Prycebook Glossary
Pricing terms, in plain English
Short definitions of the words that come up when you price service work, each with a worked example and a calculator.
Last updated October 24, 2026
- Flat-rate pricing Flat-rate pricing is quoting one fixed price for a defined job, set before the work starts, whatever the hours turn out to be.
- Time and materials Time and materials billing charges the customer for the hours worked at an hourly rate, plus the parts and materials used, usually with a markup.
- Markup vs. margin Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price. The same sale gives a smaller margin than markup.
- Overhead recovery Overhead recovery is building the cost of running the business, such as rent, insurance and office pay, into the rate you charge for each billable hour.
- Burdened labor rate A burdened labor rate is what an employee costs you per hour: the wage plus payroll taxes, insurance, benefits and other costs that come with the job.
- Break-even rate A break-even rate is the lowest hourly rate that covers a worker's burdened cost plus a share of overhead, leaving no profit. Anything above it is profit.
- Price book A price book is a maintained list of the services and parts a company sells, each with a set price, so every quote starts from the same numbers.
Set the prices once
Keep your prices and costs in one price book, and build every quote from it.
14-day free trial. No card required to sign up.