How to price a maintenance agreement

Most maintenance plans are priced by looking at what the shop down the road charges and taking a few dollars off. That works until you run the numbers at the end of the year and find the plan lost money, or that half the members never renewed.

This guide goes deeper than our overview of maintenance memberships, which covers what to include and how to sell a plan. Here we focus on the math: what a member visit really costs, how much discount you can afford, whether to bill monthly or yearly, and how to set up renewals so the plan keeps paying.

All figures below are examples to show the method. Use your own costs, rates and local market.

Key takeaways

Price from your fully loaded cost per visit, not from a competitor's price.
Treat the member discount as a cost and estimate it from your repair history.
Priority service costs little to offer but is one of the perks members value most.
Monthly billing is easier to sell; yearly billing collects cash up front. Many shops offer both.
Decide how you'll handle price increases before launch, and review the plan every year.

How much should a maintenance agreement cost?

A maintenance agreement should cost enough to cover the fully loaded cost of the included visits, the expected cost of the member discount and your target margin, while still coming in below what the visits would cost the customer one by one. For many shops that lands the plan at roughly the price of the included visits, minus a visible saving.

That last part matters. If the plan doesn't look like a better deal than paying per visit, few people sign up. If it's priced below cost, every new member makes the hole deeper. The steps below find the range between those two lines.

Step 1: find your true cost per visit

Your cost per maintenance visit is more than the technician's hourly wage. Add up everything the visit consumes.

Labor, loaded. Take the tech's hourly pay and add payroll taxes, workers' comp, benefits and paid time off. Many owners find this adds a meaningful share on top of the wage. Use your own payroll numbers.

Time on the job and on the road. A tune-up might be 60 to 75 minutes on site, plus drive time between jobs. Count both.

Materials. Filters, cleaning supplies, small parts you include in the visit.

Vehicle. Fuel and a per-mile or per-hour share of the truck's cost.

Overhead share. Office time to schedule the visit, software, insurance, the shop. A common method is to divide your yearly overhead by the billable hours your techs work in a year, and add that rate to each hour of a visit.

Worked example: cost per visit

Example only, for an HVAC tune-up.

Item	Example figure
Loaded labor rate	$42/hour
Time per visit (on site plus drive)	1.5 hours
Labor cost	$63
Materials (standard filter, supplies)	$12
Vehicle	$8
Overhead share ($25/hour × 1.5 hours)	$37.50
Fully loaded cost per visit	$120.50

Two visits a year cost this example shop about $241. That's already higher than many owners guess, and it's why plans priced from a competitor's flyer often lose money.

Why scheduled visits can cost less

Member visits can be cheaper to deliver than one-off calls, because you schedule them. Put them in your slow weeks, group them by neighborhood to cut drive time, and they fill hours you'd otherwise pay for anyway. If a tech would otherwise be idle, the real extra cost of that visit is closer to materials and fuel. Don't price the plan as if every visit were free, but this is the reason memberships work best when you control the calendar.

Step 2: put a number on the member discount

The member discount is a real cost, so estimate it from your own records. Look at what customers like your future members spent on repairs last year.

Example: your repair customers spend an average of $450 a year on repairs. You plan a 15% member discount.

Expected discount cost per member: $450 × 15% = $67.50 a year.

Two things shift this number:

Members tend to call you for repairs instead of shopping around. That's the point of the plan, so expect member repair spend to be somewhat higher than average, and the discount cost with it.
Discounts on parts cost more than discounts on labor when your parts margin is thin. Many shops give a larger discount on labor than on parts, for example 15% off services and 10% off materials.

How big a discount can you afford?

Run the math at a few levels. Example, $450 average repair spend:

Discount	Cost per member per year
10%	$45
15%	$67.50
20%	$90

Then check it against your gross margin on repairs. If your repair margin is 50%, a 20% discount gives away 40% of your profit on that work. Most shops find a modest discount is enough to keep members loyal.

Step 3: what is priority service worth?

Priority service means members get the earlier slot when your phones are ringing on the first hot day. It costs you almost nothing in normal weeks and some juggling in busy weeks. For the customer, not waiting three days without air conditioning is one of the most valuable things in the plan.

You don't need to price priority as a separate line. Treat it as a reason the plan is worth more than the sum of its visits, and make it visible: members should be flagged on your dispatch board so every dispatcher honors it. One caution: if more than a modest share of your customers become members, "priority" stops meaning much. That's a good problem, and a sign to add techs.

