Charge for travel time by pricing the mile, not by guessing. Add your vehicle's operating cost per mile to your technician's loaded hourly cost divided by your average door-to-door speed — that is what one travel mile actually costs you. Then recover it with a zone schedule that folds nearby travel into your base service fee and charges a flat, disclosed amount for anything farther out.
Why How You Charge for Travel Time Decides Your Margin
Travel is not a rounding error in a field-service business. Technicians running manual dispatch typically spend 30–40% of the workday behind the wheel, and best-in-class operations still sit above 20% (windshield time benchmarks). Service technicians average roughly 15,000 business miles a year (Everlance), or about 58 miles per working day.
If a third of your paid labor hours produce no billable work, and you are not recovering that anywhere, your effective hourly rate is far lower than the number on your invoice. Most shops discover this only when they run job costing and find the far-out jobs are the unprofitable ones.
What One Travel Mile Actually Costs You
There are two costs stacked in every mile: the truck and the tech. Use this formula:
Cost per travel mile = vehicle cost per mile + (loaded labor rate ÷ average door-to-door mph)
For the vehicle number, the IRS business standard mileage rate is a defensible floor. For 2026 it was set at 72.5 cents per mile in January and raised to 76 cents per mile for July through December (IRS). That rate covers fuel, maintenance, insurance, and depreciation — it does not cover a single minute of your technician's time.
For the labor number, use the fully burdened cost of the tech in the seat, not their wage. If you have not calculated that, start with your labor burden rate.
A worked example at $0.76 per mile, a $55 per hour burdened tech, and a realistic 30 mph average door-to-door speed:
| Component | Calculation | Cost per mile |
|---|---|---|
| Vehicle | IRS 2026 rate | $0.76 |
| Technician | $55 ÷ 30 mph | $1.83 |
| Total | $2.59 |
That number reframes the whole problem. A job 20 miles out is 40 round-trip miles, or about $104 of real cost before anyone opens a toolbox. Contractors who bill travel at $0.75 to $1.25 per mile (FieldCamp) are recovering roughly a third of it.
Key takeaway: a per-mile rate borrowed from the IRS reimburses your truck. It does not pay your technician. Any travel charge built only on mileage is structurally short by the larger of the two numbers.
Use your own average door-to-door speed, measured from dispatch timestamps — not the posted speed limit. Dense urban routes often average 18–22 mph, which pushes the labor component well above $2 per mile. Rural highway runs average higher and cost less per mile.
Three Ways to Charge for Travel Time
| Method | How it works | Best for | Weakness |
|---|---|---|---|
| Per-mile rate | Flat rate per mile, often $0.75–$1.25, sometimes round trip | Long-haul commercial and rural work | Ignores labor; customers dispute odometer readings |
| Reduced hourly rate | Bill drive time at 50–75% of your standard labor rate | Time-and-materials and project work | Traffic becomes the customer's problem, which they resent |
| Zone schedule | Fixed travel charge per distance band, quoted at booking | Residential flat-rate service | Needs periodic review as fuel and wages move |
For residential trades running flat-rate pricing, the zone schedule wins. It is a fixed, quotable number the dispatcher can state before the truck rolls, it does not invite an argument about the route, and it drops cleanly into a price book as a line item. If you are still deciding between flat-rate and hourly billing generally, that decision is covered in flat-rate vs. time-and-materials pricing.
How to Build a Travel Zone Schedule
Fold Zone 1 into your base service or diagnostic fee, then charge the incremental cost above Zone 1 for each band out. Charging the full travel cost in every zone double-bills the portion your base fee already covers.
Using the $2.59 per mile figure above and the midpoint of each band:
| Zone | One-way distance | Round-trip travel cost | Cost above Zone 1 | Suggested charge |
|---|---|---|---|---|
| Zone 1 | 0–10 miles | $26 | — | Included in base fee |
| Zone 2 | 10–20 miles | $78 | $52 | $50 |
| Zone 3 | 20–35 miles | $142 | $116 | $115 |
| Zone 4 | 35+ miles | Varies | Varies | Quote per job |
Two adjustments before you publish these numbers:
- Add margin, do not just recover cost. The figures above are cost recovery. Marking a cost up by a percentage is not the same as earning that percentage as margin — if that distinction is fuzzy, read markup vs. margin for contractors and run your numbers through the free margin and markup calculator.
