One reason contractors are hesitant to offer service agreements is that they believe they are a risky proposition. That’s true, says Steve Howard, president of A.C.T., Phoenix, AZ, if you don’t know how to price them.
There are no hard-and-fast rules to pricing service agreements, but Howard believes that the agreement should at least cover costs. “The correct answer on how to price a service agreement is; there isn’t really a correct answer. It goes back to what are the goals and motives of the company.”