Variable Rates

Variable Rates give you more control over how to price projects.

Using variable pricing parameters, you can manipulate the level of effort, service price, service cost, product price, and product cost based on the quantity of instances of a service or product in a project.

Configuring Variable Rates in Settings

To use variable rates, first set up a Service or Product in Settings.

For Services, you can set up hours or Service Price/Cost-based variable rates.
For Products, you can set up Product Price/Cost variable rates.

In the below example, we will look at setting up a service with variable rates and will explain the function of all the types of variable rates as we go.

Depending on the context, the function may be labeled as Advanced Cost & Effort. You can see in this screenshot that you have the option to apply advanced cost and effort at the Service Level right below the phase settings and at the subservice level by clicking the gear icon.

On this screen: The service settings form shows phase assignment controls near the top. Below the phase settings is a Set Advanced Cost & Effort button at the service level. On any subservice rows in the table, a gear icon button appears in the actions column. Clicking either opens the Advanced Cost & Effort slideout panel.

When you click Set Advanced Cost & Effort (or Advanced Cost & Effort Apply - View / Edit if rates are already configured), the platform displays a series of tables that enable you to set up your complex pricing structure.

On this screen: A slide-out panel titled “Advanced Cost & Effort” opens from the right side of the screen. It contains three sections stacked vertically: Variable Hours, Fixed Price, and Fixed Cost. Each section shows a table with three columns: Min Qty, Fixed Amt, and Unit Amt. Existing rows display a pencil icon to enter edit mode and a trash icon to delete. When editing, the Min Qty and Fixed Amt fields become number inputs, and the Unit Amt field becomes a number input with a checkmark (save) and X (cancel) button. An + Add variable hours, + Add fixed price, or + Add fixed cost link appears below each table to add a new row.

On Products, you can access the price and cost settings by clicking on the Variable Rates tab above the Product information after you’ve saved your product.

On this screen: The product detail view shows a tab strip at the top. After saving a product, a Rates tab becomes available alongside the other product information tabs. Clicking this tab reveals the variable rate configuration for that product.

From there, you can access the variable rate table for that product.

On this screen: The Rates tab for a product shows two sections: Variable Product Price and Variable Product Cost. Each section contains a table with Min Qty, Fixed Amt, and Unit Amt columns. Rows show a pencil icon for editing. Number fields appear when a row is in edit mode, with save and cancel controls on the Unit Amt column. An + Add Variable Product Price or + Add Variable Product Cost link appears below each table.

The areas of a service you can set a variable rate on are:

Variable Hours: You can configure the platform to calculate the level of effort needed to complete the service, based on the quantity tiers of a specific service or subservice. Units in this area are hours.
Service Price: You can configure the platform to override the Resource Rate and level of effort to achieve a fixed fee price for the service or subservice based on different quantity levels that you define. Units in this area are dollars.
Service Cost: You can configure the platform to override the Resource Cost and calculate the cost of the service or subservice based on different quantity levels that you define. Units in this area are dollars.
Product Price: You can instruct the platform to calculate the Product Price based on different quantity levels that you define. Units in this area are dollars.
Product Cost: You can instruct the platform to calculate the Product Cost based on different quantity levels that you define. Units in this area are dollars.

The individual elements you can define per minimum quantity are:

Fixed Amount: This is the amount to account for quantities below the minimum quantity.
Per Unit Amount: This is the amount added per unit at and above the minimum quantity threshold you define, up until (but not including) the next minimum quantity, if applicable.

Setting Variable Rate Structures

Hours-based Variable Rates

For this Variable Rates structure for hours on a service or subservice:

On this screen: The Variable Hours table in the Advanced Cost & Effort slideout shows two rows. The first row has Min Qty = 1, Fixed Amt = 0, Unit Amt = 10. The second row has Min Qty = 11, Fixed Amt = 100, Unit Amt = 8. This represents two tiers: for quantities 1-10, 10 hours per unit with no fixed base; for quantities 11 and above, 100 fixed hours plus 8 hours per unit.

When I add this service to a project, for quantities 1-10, it will only add 10 hours for every unit of quantity I add. There are 0 fixed hours, so no amount is added there.

