Lead-Service Fees and Dispatch Commissions: Tracking Them for Locksmiths and Garage Door Companies

What locksmith and garage door books need to track

A locksmith or garage door job is not one flat number. It is the call that came in, the parts that went on the lock or the door, the time the tech spent on site, the lead fee you paid to get the call, and the commission you paid to the person who sent the tech out. Each one needs its own line so the profit per job is real.

When all of those costs sit in one pile, you can not tell if a job paid. The lead fee might have been the biggest cost on the job, but it sits in a general advertising line where you never see it tied to the call it brought in. The dispatch commission might come out of every check, but it never lands on the job it earned. When the costs do not follow the job, the profit per job is a guess.

A clean job carries its own costs. The parts sit on the job. The labor sits on the job. The lead fee sits on the job. The dispatch commission sits on the job. When you run the profit and loss by job, every cost shows up in the right place.

Here is what a clean job looks like.

When each line ties to the job, your profit per job is real. When they sit in one pile, you are guessing.

How lead service fees show up in your books

A lead service is a platform that sends you calls. You pay a fee for each call or each job that comes through. The fee is the cost of getting the work in the door.

The clean way is to book the lead fee to the job it brought in. When you pay the platform, the fee lands on the job that came from it. When you run the profit and loss by job, the fee sits right there next to the income, and you can see if the job paid after the cost of getting it.

The messy way is to book every lead fee to one flat advertising line and leave it there. Now the fee is gone from the job. The job looks more profitable than it was. At month end, you can not tell which leads were worth paying for and which ones cost more than the job brought in.

Here is how to keep lead fees clean.

• **Book the lead fee to the job it brought in: ** not to one flat advertising line.
• - **Tag the fee with the platform name: ** so you can sort by where the lead came from.
• - **Compare the fee to the job income: ** so you know if that lead was worth it.
• - **Watch for jobs that came from the same platform: ** see if one platform sends better leads.
• - **Review the fees each month: ** a platform that raises its fee changes your margin.

When the lead fee follows the job, you can see which platforms pay off and which ones do not. You can read more about how we keep costs tied to the job on our bookkeeping page.

How dispatch commissions show up in your books

A dispatch commission is what you pay the person who sends the work out. The dispatcher takes the call, picks the tech, and sends them to the job. You pay a cut for that work. The cut is a cost on the job.

The clean way is to book the commission to the job it served. The dispatcher sent the tech to that job, so the commission belongs on that job. When you run the profit and loss by job, the commission sits next to the labor and the parts, and the profit shows the real cost of getting the work done.

The messy way is to book the commission to a general wages line or a flat overhead line. Now the cost is gone from the job. The job looks better than it was, and the dispatcher cost hides in a pile where no one can see it.

Here is how to keep commissions clean.

• **Book the commission to the job it served: ** not to a flat overhead line.
• - **Tie the commission to the tech who ran the job: ** so you can see the full cost of that crew.
• - **Compare the commission to the job income: ** so you know if the job paid after the cut.
• - **Watch for jobs where the commission was high: ** a big cut on a small job eats the margin.
• - **Review the commission setup each quarter: ** see if the split still makes sense.

When the commission follows the job, you can see the real cost of the dispatch side. When it sits in a pile, the cost is invisible.

How to tie fees and commissions to the job

The lead fee and the dispatch commission are two costs that most locksmith and garage door books get wrong. Both come in through the door before the parts go out, and both sit in the wrong place when no one ties them down.

The clean way is to tag every job with a class or a project name in QuickBooks Online. When the lead fee comes in, it goes to that class. When the commission goes out, it goes to that class. When the parts and the labor go on the job, they go to that class. At month end, the class pulls it all together, and the profit per job shows every cost.

The messy way is to skip the class tag. The parts go on the job. The labor goes on the job. But the lead fee goes to advertising and the commission goes to overhead. Now the job looks good, but the real profit is lower, and no one can see why.

Here is how to tie it all together.

• **Set up a class or project for each job: ** so every cost has a place to land.
• - **Book the lead fee to the class: ** not to a flat advertising line.
• - **Book the commission to the class: ** not to a flat overhead line.
• - **Book the parts and the labor to the class: ** so all four costs sit together.
• - **Run the profit and loss by class at month end: ** so the real profit per job shows.

