In Today’s Newsletter

• Reasons you should NOT buy a business

• Things you should do…

• Building your Pricebook in ServiceTitan

• Why banks have extended over $50M in credit to us

• Managing capacity across 20+ business units

• What I like (and don’t) about 0% financing

• Favorite Tweets from the past week

Technology Corner with ServiceTitan

Building a Flat-Rate Pricebook in ServiceTitan

One of the most important tools in any best-in-class service company is a flat-rate pricebook.

Why? Because without it, you’re flying blind.

When you sell work using time & material or custom options every time, you lose visibility into the economics of your business at the task level. And that’s where the gold is:

• Gross margin per task

• Average time to complete per task

• Material cost per task

With flat-rate pricing, these numbers become clear. And when they’re clear—you can measure, improve, and scale.

The Building Blocks of Flat-Rate Pricing

When we configure pricing inside ServiceTitan, we build each task with three primary inputs:

• Estimated hours to complete (in as little as 5-minute increments)

• Perceived value in the customer’s eyes (low, moderate, or high)

• Rate per billable hour (a number that reflects:

  • our cost structure

  • overhead

  • the perceived value category (1-3)

  • and our billable hour efficiency—i.e., how many hours in a day we are actually billing to customers)

Together, these inputs create pricing that is fair, consistent, and measurable.

Tips for Building a Strong Pricebook

1. Use the average—not the expert.

   • Base estimated hours on the average time it takes your team, not your most skilled field pro.

   • If you build pricing around the fastest person, your margins will evaporate.

2. Condense task codes.

   • A 3,000-task code pricebook becomes unmanageable.

   • Simplify and combine similar tasks so your team can build options quickly in the field.

3. Make it searchable.

   • Task code names should be intuitive and easy to find.

   • Think about how a field pro will search in the heat of the moment.

4. Tag materials automatically.

   • Link materials directly to tasks to save time, reduce option-building friction, and streamline replenishment.

5. Never stop improving.

   • Monitor the performance of task codes.

   • Ensure consistent application by your team.

   • Track material usage vs. expectations.

   • Minimize “generic” tasks or “custom options.”

6. Be intentional with discounts.

   • When customers choose multiple tasks, your billable hour efficiency goes up.

   • That means you can reduce your per-hour rate while still hitting strong margins.

Final Thought

Building a pricebook is complicated work. It takes time, iteration, and discipline.

But it’s absolutely necessary if you want to operate like a best-in-class service organization. A well-built flat-rate pricebook gives you deep insight into business performance—down to the individual task level—and empowers your team to deliver consistent, high-integrity service in every home.

#grateful to have ServiceTitan sponsoring this section of TPLT; Pantheon 2025 will be held Sept 17-19 in Anaheim, CA.

CEO: Growth Mindset

How Privately Held Companies Can Access Financing Through Commercial Banks

One of the most powerful tools for growth as a privately held company is access to credit. But like any tool, debt has to be used wisely.

For independent businesses, too much debt can substantially increase risk and eliminate any margin for error. Prudent, disciplined use of leverage can strengthen your company. Reckless use can sink it.

Why Size Matters

As a general rule, access to credit gets easier as your business grows:

• Rates become more competitive

• Personal guarantees fall away

• Covenants loosen

• Structures become increasingly flexible

But size alone doesn’t determine your options. Banks want confidence that your business is resilient, profitable, and well-managed. Which means telling your story effectively is just as important as your financial statements.

What Banks Want to Know

When evaluating a loan, commercial banks focus on three key areas:

1. Business model resilience

• Do revenues swing wildly with the economy, or are they steady?

• Is your product/service discretionary—or a “must-have” regardless of conditions?

2. Gross margins

• Are your margins healthy and stable?

• Do you hold pricing integrity, or do you constantly discount to win work?

• Higher margins = more cushion to absorb unexpected shocks.

3. Recurring revenue

• Is your business transactional (one-and-done) or recurring?

• For residential HVAC, this often shows up in membership bases.

• Example: At HB Solutions Group, we have 20,000+ monthly Home Protection Plan subscribers covering 50,000+ pieces of equipment. This creates predictability banks love.

How We Approach Financing at HB Solutions Group

• We maintain $25M of availability on our operating company’s line of credit.

• In our real estate business, we leverage long-term structures with up to 25-year amortizations.

• We’ve earned favorable terms by demonstrating:

  • Consistent growth + performance

  • A recession-resistant, non-discretionary business model

  • Leadership committed to disciplined, prudent debt usage

Because of this, banks are eager to finance our growth—and they offer us their best terms.

A Final Thought

The best time to ask for financing is when you don’t need it.

If you wait until your back is against the wall, your terms will be far worse than if you build a facility in a position of strength.

So—even if you don’t think you need financing today—go set up a line of credit anyway. Use it sparingly. Build a track record of performance and responsible debt management.

That way, when the right opportunity comes along, you’ll be ready.

CyberNetic Labs - bringing powerful Agentic AI tools to the trades

Why Capacity Management is the Lifeblood of Our Industry

In the home services industry, success isn’t just about generating demand—it’s about matching demand to your available capacity every single day.

If you don’t know how much work your team can handle, you either:

• Leave money on the table by underutilizing your field pros, or

• Overspend on marketing and overschedule your team, leading to chaos and poor customer experience.

