23 Feb Why Some Vendors Separate Parts from Labor on an Invoice
Whether it’s for routine residential maintenance, big commercial jobs, or any other type of project, receiving a detailed vendor invoice is the norm.
On that invoice, you can expect to get a breakdown of the total costs and services rendered associated with a particular project. However, it is now commonplace for most vendors to separate the fees for parts from labor and many wonder why?
Well, as a professional handyman company that does in fact do this, we’d like to hopefully answer this for those of you out there that might be tackling their own improvement projects.
Separating Parts from Labor
There are several reasons why a vendor will separate parts from labor on an invoice but the major reason is for transparency.
Due to the many dishonest vendors out there, some homeowners have become skeptical, feeling as though they’re being ripped off. So separating the parts from labor on a maintenance invoice provides a more detailed breakdown and explanation of the costs – leaving little room for questions from the client.
As expected, our clients always appreciate having an invoice broken down in this way. It shows them exactly what they are paying for, especially when pertaining to jobs where materials on their own far surpass the cost of the labor to install it.
For example, fencing materials have gone up in price substantially in recent years. You will typically spend 3-5 times more on the materials than the labor, depending on the project. Without that explanation broken down on an invoice, some may think they were being taken advantage of.
According to Matthew Meade, GARSC Operations Manager, “We do our best to show clients what they will be spending for each aspect of the project so they can trust that we are providing them with an accurate portrayal of the costs to complete the tasks assigned. Having that breakdown gives the clients more insight to what all is involved as well as understanding the various costs to get it done right the first time.”
Invoice For Total Materials Vs Per Item Used
You might be wondering if there is any benefit to listing costs for materials as one total lump sum versus per item used on a vendor invoice? Honestly, what it comes down to is the time involved notating every single item used. From a client perspective, there isn’t a huge advantage in your service provider doing so.
At GARSC, clients do not get an invoice listing every item and tool used to complete a job, but rather costs for total materials. However, we do keep track of the materials purchased versus those we use from our own toolbox.
Additionally, invoicing in that manner allows us to more seamlessly track finances for our company records as well as cut down on the time spent creating invoices – limiting labor costs to be more efficient when completing jobs.
We also do mark-up materials used overall. We have to function and make money as a business on the work we provide afterall. So if we were to price it out by individual item, it would increase the total dollar amount we charge, which would definitely not be in the client’s best interest.
The Bottom Line
While there are other things to note before approving a contractor estimate, transparency of the contractor is crucial when deciding to work with them for the first time or the 50th time. We always encourage you to research reviews to be sure the decision you’re making is the right one.
Contact GARSC today, to tackle all of your Austin residential and commercial maintenance needs and get the job done right the first time. With years of consistency and transparency managing projects for our clients, know that we have you covered.
We look forward to partnering with you!
By: Kayla Gonzales, GARSC Marketing Manager