When all four costs sit on the same class, the profit per job is real. When two of them sit in a pile, the profit per job is a lie that makes you feel good until the bank runs low.

How to see if a job paid after the fees

The whole point of tying the fees to the job is seeing the answer to one question. Did this job pay after the lead fee and the commission?

When the costs follow the job, the answer is right there. The income sits at the top. The parts, the labor, the lead fee and the commission sit below it. The gap is the real profit. When the gap is thin, the job barely paid. When the gap is negative, the job cost you money.

When the costs do not follow the job, you can not answer that question. The income shows on the job. The parts and the labor show on the job. But the lead fee and the commission are gone. The job looks like it paid, but the real profit was lower or maybe negative.

Here is a simple check.

• **Pull the profit and loss by job: ** not by total income.
• - **Look for the lead fee on the job: ** if it is missing, it is sitting in advertising.
• - **Look for the commission on the job: ** if it is missing, it is sitting in overhead.
• - **Compare the income to all four costs: ** the gap is the real profit.
• - **Flag jobs where the gap is thin or negative: ** those are the ones that need a higher price or a different lead source.

How the month end close works

At month end, every job needs its costs added up. The parts, the labor, the lead fee and the commission pull together into one job total. The income sits next to it. The gap is the real profit for the job.

We start with the bank. We match each payment to the invoice it paid. We pull the lead fee charges and tie each one to the job it brought in. We pull the commission payments and tie each one to the job it served. We tie the parts and the labor to the job. Then we add up the month by job. We send you the profit and loss report, and the job totals sit inside it.

Here is a simple month end check.

• **Match each payment to the bank: ** every deposit cleared.
• - **Tie each lead fee to the job it brought in: ** not to a flat advertising line.
• - **Tie each commission to the job it served: ** not to a flat overhead line.
• - **Confirm each job carries a class tag: ** so the costs pull together.
• - **Run the profit and loss by job: ** so the real profit per job shows.

When the close runs every month, the jobs stay clear. When it skips a month, the costs pile up and the next month is harder to close.

A situation we clean up

The jobs that all looked good

A locksmith company runs four techs and takes calls from two lead platforms. Every lead fee goes to one flat advertising line. Every dispatch commission goes to a flat wages line. The parts and the labor go on the job. At month end, every job looks profitable. But the bank keeps running low, and the owner can not tell why.

Here is how we handle it. We go back through the lead platform charges and tie each fee to the job it brought in. We pull the commission payments and tie each one to the job it served. We add a class to every job so the costs pull together. When we are done, the owner can run the profit and loss by job and see the real profit. Some jobs that looked good barely broke even after the lead fee. A few lost money. The owner can see which platform sends the leads that pay and which one sends the leads that cost more than they bring in. We set up a rule so the next lead fee carries the job tag from the start.

Mistakes we fix

• Every lead fee booked to one flat advertising line with no job tag
• Every dispatch commission booked to a flat wages line or overhead line
• Parts and labor on the job but the fees and the commissions gone
• No class or project tag on any job
• No profit and loss by job run at month end
• Jobs that looked good but barely broke even after the fees
• No way to tell which lead platform sends the leads that pay
• A commission setup that no one reviewed in a year
• A big commission on a small job that ate the margin and no one saw it

Common questions

How do I book a lead service fee? Book it to the job the lead brought in, not to a flat advertising line. Tag it with the platform name so you can sort by where the lead came from. When the fee follows the job, you can see if the lead was worth it.

How do I book a dispatch commission? Book it to the job the dispatcher served, not to a flat overhead line. The commission is a cost on the job, so it belongs next to the labor and the parts. When it follows the job, the real profit shows.

How do I see if a job paid after the fees? Run the profit and loss by job. The income sits at the top. The parts, the labor, the lead fee and the commission sit below it. The gap is the real profit. If the gap is thin or negative, the job did not pay.

Do you handle bookkeeping for locksmith and garage door companies? Yes. We tie the lead fees, the dispatch commissions, the parts and the labor to the right job, so your profit per job is real and your month closes on time.