That’s why capacity management is one of the most important disciplines in our business.

The Goal: 100% Capacity, All the Time

Every day, across every business unit and geographic market, we aim to operate at 100% of available capacity—no more, no less.

Doing this well requires three key steps:

1. Know your throughput.

• How many calls can each field pro complete per day—on average?

• This is the foundation of your scheduling capacity.

2. Automate adjustments.

• Your capacity isn’t static. It changes every day.

• Variables include:

  • Team meetings

  • Unexpected absences

  • Pre-sold full-day jobs

• Automations ensure your available capacity flexes up or down in real time.

3. Prioritize calls clearly.

• Not every customer request should be scheduled the same way.

• Example:

  • New customer calling for an à la carte HVAC maintenance = may wait two weeks.

  • Existing membership customer with a 15-year-old broken A/C = must be scheduled today.

• A clear prioritization system ensures the right call takes the next available slot.

The Complexity (and the Payoff)

Building effective capacity management tools is not simple. It requires:

• Deep operating expertise – understanding the rhythms of the business and the realities of the field.

• Seamless technology integration – tools that work within your existing systems, not against them.

But when it’s done well, the payoff is enormous.

How We Do It at HB Solutions Group

At HB Solutions Group, we’ve built a world-class capacity management tool designed for our industry. It allows us to:

• Keep our team’s schedules full—without overloading them.

• Ensure the highest priority work gets done first.

• Avoid wasting money on marketing when our capacity is already full.

In short: it gives us control over our most precious resource—time.

Final Thought: Capacity management may not sound glamorous, but it’s the difference between a company that’s constantly chasing its tail and one that delivers world-class customer experiences while growing profitably.

#grateful to have Cybernetic Labs sponsor this section of TPLT

Consumer Financing¹

The Power (and Cost) of 0% Financing Programs

One of the most effective ways to create a compelling offer for homeowners is through 0% financing programs.

It’s easy to see why these programs resonate: they give customers a way to afford big-ticket projects without the burden of interest. In many cases, the presence of a 0% financing option can be the deciding factor in whether or not a customer says “yes” to the work.

The Hidden Cost: Dealer Fees

Of course, there’s no such thing as a free lunch.

Contractors know that offering long-duration, 0% interest programs comes with a high upfront cost in the form of dealer fees. These fees can cut deeply into margins—sometimes so much that the program itself feels like a double-edged sword.

At HB Solutions Group, we’ve seen strong customer demand for these programs, particularly the longer-duration options. But we continue to wrestle with how to balance the value of closing more work against the cost of sacrificing margin upfront.

What We’re Seeing

• Anecdotally, demand from customers remains high for long-term, 0% interest offers.

• Many contractors report real success with these programs, using them as a differentiator in competitive markets.

• The key challenge is finding a structure that both wins the job and protects profitability.

We Want to Hear from You

This is where I’d like to tap into our community of readers:

• Are you offering 0% financing programs in your business?

• Which programs are you seeing customers gravitate toward most?

• Have you been able to structure these offers in a way that drives growth without sacrificing too much margin?

Reply to this email and share your experiences—I’d love to feature some real-world insights in a future issue.

Final Thought:
0% financing programs can be powerful tools. But like all tools, they need to be used carefully. When structured well, they can create compelling offers that customers love. The challenge—and the opportunity—is in finding the balance.

#grateful to have GreenSky® Home Improvement sponsor this section of TPLT

¹ The views and opinions expressed here are owned by The Path Less Traveled and its author and may not reflect the views of GreenSky®

Friends of The Path Less Traveled

Who are the VENDORS that fuel our success?

MARKETING

Choosing a marketing agency that is both (1) competent and (2) CARES about your specific business is hard. Over the last 5 years, I have become great friends with the founder of RYNO Strategic Solutions, Chris Yano, and can say with confidence that his agency is among the few that I would trust with my own brands. If you are searching for a partner, send a note to Jeff Bowab at [email protected] and tell him that I sent you.

PAYROLL & HR

Inova Payroll & HR has been a partner to our companies for over 10 years. They have provided us with a payroll technology platform that has been able to keep pace with the demands of our fast-growing organization (now serving team members across 4 states). Inova’s platform works seamlessly with our CRM, ServiceTitan, and with our accounting back-end, Sage Intacct.

COACHING & TRAINING

If there is one organization - perhaps more than any other - that has fueled our growth over the last 10 years… that organization would be Nexstar Network. I like to say that Nexstar Network has built & refined a “process playbook” that touches on so many facets of our business. Don’t try and re-create the wheel… come and learn from the best. Reach out to my friend Kara Schuster at [email protected] and tell her that I sent you.

#grateful for the “Friends of TPLT” sponsors in this section

Hey…I could use your help connecting with like-minded business leaders:

If you know someone who should read The Path Less Traveled - please forward this email them: https://thepathlesstraveled.beehiiv.com/subscribe

Follow along on social…

Chris Hoffmann

on X at @stlChrisH

on LinkedIn @stlChrisHoffmann

on Instagram @Christopher.m.hoffmann

Our Companies:

www.hoffmannbros.com

www.fergusonroofing.com 

www.blueskyplumbing.com

www.hbsolutionsgroup.com 

If you have feedback, questions or comments - please don’t hesitate to reply to this email. I personally monitor all replies.

-Chris