Step 4: add your margin and check the customer's side

Now put it together. Example, continued:

Line	Per year
Two visits at fully loaded cost	$241
Expected member discount (15%)	$67.50
Total cost per member	$308.50

That looks expensive. But remember the visits fill slow weeks, so part of that labor and overhead you'd pay anyway. Here's the other side.

The customer's view. If your regular tune-up price is $159, two visits are $318 at full price. A plan at $264 a year ($22 a month) saves the customer $54 on visits alone, before any repair discount and before priority service.

Your view. At $264 a year, the plan covers the visits' direct costs (labor, materials and vehicle: $166 for two) and much of the overhead share, and it brings in the repair work and replacement opportunities that members steer your way. Whether that's enough margin is your call, and it depends on how many member visits truly land in otherwise idle time.

If the plan only works when every member buys a big repair, it's priced too low. If it costs more than paying per visit, it's priced too high to sell.

Should a maintenance plan bill monthly or yearly?

Offer monthly billing if you want more sign-ups, and yearly billing if you want cash up front and fewer payments to process. Many shops offer both, with a small saving on the yearly price. Either way, collect a card at signup and charge it automatically.

Monthly billing

Easier to say yes to. $22 a month feels smaller than $264 a year.
Steadier cash flow through the year.
More payments. Twelve charges a year means more chances for a card to decline or expire. You need a way to follow up on failed charges.
Fixed per-transaction fees add up more on many small charges than on one big one. Check your processor's pricing.

Yearly billing

Cash up front, useful before a slow season.
One decision a year. That's the risk too: each renewal is a moment the customer reconsiders.
Offer a reason to choose it, such as one month free ($242 instead of $264).

Don't skip autopay

Without autopay, every billing date becomes an invoice someone has to chase. Get clear consent to charge the card on a schedule, tell the customer exactly how much and how often, and send a receipt every time.

Renewals and price increases

A plan priced right today will be wrong in three years if your costs rise. Plan for it now.

Review once a year. Re-run steps 1 to 4 with current wages, fuel and parts costs.
Decide your policy for existing members before launch. Some shops keep members at their signup price as a loyalty perk; others apply increases at renewal with notice. Either is fine; switching later is awkward.
Give notice before renewal. A short message a few weeks before, with what the member got this year, avoids surprise charges and chargebacks.
Auto-renew by default, with easy canceling. Members who know they can leave easily are more comfortable staying.

Track renewal rate

Count how many members whose term ended this month renewed. If renewals drop, the most common reason is visits that never happened. Before you change the price, check that every member got the visits they paid for.

Adapting the math for plumbing plans

Plumbing plans use the same method with different visits. A typical plumbing plan includes one yearly inspection: water heater flush and check, fixture and shutoff valve check, a look at visible supply and drain lines, and a pressure test. The visit is often shorter than an HVAC tune-up, so the cost per member is lower, and the repair discount does more of the work in making the plan attractive.

Two things to watch:

Estimate the discount from the jobs members will actually call you for. Look at your own history for the job types that come up most among homeowners like your members, such as drain cleaning or no-hot-water calls, rather than your overall average.
Waived trip or diagnostic fees are an easy, valuable perk for plumbing members. Count them as a cost the same way as the discount: number of expected calls × the fee you waive.

A quick pricing worksheet

Fully loaded cost per visit × visits per year.
Average yearly repair spend × member discount.
Add 1 and 2 for your cost per member.
Regular price of the included visits: the customer's comparison point.
Set the plan price between your cost (adjusted for visits that fill idle time) and the customer's comparison point.
Divide by 12 for a monthly price, and round to a clean number.

How ServFlo handles the plan once it's priced

On the Grow plan and above, ServFlo's memberships run the plan for you. You set the price and billing (monthly, quarterly, yearly and other periods), the term, the included visits (for example April and October), the discount on services and on materials separately, and whether members get priority. ServFlo bills each period, charges members with autopay, creates each included visit on your Needs scheduling list as it comes due, adds the member discounts to quotes and invoices as visible lines, and flags members with Priority on the dispatch board.

Plan changes apply to new members: each membership keeps the price and perks it was sold with through every renewal, which matters for the price-increase policy above. Reports → Memberships shows members, monthly recurring revenue, sign-ups, churn and renewals due, so you can check your math against reality each year.

Get the numbers right once, and a good maintenance plan becomes the steadiest revenue in your business. If you'd like to see the setup with your own plan, ServFlo's 14-day trial includes memberships.

Maintenance agreement pricing: the math behind HVAC and plumbing plans