Plumbing shops lose money on pricing in two opposite ways. Small calls get underpriced because a faucet cartridge "shouldn't cost that much," even though reaching the house costs the same as reaching a water heater job. And big jobs get underpriced because the estimate forgot the permit, the expansion tank, the haul-away or the extra hour that every old house adds.
This guide walks through how to build plumbing prices from your own costs: what a plumber really costs per billable hour, how to recover overhead, markup versus margin, flat-rate tasks, diagnostic and after-hours fees, water heaters, drain and sewer work, and member pricing. Every number below is a hypothetical example. Plug in your own.
Flat rate vs time and materials in plumbing
Time and materials bills hours worked plus parts. It's transparent, but in residential service the customer can't approve a price up front, slow work earns more than fast work, and two plumbers on the same repair produce two different invoices.
Flat rate prices each task as a fixed amount set in advance from an average time, materials, overhead and profit. The customer approves the price before you start, and every plumber quotes the same job the same way. That's why it's the norm in residential service plumbing.
T&M still fits:
- Remodel rough-ins and repipes where scope evolves, with written terms.
- Commercial service contracts with agreed rates.
- Hunting an intermittent problem across a large building.
Either way, the foundation is the same: knowing what one billable hour costs you.
Step 1: Find the true cost of a plumber's labor
Start with wages and add everything that comes with them.
Wages. Base pay times paid hours, plus expected overtime and on-call pay. For context, the median pay for plumbers, pipefitters and steamfitters was $30.67 an hour in May 2025, per the Bureau of Labor Statistics. Your market and your plumbers' experience will differ, so use your own payroll.
Payroll taxes. The employer share of Social Security and Medicare is 7.65% of wages up to the Social Security wage base, plus federal and state unemployment taxes. IRS Publication 15 has the rules; your payroll provider has your rates.
Insurance and benefits. Workers' comp (often significant in plumbing), health insurance, retirement match, paid time off. The BLS Employer Costs for Employee Compensation series shows how large benefits are relative to wages across industries, but your own numbers are what count.
Other per-plumber costs. Training, license renewals and continuing education, uniforms, phones, tools you supply. Some shops count the truck here, others in overhead. Count it once.
Example (hypothetical): a plumber earns $34 an hour for 2,080 paid hours, or $70,720. Taxes, workers' comp, benefits and training add 32%, or $22,630. Loaded labor cost: $93,350 a year.
Step 2: Count billable hours, not paid hours
Subtract from 2,080 paid hours:
- Holidays, vacation and sick time.
- Training and meetings.
- Supply house runs and truck restocking. These are bigger in plumbing than most trades.
- Drive time between calls.
- Callbacks and warranty work.
- Calls where only the diagnostic was paid.
What's left is time on site doing invoiced work. Many shops find it's well under 60% of paid hours. Pull a month of time entries and compare them with invoiced jobs to get your real number.
Example (hypothetical): of 2,080 paid hours, this plumber bills 1,150. Labor cost per billable hour: $93,350 ÷ 1,150 = $81.17.
Step 3: Recover overhead on every billable hour
Overhead is what you spend to keep the doors open that isn't tied to a specific plumber or part: office staff, rent, trucks and fuel (if not in labor), insurance, software, phones, answering service, marketing, accounting, equipment like jetters and cameras, loan payments, and the owner's salary if the owner doesn't bill.
Overhead per billable hour = annual overhead ÷ total team billable hours
Example (hypothetical): a 5-plumber shop with $480,000 of overhead. Each plumber bills 1,150 hours, so 5,750 in total. Overhead per billable hour: $480,000 ÷ 5,750 = $83.48.
Break-even cost per billable hour: $81.17 + $83.48 = $164.65.
Every hour sold below that loses money before you've paid for a single fitting. The labor rate calculator runs this with your numbers.
Step 4: Markup vs margin, and adding profit
"50%" means different things depending on whether you mean markup or margin.
Markup = (Price − Cost) ÷ Cost
Margin = (Price − Cost) ÷ Price
To price from a target margin: Price = Cost ÷ (1 − Margin)
To price from a target markup: Price = Cost × (1 + Markup)
Example: a valve costs $40. A 50% markup sells it for $60, which is only a 33% margin. A 50% margin sells it for $80, a 100% markup.
If your profit targets are margins (most P&Ls are) and your price book applies markups, you'll come up short on every ticket. The markup and margin calculator converts both ways.
Labor rate with profit (hypothetical): for a 15% net margin on labor, $164.65 ÷ 0.85 = $193.71 per billable hour.
Step 5: Build flat-rate tasks
Task price = (task hours × hourly selling rate) + material price
Task hours are realistic times for an average plumber, including setup, testing and cleanup. Material price is your cost marked up to your materials margin target.
Example (hypothetical): replace a toilet fill valve and flapper.
- Time: 0.75 hours × $193.71 = $145.28.
- Parts cost $22. At a 60% materials margin: $22 ÷ 0.4 = $55.