For quantity = 1, effort is 10 hours (0 fixed + 10 per unit * 1 quantity)
For quantity = 5, effort is 50 hours (0 + 10*5)
For quantity = 10, effort is 100 hours (0 + 10*10)

For quantities of 11 and up, there is a base of 100 hours added initially, and then 8 hours added for every additional increment.

For quantity = 11, effort is 108 hours (100 + 8*1)
For quantity = 15, effort is 140 hours (100 + 8*5)
For quantity = 100, effort is 820 hours (100 + 8*90)

Dollars-based Variable Rates

The same logic applies if you set up a Variable Rate service for service price/cost or product price/cost.

For this Variable Rates structure for the Hours & Service Price on a service or subservice:

On this screen: The Advanced Cost & Effort slideout shows both the Variable Hours section and the Fixed Price section populated. The Variable Hours table has two rows: Min Qty = 1, Fixed Amt = 0, Unit Amt = 10; and Min Qty = 11, Fixed Amt = 100, Unit Amt = 8. The Fixed Price table has two rows: Min Qty = 1, Fixed Amt = 0, Unit Amt = 1500; and Min Qty = 5, Fixed Amt = 6000, Unit Amt = 1000. The Fixed Cost section is empty, indicating service cost will be calculated from hours and resource rate.

Since I have not defined a Variable Rate for Service Cost, it will continue to be calculated from the level of effort and the resource rate. In this example project, the Hourly Cost for the Resource is $90/hour.

When I add this service to a project…

For quantity = 1

Effort = 10 hours (0 fixed + 10 per unit * 1 quantity)
Service Price = $1,500 ($0 fixed + $1,500 per unit * 1 quantity)
Service Cost = $900 ($90 per hour resource rate * 10 hours)
Gross Profit is $600, Margin is 40%

For quantity = 4

Effort = 40 hours (0 fixed + 10 per unit * 4 quantity)
Service Price = $6,000 ($0 fixed + $1,500 per unit * 4 quantity)
Service Cost = $3,600 ($90 per hour resource rate * 40 hours)
Gross Profit is $2,400, Margin is 40%

For quantity = 5 (Service Price Minimum quantity reached)

Effort = 50 hours (0 fixed + 10 per unit * 5 quantity)
Service Price = $7,000 ($6,000 fixed + $1,000 per unit * 1 quantity)
Service Cost = $4,500 ($90 per hour resource rate * 50 hours)
Gross Profit is $2,500, Margin is 35.71%

For quantity = 10

Effort = 100 hours (0 fixed + 10 per unit * 10 quantity)
Service Price = $12,000 ($6,000 fixed + $1,000 per unit * 6 quantity)
Service Cost = $9,000 ($90 per hour resource rate * 100 hours)
Gross Profit is $3,000, Margin is 25%

For quantity = 11 (Hours Minimum quantity reached)

Effort = 108 hours (100 fixed + 8 per unit * 1 quantity)
Service Price = $13,000 ($6,000 fixed + $1,000 per unit * 7 quantity)
Service Cost = $9,720 ($90 per hour resource rate * 108 hours)
Gross Profit is $3,280, Margin is 25.23%

For quantity = 20

Effort = 180 hours (100 fixed + 8 per unit * 10 quantity)
Service Price = $22,000 ($6,000 fixed + $1,000 per unit * 16 quantity)
Service Cost = $16,200 ($90 per hour resource rate * 180 hours)
Gross Profit is $5,800, Margin is 26.36%

As you can see from the above examples, Variable Pricing gives you a lot of control over your project pricing.

Using Variable Rates in a Project

If a Variable Rate is applied to a service or subservice, the field that allows you to override the number of hours on a per-service basis will be non-editable, with a note that Variable Rates have been applied to that element.

In the Project…

You can add a Service or Product that contains a variable rate to a project like any other element.
Once added, the quantity will update the effort and pricing information as directed by the variable rate.

Variable Rates are a powerful feature that allows you even greater control of your project pricing in ScopeStack.

On this screen: The workflow for adding a variable-rate service to a project and watching the pricing update in real time. When a service with variable rates is added to a project, the quantity field updates the effort and pricing columns automatically. The hours override field for that service displays as read-only with a note indicating variable rates are applied. Changing the quantity in the project updates the calculated effort and price according to the configured tiers.