Dynamic Pricing: Pricing by Measurement

Summary

Dynamic Pricing is the concept of creating variable pricing of services based on the job size. In contrast to fixed pricing, the customer is charged based on measurements of property elements. For example; fertilizing 10,000 sq. feet of grass is charged more than 1,000 sq. feet. This feature simplifies the complex issue of billing large jobs appropriately.

Both Service Types and Add-ons support pricing based on default measurement options of  square feet (SF), linear feet (LF), and count (CNT), as well as other custom units of measure.

There are two ways to capture the measurements: manually taking measurements on-site or remotely using the Property Estimation tool. Whether for Service Types or Add-on services, preferences must be set, and each must be activated first.

Setting Up a Dynamic Priced Service and Add-on

There are a few different places that require setup to use Dynamic Pricing. Depending on how Dynamic Pricing is used determines which settings need to be configured. Property Estimation Categories are not required to use Dynamic Pricing, but more information can be found in both the Property Estimation Tool and Categories guides.

Dynamically Priced Service Types

To add to or set up Dynamic Pricing for a Service Type, go to:

Admin > Preferences > Service Related > Service Types

Choose + Service Type to create the new service with dynamic pricing.

Important:

Only a newly added Service Type template can be dynamically priced. Once saved, the Dynamic Pricing checkbox option will no longer be available as an option.

Activate Dynamic Pricing

Activate Dynamic Pricing by selecting the check box located within the Pricing and Commission section. A popup will display warning that turning on Dynamic Pricing can’t be reversed. To move forward with Dynamic Pricing turned on click the Ok button.

Next select a Unit of Measure from the dropdown. The unit of measure is how the job/property is to be measured for a particular service type. The three listed here are global default units in FieldRoutes but custom Units of Measure can be created in preferences (see Unit of Measure guide).

• SF (Square Feet)

• LF (Linear Feet)

• CNT (Count)

Unit of Measure is available in reporting, and only one Unit of Measure can be added per Service Type.

Category - these are property categories used by the Property Estimation Tool and Dynamic Pricing Service Types (if applicable).

Dynamic Pricing Tables

Dynamic Pricing now provides more flexibility when creating pricing tables. It allows for adding multiple measurement intervals so that the pricing does not have to be so linear.

When creating a Dynamic Pricing table, entering a value in the Start Dynamic Pricing After field is the first step. Since an Initial and Default Service Charge may reflect a specific measurement, setting this number allows incremental pricing to begin once a measurement exceeds this (start after) value. This can be done for Initial Services, Recurring Services, or both.

Next, set the Initial and Recurring: Minimum , Maximum, Per (unit) , and Premium $. Since the Initial and Recurring tables are the same, we provided the definitions together.

• Minimum: On the first line of a table, the Minimum value will be the smallest measurement above the Start Dynamic Pricing After value. Any measurement below this value receives the base Defaultpricing. For all other rows, the minimum is the smallest measurement to be met or exceeded in order for the corresponding lines pricing threshold to take effect.

• Maximum: is the number that a measurement must meet or be under in order for the corresponding lines pricing threshold to take effect.

• Per (SF, LF, CNT, etc.): this field means for each number of units.

  • An example for square feet would be Per SF: 100 - meaning for each 100 SF.

• Premium $: This is the fee charged for every incremental Interval over the Minimum on the corresponding line.

Once a Minimum and Maximum value has been entered, there is a green +Add More button that appears to insert another row below, so that another interval can be added.

The sample table(s) in the below image includes 3 different pricing intervals.

1. The first interval costs $5 per every 10 square feet for jobs measuring between 101 and 200 SF.

2. Once 200 square feet has been exceeded, and as long as it remains under or equal to  400 square feet, then every 10 square feet will cost $3

3. If 400 square feet is exceeded, it will cost $2 for every 10 square feet.

Regardless of what number is in the Maximum field on the last row, the system will treat it as infinity. This is because anything over the minimum number on the last row will be calculated with the corresponding lines per (UofM) and Premium amount values. When empty (below), the calculation will follow the same rules, but the table, when saved recognizes that another row won’t be needed and greys out the button.

