Understanding Do & Charge vs Lump Sum

One of the most important decisions when creating a quote in JGID is choosing whether a Service Item should be Do & Charge or Lump Sum.

This setting determines how the customer is charged, how labour is tracked, and how invoices are calculated.

Understanding the difference will help you quote accurately and avoid unexpected billing outcomes.

The Core Concept

There are two ways to sell labour.

Do & Charge

With Do & Charge, the customer is charged for the actual quantity completed.

The quantity on the Quote is simply an estimate.

As technicians complete Worksheets or Timesheets, the billable quantity increases.

The final Invoice is based on the actual quantity worked, not the original estimate.

Lump Sum

With Lump Sum, the customer is charged a fixed agreed price.

The quoted quantity is used for estimating only.

Even if more (or fewer) hours are worked, the customer still pays the original quoted amount.

The labour tracking remains accurate internally, but the selling price does not change.

How JGID Calculates Each Option

Do & Charge

Example:

Quoted:

1 Hour
$100 per Hour

During the Job:

Technicians record 3 billable hours.

Invoice:

3 × $100 = $300

The invoice automatically reflects the actual work completed.

Lump Sum

Example:

Quoted:

1 Hour
$100

During the Job:

Technicians record 3 hours.

Invoice:

Still $100

The customer pays the agreed fixed price regardless of the actual hours worked.

Why Do & Charge Exists

Do & Charge is ideal when:

The scope is uncertain.
Work is charged by the hour.
The final quantity cannot be accurately predicted.
The customer expects to pay for actual time worked.

Examples include:

Call-outs
Maintenance
Reactive repairs
Day works
Labour hire
Schedule of rates contracts

Why Lump Sum Exists

Lump Sum is used when you've agreed to complete a defined scope for a fixed price.

The customer knows the final cost before work begins.

Examples include:

Fixed-price installations
Quoted projects
Contract works
Supply and install packages

Understanding the Red Labour Indicator

When technicians complete Worksheets, JGID compares:

Estimated Quantity

Actual Quantity

If Actual exceeds Estimated, the quantity turns red.

However, the meaning depends on the pricing method.

Do & Charge

Red simply indicates that you've exceeded your estimate.

This is usually not a problem because the customer is charged for the additional hours.

The invoice value automatically increases.

Lump Sum

Red indicates your labour has exceeded the estimate without increasing the selling price.

This is an early warning that the job may become less profitable.

Important Concept: Estimates vs Actuals

Regardless of pricing method, JGID always records:

Estimated Quantity
Actual Quantity

This allows managers to compare:

Quoted hours
Actual hours
Labour performance
Profitability

Even when using Lump Sum pricing, actual labour is still extremely valuable for reporting and improving future estimates.

Frequently Asked Questions

Why did my invoice increase automatically?

Because the Service Item is set to Do & Charge.

Invoices are generated using the actual billable quantity recorded on Worksheets or Timesheets.

Why didn't my invoice increase even though we worked more hours?

Because the Service Item is set to Lump Sum.

The customer pays the agreed fixed price.

Why are my quantities showing in red?

Red indicates the actual quantity has exceeded the estimate.

For Do & Charge this usually means additional billable work.

For Lump Sum it may indicate reduced profitability.

Can I still record actual hours on Lump Sum jobs?

Yes.

Actual hours should always be recorded.

This information is used for productivity reporting and improving future quotations.

Summary

Choose Do & Charge when the customer is paying for the actual quantity completed.

Choose Lump Sum when you've agreed on a fixed selling price.

Although both methods record actual labour, they calculate invoices differently and provide different commercial outcomes.