- Check the zone against your close rate. If Zone 3 quotes convert at half the rate of Zone 1, the charge is doing its job of filtering unprofitable distance — or it is priced above what that market will bear and you should stop advertising there.
Should You Offer a Free Travel Radius?
Yes, and Zone 1 is it. A free radius is a marketing decision disguised as a pricing one: it makes your core service area frictionless to book while everything beyond it pays its own way. Set the radius where your Zone 1 travel cost is genuinely absorbed by the margin on a typical job, and no further.
What a free radius should never be is unlimited. "We don't charge for travel" is a promise that quietly transfers every long drive from the customer's invoice to your net profit, and it is nearly impossible to walk back once customers 40 miles out have come to expect it.
Trip Charge, Service Fee, or Travel Charge?
These get conflated constantly, and the distinction matters when a customer challenges the invoice. A trip charge covers getting a truck to the door. A diagnostic fee pays for the skilled work of finding the fault. A travel or zone charge covers distance beyond your standard service area. Many shops present them as one number to the customer while tracking them separately internally — the full breakdown is in our guide on whether to charge a diagnostic fee.
Whatever you call it, quote it when the appointment is booked. Nearly every travel-charge complaint is a disclosure failure, not a price objection.
Keeping Travel Charges Consistent Across Your Team
A zone schedule only works if every dispatcher and technician quotes the same number. The moment travel pricing lives in someone's head, three technicians will quote three amounts and the inconsistency will read as improvisation to customers who compare notes.
Store each zone as a real line item in your price book alongside your labor rates and flat-rate tasks, so it appears on the quote automatically and updates in one place when fuel or wages move. That is exactly the kind of cross-cutting rate that Pricebookr is built to hold and push back out to your field-service software. If you have not built a formal price book yet, start with how to build a price book.
Common Travel-Time Pricing Mistakes
- Billing the IRS rate and calling it done. That rate reimburses the vehicle. The technician's burdened hour is the bigger half of the cost and it goes unrecovered.
- Using posted speed limits instead of measured door-to-door speed. Traffic, parking, and the walk to the unit are all paid time. Measure from dispatch to arrival timestamps.
- Charging full travel cost in every zone. Your base service fee already absorbs Zone 1. Charge the increment above it or you will price yourself out of your own backyard.
- Quoting travel at the door. A charge disclosed after the drive is a dispute. The same charge disclosed at booking is routine.
- Setting zones once and never revisiting. The IRS rate itself moved twice in 2026. A zone schedule built two years ago is almost certainly below your current cost to serve.
- Accepting Zone 4 work at Zone 2 pricing to stay busy. A slow week is not a reason to drive 45 minutes at a loss. Price it properly or fill the slow season a different way.
FAQ
How much should a contractor charge for travel time?
Price it from your own cost: vehicle cost per mile plus your burdened labor rate divided by your average door-to-door speed. At the 2026 IRS rate of 76 cents per mile, a $55 per hour burdened tech, and 30 mph average speed, that comes to about $2.59 per mile, or roughly $104 for a job 20 miles out. Common market rates of $0.75 to $1.25 per mile recover only part of that, which is why a zone-based flat charge usually works better.
Should I charge for travel time or just raise my hourly rate?
Raising your hourly rate spreads travel cost evenly across all customers, which means nearby jobs subsidize far ones and you become uncompetitive close to home. A separate travel or zone charge puts the cost on the jobs that create it. Blending it into the rate is only reasonable if your service area is tight and drive distances barely vary.
What percentage of my hourly rate should travel time be billed at?
Contractors who bill drive time hourly commonly charge 50–75% of their standard rate, on the logic that driving is real paid time but not skilled production. Check the result against your actual cost per mile: at low average speeds, 50% of your rate can fall below what the drive genuinely costs.
Do I charge travel time one way or round trip?
Round trip. The technician cannot bill anyone during the drive home, and the truck accumulates the same wear in both directions. Charging one way silently discards half the cost. If round-trip pricing looks alarming to customers, present it as a single flat zone charge rather than an itemized mileage figure.
How do I explain a travel charge to a customer without losing the job?
State it at booking, tie it to distance rather than to the customer, and name what it covers: "You're in our Zone 2 service area, so there's a $50 travel charge on top of the service fee — that covers the drive out and back." Disclosed up front it is almost never the reason a job is lost. Added at the end, it is.