Three market conditions impacting field service costs

By Wael Mohammed, EVP of Strategy, Field Nation

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Cost matters—to field technicians and service delivery companies alike. Over the past year, technical resource costs in the field services space have risen roughly 10 percent across the board. Market conditions are impacting field service’s bottom line across three dimensions:

Travel

Gas costs are up 40% YoY, making it more expensive for field techs to get from worksite to worksite. Overall costs related to travel have increased by 6%.

Equipment

Rising equipment costs are also increasing the price tag on each individual job. Overall equipment costs are up 18%, which impacts the cost of all types of work.

Labor

According to the US Department of Labor, the average wages of private sector workers increased by 5% over the course of 2021.

Generally speaking, field service costs are up 8%, with some variance based on type of work and service-level agreement turnaround. Three dominant factors are pushing technical labor rates up: inflation, the great technology reset in retail, and a labor shortage in the field services space.

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ABOUT THE AUTHOR

Wael Mohammed

Wael Mohammed has been in the IT services industry for more than 27 years. He has held leadership roles in startups and large enterprises, including SPS Commerce, IBM, and Target. Wael is currently the Executive Vice President of Strategy at Field Nation and oversees product management, product design, and data science. He is a master in identifying product and market growth opportunities, taking new products to market, and maximizing product performance.

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