Since tables can be categorized, FieldRoutes allows multiple tables to be added to Service Types or Add-ons. Although all tables included must have the same Unit of Measure, it still allows different types of measurements on a property to generate differing costs. Below any existing table, click the + Category Group button to insert a new table.

Once the new table is inserted, select a Category for it and fill out the pricing Intervals.

Remember to click the save button in the upper right when finished.

Dynamically Priced Add-ons

Similar to Dynamic Pricing for Service Types, Add-on's can also use Dynamic Pricing. To create a new Add-on or update an existing one with Dynamic Pricing go to:

Admin > Preferences > Service Related > Add-ons 

Choose the + Add On or Edit an existing one. Choose + Add On button to add a new one or edit an existing Add-on.

Activate Dynamic Pricing

Select the check box to activate Dynamic Pricing. Just as it is for Service Types, activating Dynamic Pricing for an Add-on can't be undone.

Next, select a Unit of Measure, and click in the Category Field to select a Category if desired. There is also a drop-down to select Skills from.

Create a Dynamically priced table for the Add-on. Details for each table field are as described in the earlier section, Dynamically Priced Service Types. Remember to click the Save button once finished.

Dynamic Pricing in a Subscription

When adding a Service Type or Add-on with Dynamic Pricing to a Subscription:

• Input the size (SF, LF, CNT) in the Measurement field to auto-calculate the price. For example, for a 120 SF are, enter 120 in the Numberfield.

  • The Unit of Measure is pre-defined in the Service Type and cannot be changed here.

The Subscription price will auto-calculate based on the Initial Quote and Default Service Charge in combination with the settings in the three Dynamic Pricing fields. Beginning with the base prices, pricing will increase incrementally in steps, adding 1 x the Premium $ for each Interval above the Minimum.

By default Service Types will use the Initial Invoice Template set within Admin > Office Settings > Preferences. Directly underneath where pricing tables are added in Service Type Setup, there is a default check box that can be overridden (when unchecked) so that Invoice Template pricing specific to the Service Type can be used instead. One indicator that the Office Setting Preference is being used would be that there is no calculation for the Recurring Invoice Template. 

Example 1: This customer has a Subscription for a Service Type, and the Landscape Bed service area is calculated to be 83 square feet. Since it falls within the threshold size for the Minimum charge (100SF), it is priced at $100 for the Initial Service (Initial Quote) and $150 for the Recurring Service (Default Service Charge). Of course other Discounts, Add-ons , and taxes are calculated and applied normally.

Example 2: Suppose another Customer has a larger property that exceeds the Minimum threshold size of 100 sf. Here the property is 559 sf. So the base pricing applies, but now Premium increments are added. For each 10 SF of additional size (the Interval) - full or partial - another Premium is added. it is priced at $242 for the Initial Service (Initial Quote) and $282 for the Recurring Service (Default Service Charge).

Below is the corresponding table used for both the Initial and Recurring Service calculations in the above example, and underneath that is a breakdown of how the price was calculated.

Initial Service

• • $100 (Initial Quote)

  • $50 for Interval 1 (101-200SF @$5 per 10SF)

  • $60 for Interval 2 (201-400SF @$3 per 10SF)

  • $32 for Interval 3 (401-600SF @$2 per 10SF)

  • = $242 Total

Recurring Service

• • $150 (Default Service Charge)

  • $40 for Interval 1 (101-200SF @$4/10SF)

  • $60 for Interval 2 (201-400SF @$3/10SF)

  • $32 for Interval 3 (401-600SF @$2/10SF)

  • = $282 Total

Editing Measurements on an Invoice

Measurements can be changed directly from an invoice. If any changes have been made to the Service Type Admin configuration since the invoice was generated; upon clicking the Pencil button to make edits, the invoice price will automatically update.

On the invoice below, the Initial balance is 97.29. Click the Pencil button to make edits.

In this example, the Invoice balance immediately goes up with the Pencil button clicked since changes have been made to the Service Type since the Invoice was generated. Clicking the Undo button will revert the balance and the Undo button back to the Pencil button.

