Squad. After dipping his toe with an international job management software, he was introduced to ServCraft, a job card management system, and never looked back.

ServCraft has transformed his operations, saving him time and money, alongside giving his customers a slick and professional experience. Now he’s able to grow with complete control, higher productivity, and with nothing falling through the cracks.

It was easy enough when he started. A5 branded job cards were handed out to technicians who scribbled on them during the day and handed them in the next day for quoting and invoicing. A whiteboard was used to document the issues and manage the teams on the road.

As business picked up, it became clear there was a problem. Lost cards, bad handwriting, delayed quotes and invoices. The whiteboard quickly became too small and changed so often that not enough information was available for the office or the teams to understand and solve problems for customers.

Things began falling through the cracks. Lost job cards. Delayed quotes and invoices. Customers complaining about work that was or wasn’t done. All whilst the team worked even harder to stay on top of things. Something needed to change.

Ricky was introduced to ServCraft a few months after using an international job management software. He wasn’t getting what he needed from the job management software he was using.

The local South African team showed him a demo that ticked all his boxes for managing a pool repair and maintenance business he was in.

Ricky loved the fact that the local team understood what it was like running a pool maintenance and repair business in South Africa - and were so committed to helping improve his operation.

ServCraft’s integration with Xero was also a big plus. Now Ricky could integrate his financial management and operation management powering productivity and saving time.

ServCraft worked with Ricky and his team to design the job card and ServCraft that worked for him and his business. ServCraft’s people and passion to help him with the change made a big difference to the impact ServCraft was able to make.

Ricky and his team were contacted by a ServCraft expert who took the time to understand the specific problems and processes in the pool repair and maintenance business - as well as the experience Ricky wanted his customers to have.

From there they sat together and designed a ServCraft that worked for them.

It didn’t stop there. ServCraft’s Implementation Coach collaborated with Pool Squad’s team to design, plan and implement Pool Squad across the business. This involved training the teams, testing the processes, and making sure they got the results they needed. Ricky chose a date and went live.

ServCraft’s local team is in touch regularly with Ricky and the Pool Squad - responding to questions, sharing how new features could help and providing training to Ricky’s growing team.
The results

ServCraft’s job card management system has changed how Ricky and his team spends time on his pool repair and maintenance business.

Instead of fighting fires and looking for information in the business Ricky gets to work on the business using the information at his fingertips to make better decisions faster and focus on growing the business even more.

It's a great view of the business because of the dashboard. I could see exactly how many jobs we've got booked. I can see exactly how many jobs we did that day. I use the filters, in terms of maintenance or repairs, across the different divisions that we have in our business. ~ 

Ricky and the team are in control of their jobs from the moment the customer reaches out to the moment they pay. ServCraft’s job management software means nothing falls through the cracks. Leads. Quotes. Jobs. Invoices. Everything is managed tightly with less time and effort than it was previously.

More productivity means that Ricky and his team can do more with less thanks to ServCraft’s job management software. Teams can get to more jobs and the office can focus on solving customer problems, winning work and getting paid.

The customer experience has also been transformed. Now customers get a detailed report with pictures and readings of the job as soon as it’s closed.

No more question marks about what Pool Squad did whilst the customer wasn’t there.

Quotes and invoices pop into customer emails almost as they close the door to the team to make a cup of tea.

Ricky is winning maintenance work from repair customers who are impressed with the experience they have.

Discover how Ricky Solomon, owner of Pool Squad, overcame the challenges of managing a growing pool development company. Learn how ServCraft's job card management system helped Ricky save time, increase productivity, and deliver a superior customer experience. 

Case Study:  Pool Squad

Pam Kruger runs ACCM, an HVAC (Heating, Ventilation, and Air Conditioning) business serving commercial and residential across Gauteng. ACCM is a fast growing HVAC business with offices in Pretoria, South Africa.

Pam started her HVAC career at 18 as a receptionist and quickly rose through the ranks to office manager. When the owner retired she got together with Shaun Botha to branch out on their own. Working from an office in her garden they grew their business to 16 people and run a thriving business providing HVAC (Heating, Ventilation, and Air Conditioning) services to leading brands - alongside people in their homes.

In the beginning operations were chaotic. An excel job book captured and managed all the jobs. Manually managing multiple tabs, complex drop downs and duplicated fields was labour intensive - and full of the risk of missing something. Pam was re-typing information across job capture, job cards and invoices. Every day was a run around trying to put the pieces of the puzzle together to work out what was going on and how to keep momentum going.

As the business grew and Pam delegated the role to an administrator she lost control of the process and had to trust someone else would give the same level of scrutiny to the systems she’d set up. She realised that if things were falling through the cracks with her in control - the risk of things falling through the cracks was even greater now she didn’t have control.

Pam reflects on the time it took to try and stay in control of the information and manage the manual and paper systems she’d built. It all took time. Time she and the team could have been spending on keeping up with the demand her business was attracting.

Pam knew that as technology enabled her customers to tap into her competitors faster - she needed to find a way to get quality quotes out faster to win more work.

Pam needed a job card management system to put her in control and save time so she could work more on the business - and not in the business.

Pam first thought about digitising her job cards with job card management system from a Facebook advert. She started looking around for job management software - initially looking at a wide range of job management software providers. After trying something else that didn’t work out as promised - she came across ServCraft.

ServCraft’s local South African team reached out and showed her a demo that ticked all her boxes for managing an HVAC (Heating, Ventilation, and Air Conditioning) business.

Pam loved the fact that the local team understood what it was like running a HVAC (Heating, Ventilation, and Air Conditioning) business in South Africa - and were so committed to helping improve her HVAC (Heating, Ventilation, and Air Conditioning) operation.