- Task price: $200.28. Round to $200.
Build the 30 to 50 tasks that make up most of your tickets first: fill valves, faucet cartridges, supply lines, angle stops, wax rings and toilet resets, disposals, hose bibbs, PRVs, drain clearing by type, water heater repairs. Add tasks as plumbers ask for them.
Rules that keep a plumbing price book healthy:
- Use average-plumber times, not your best plumber's.
- Build in access difficulty. A second-floor bathroom over a finished ceiling isn't the same job as a basement. Use add-on tasks for access, crawlspaces and old galvanized or cast iron.
- Separate materials from labor in your build sheet so supplier price changes don't mean rebuilding labor.
- Bundle obvious combinations, such as fill valve plus flapper plus supply line.
- Write descriptions customers understand. "Replace leaking shutoff valve under kitchen sink and test" beats "ANG STP RPL."
The flat-rate price book builder gives you a spreadsheet layout for this.
Diagnostic, trip and after-hours fees
Diagnostic or trip fee. Covers the trip and the diagnosis. Decide in writing:
- What it covers: the trip and diagnosis, sometimes a set amount of camera time.
- Whether it's credited toward approved work. Crediting can help close rates; not crediting protects margin on declined calls.
- When it's quoted: at booking, every time.
At minimum, it should cover average drive time plus diagnosis time at break-even. Example (hypothetical): 0.5 hours of drive and 0.5 hours of diagnosis at $164.65 is $164.65 just to break even.
After-hours fee. Nights, weekends and holidays cost more: on-call pay, overtime and next-day schedule disruption. Use a published fee or a multiplier on your task prices, quote it before dispatch, and track after-hours revenue separately. If it doesn't cover the on-call rotation, change the fee or the rotation.
Water heaters: price the whole package
Water heater replacements are one of plumbing's most common big tickets, and they're easy to underprice by leaving things out. Price each option as a complete package:
- The unit.
- Fittings, connectors, valves and venting.
- Code-required items in your jurisdiction, such as expansion tanks, pans, seismic strapping or venting changes.
- Permit and inspection time.
- Labor for the crew, including carrying, draining and disposal.
- Haul-away.
Then apply your target margin to the total: price = total cost ÷ (1 − margin).
Offer options instead of one price: a like-for-like tank, an upgraded tank with a longer warranty, and tankless or a heat pump water heater. Our post on good-better-best estimates explains why options tend to close more work. TradesWork builds good-better-best options from your own price book and shows a monthly payment on each, so every plumber presents them the same way.
Drain and sewer: separate diagnosis from repair
Drain work has a built-in uncertainty: you can't see what's down there until you look.
- Drain clearing prices by access and type: sink, tub, toilet, main line from cleanout, main line by pulling a toilet or through the roof. Each gets its own task.
- Camera inspection is its own price, offered on recurring stoppages and main lines. It turns "what's down there" arguments into options.
- Sewer repair or replacement is quoted after diagnosis, priced per foot or by section from your own production history, plus excavation, restoration, permits and locates.
Keep diagnosis and repair separate on the estimate so the customer sees what the camera found before approving excavation. It builds trust and protects you if the scope changes.
Member pricing
A plumbing maintenance plan often includes a repair discount. That discount comes out of margin you've already built, so check it on your highest-volume tasks.
Example (hypothetical): the $200 fill valve task with a 15% member discount is $170.
- Cost: (0.75 × $164.65 break-even) + $22 part = $145.49.
- Member margin: ($170 − $145.49) ÷ $170 = 14.4%.
Still profitable, but thin. Common fixes: limit the discount to repairs rather than water heaters and sewer work, or set the standard price so the member price is the one you designed for. In TradesWork, member pricing applies to the estimate automatically, so plumbers don't have to remember and customers see the savings.
Keeping prices current
- Parts: update when suppliers change prices. Copper and water heater prices move.
- Labor: review at least yearly, and when wages, workers' comp or benefits change.
- Overhead: recompute when you add a truck, an office hire or a jetter.
- Task times: compare estimated and actual times quarterly.
Watch gross margin by job type, average ticket and close rate monthly. If margin slides while close rate climbs, prices may be too low. If close rate falls after a price change, look at how options are presented before cutting prices. TradesWork shows what each job really made, with the jobs behind each number, so underpriced tasks stand out.
A plumbing pricing checklist
- Loaded labor cost per plumber from real payroll.
- Billable hours measured from real time entries.
- Annual overhead totaled, including owner pay, equipment and vehicle replacement.
- Break-even cost per billable hour known.
- Profit target set as a margin, with prices built using the margin formula.
- Top 30 to 50 tasks priced flat rate, with access add-ons.
- Diagnostic fee and after-hours fee set, written down and quoted at booking.
- Water heater packages built with every code item, permit and haul-away.
- Drain clearing, camera and sewer repair priced separately.
- Member discount checked against cost.
- Review dates on the calendar for parts, labor and overhead.