If the pricing preferences are acceptable, update the unit of measure field with the new measurement and click the Close button or move to another tab.

Route Optimization Using Measurement and Commercial Vehicle Requirements

In conjunction with Dynamic Pricing on Service Types using measurement, Intelligent Routing can now use the measurements from these Service Types and adjust routes based on vehicles' carrying capacity for chemical supplies that are consumed based on the square footage or linear footage, such as Lawn Fertilization or Ant Bait.

New filters for the Measurement and Service Category now appear on the Scheduling area's Visual Grouping and Intelligent Routing interfaces.

In addition, once the filtered Appointments have been chosen using the Intelligent Routing filters, selecting Create Optimized Routes launches the optimization process. This opens a new window where several measurement-based and commercial vehicle parameters may be provided.

There are two approaches to select from when optimizing:

1. Equal Stop: This option optimizes based on an equal distribution of stops to each available technician, regardless of efficiency. For example, if there are 80 stops for the day, and 10 available technicians, 10 routes of 8 stops each will be created. The only settings compatible with the Equal Stop option are Max Stops and Max Minutes. Adding any other of the parameters requires the selection of Auto Optimize.

2. Auto Optimize: Multiple parameters may be set, and the Intelligent Routing process will take each one into account and assign variable numbers of stops to each route based on the most efficient groupings considering drive time, service time on site, vehicle limitations, and supply capacity for measurement based services.

The following parameters are available before optimization:

• Max Stops: Puts an upper limit to the number of stops allowed on an individual route.

• Max Minutes: Optimizes considering an upper limit on how many minutes are allowed on each route, including drive time and time on site. This may produce variable numbers of stops for each route, with greater shorter stops in closer proximity and fewer, lengthier stops that require more drive time between.

• Max Square Feet: Considers the service capacity of a single vehicle (of lawn of chemical, for example) based upon the maximum service capacity measured in total square feet to ensure the route does not exceed this capacity.

• Max Linear Feet: Likewise considers the service capacity of a single vehicle (of ant bait, for example) based upon the maximum service capacity measured in total linear feet to ensure the route does not exceed this capacity.

• Same Side Routing: Some vehicles deliver products using a hose or other equipment that should not cross traffic lanes. Assigning this preference indicates the desired direction a vehicle should arrive at and depart from the location. Options here are:

  • N/A: The default, meaning the side of the street is not a consideration

  • Right: The route stops will be arranged in the order most likely to provide clear right-side access

  • Left: The route stops will be arranged in the order most likely to provide clear left-side access

• Commercial Vehicle Routing: Assigning this parameter will avoid truck-restricted roads and use preferred truck routes while ensuring the route will honor one-way streets.

• Hazmat Routing: Assigning this parameter will exclude roads where transporting hazardous material is prohibited.

• Bridge Height (meters): Assigning a height limit requires the route to avoid overpasses or bridges that do not accommodate the specified height.

For the Equal Stop option, set only the Max Stops and Max Minutes if desired, then select Optimizing Using Equal Stop. Once additional parameters are set, the Optimize Using Auto Method becomes the only available option.

Reporting for Measurement

Some columns exist in the Customers Report to support Dynamic Pricing.

Under Select Columns to Display, there are four new options:

• SF Subscription Measurement Value: provides a subscription-by-subscription view of the measurement value for SF. This value does not include Initial Services (if Initial differs from Recurring) or Add-ons.

• LF Subscription Measurement Value: provides a subscription-by-subscription view of the measurement value for LF. This value does not include Initial Services (if Initial differs from Recurring) or Add-ons.

• Total SF Subscription Measurement Value: value includes both the Recurring Subscription and Add-ons associated with that subscription for SF.

• Total LF Subscription Measurement Value: value includes both the Recurring Subscription and Add-ons associated with that subscription for LF.

Additional reporting options with Dynamic Pricing visibility:

• Customers Report >Service Subscription: Category and Unit of Measure (SF and LF) are filters.

• Reporting >Billing By Service Type and Payments by Service Type: in the Group By filter the new option Service Category.