ServCraft worked with Pam and her team to design the job card and ServCraft that worked for her and her business. ServCraft listened deeply to Pam’s suggestions and used them to build features that all ServCraft HVAC (Heating, Ventilation, and Air Conditioning) customers could benefit from.

ServCraft’s people and their passion to help her with the change made a big difference to the impact ServCraft was able to make.

Pam and her team were contacted by a ServCraft expert who took the time to understand the specific problems and processes in the HVAC (Heating, Ventilation, and Air Conditioning) installation business - as well as the experience Pam wanted her customers to have.

It didn’t stop there. ServCraft’s Implementation Coach collaborated with ACCM’s team to design, plan and implement ServCraft across the business. This involved training the teams, testing the processes, and making sure they got the results they needed. Pam chose a date and went live.

ServCraft’s local team is in touch regularly with Pam - taking on new ideas, responding to questions, sharing how new features could help and providing training to Pam’s growing team.

Pam felt the impact of ServCraft’s job card management system as soon as she switched it on across ACCM.

Pam now has all the information she needs to run the business at her fingertips - whilst having complete control and visibility of the day to day operations. Instead of looking for files manually it’s all there - and accessible with the click of a button.

ServCraft’s scheduling feature and jobs list has transformed her control of her teams. Planning and managing what her teams are doing from one place is powerful and gives her complete control of her operations so she can optimise routes and manage risks before they turn into issues. The team is so much more productive with ServCraft.

Customers love signing off on the tablet and getting job cards and reports with details of the work that was done. It really helps us show them the value we add - and gives us a wow experience. The automatic feedback function helps us stay on top of what customers really experience - so we can celebrate success or manage issues.

Now Pam wins work faster - and gets paid faster. Quotes and invoices go out as soon as the job is signed off on ServCraft - she doesn't have to wait for the job card to come back to the office. Pam uses ServCraft to manage regular follow ups on quotes and invoices as well as automating follow ups on service and maintenance work after an installation. Customers now get a proactive service (that generates revenue for ACCM) vs the unit breaking down because it wasn’t maintained properly.

ServCraft is helping ACCM grow from strength to strength.

Learn how ACCM, an HVAC business in South Africa, overcame the challenges of manual and paper-based systems with the help of ServCraft's job management software.

Case Study: ACCM

Sheldon Pawson runs Active Motion, a security solutions and installation business serving commercial and residential properties nationwide. Active Motion is a fast growing security installation business with offices in Johannesburg.

Sheldon started Active Motion with no car, no staff and no capital. Grit and resilience helped him win his first customer who took a chance on him. Today he employees 52 staff, manages 12 teams and serves over 3000 clients.

In the beginning operations were chaotic. Sheldon didn’t know what systems and processes he needed to grow - especially how he managed billing. Carbon copy job cards, paper, email, spreadsheets, word documents, whiteboards. Every morning was a run around trying to put the pieces of the puzzle together to work out what was going on and how to keep momentum going.

All of this took time. Time the team could have been spending on keeping up with the demand his business was attracting. Sheldon knew that as technology enabled his customers to tap into his competitors faster - he needed to find a way to get quality quotes out faster to win more work.

When a customer called he’d run to the file room to try and find a file which ofter wasn’t there - turning a five minute query into a two hour team effort.

In this time balls got dropped. Jumbled papers, emails and WhatsApps were impossible to keep up with. Job cards got lost and left on site. Information wasn’t correctly captured and jobs weren’t signed for. Nothing connected the different parts across Active Motion with their clients and suppliers.

Sheldon needed a job management software to join everything together.

Sheldon started looking around for job management software - initially looking at a wide range of international job management software providers. They all had bits and pieces of what he needed but couldn’t find anything that fit the South African security installation space. Unit he met ServCraft.

ServCraft’s local South African team reached out and showed him a demo that ticked all his boxes for managing a security installation business.

Sheldon loved the fact that the local team understood what it was like running a security business in South Africa - and were so committed to helping improve his security installation operation.

ServCraft worked with Sheldon and his team to design the job card and ServCraft that worked for him and his business. ServCraft listened deeply to Sheldon’s suggestions and used them to build features that all ServCraft customers could benefit from.

Sheldon and his team were contacted by a ServCraft expert who took the time to understand the specific problems and processes in the security installation business - as well as the experience Sheldon wanted his customers to have.

It didn’t stop there. ServCraft’s Implementation Coach collaborated with Active Motion’s team to design, plan and implement ServCraft across the business. This involved training the teams, testing the processes, and making sure they got the results they needed. Sheldon chose a date and went live.

ServCraft’s local team is in touch regularly with Sheldon - taking on new ideas, responding to questions, sharing how new features could help and providing training to Sheldon’s growing team.

Sheldon felt the impact of ServCraft’s job man as soon as he switched it on across Active Motion.

ServCraft’s scheduling feature and jobs list has transformed his control of his teams. Planning and managing what his teams are doing from one place is powerful and gives him complete control of his operations so he can manage risks before they turn into issues.

So now I've got all that information at my fingertips...I'm well prepared for that phone call. At any given time, we look very professional because we've got all the facts in front of us. ~ 

In security installation trust is everything. Emails, SMS giving customers a view of the jobs cards and pictures make it real for his customers and really add value. ServCraft helps his customers trust him even more by delivering a highly professional experience and keeping them in the loop across the job.

ServCraft is helping Active Motion grow from strength to strength.

See how ServCraft's job management system helped Sheldon grow his security installation business from selling out the back of his car to employing 52 staff serving over 3000 clients.