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With a good maintenance contract program, PHC business owners can bring in predictable revenue, especially during slow seasons, and create opportunities for additional “pull-through” service and replacement work. Over the course of multiple maintenance visits, technicians can establish authentic relationships and build trust with customers.
On top of that, a base of maintenance contracts provides structure so business owners can accurately and strategically predict staffing and purchasing needs, helping them deploy resources efficiently.
In short, maintenance agreements provide one of the most efficient, effective routes to financial stability and business growth. Contractors who can set up and sustain a service program are in position to claim a major market advantage over their competitors — an edge that can make a real difference in the health and future of their company during today’s unpredictable economic climate.
Many service teams, however, struggle with maintenance agreement programs. There are some familiar frustrating situations that result when contractors fail to make service contracts a priority.
One common outcome is that they forgo the long-term advantages and opportunities that arise from service agreements and focus on keeping up with seasonal installation and emergency repair. In another, their team expends excessive energy on the routine manual administration of a maintenance program, watching their new revenue evaporate under new overhead costs.
So how can contractors get the rewards of a successful maintenance program without giving up time and money? Here are three keys to do just that:
Plan: It’s essential to spend time evaluating your company and your market before building a successful maintenance plan. An honest, thorough assessment of your business helps you prepare an agreement that is profitable for you and attractive to customers.
When preparing a maintenance program, think about the length of the contract, pricing, renewal options and discounts or incentives for members. Also consider consulting a lawyer for details on the contract.
Invest: Unfortunately, a good service contract program has traditionally required a significant investment of time and labor — which most contractors these days don’t have much of.
A software platform, however, designed specifically for contractors can eliminate the most familiar pain points and friction for managing maintenance agreement programs.
Look for a solution that integrates with your existing digital tools and comes with industry-leading onboarding options so your team has all the resources it needs for an efficient takeoff. Features to expect include preloaded workflows; automated custom pricing; lightning-speed scheduling; and profitability metrics sortable by customer, technician and job.
Empower: Make sure your technicians are equipped to effectively sell maintenance agreements. That means providing them with:
A simple way to kick start your maintenance agreement program is to start with the customers you already have. Leverage the established trust of those relationships to build an initial base, then prioritize contracts with new customers. Include service agreement information in your marketing plan. Make sure your techs and sales teams understand the importance of building a maintenance agreement base and provide them with in-depth training and incentives for contract sales.
Once you have built a significant contract base, you will see other efficiencies in operation.
For example, because your work is more predictably scheduled throughout the year, you can plan labor and staff more accurately. Without the seasonal fluctuations that many businesses in the industry experience, you can attract the most qualified technicians. And you have the opportunity to purchase parts and materials at better prices and reduce excess inventory.
Service agreements are critical to success. With them, you can build a reliably profitable, well-staffed business that runs like a clock (and is attractive to potential buyers). Without them, it’s hard to ever establish the steady income stream needed for year-to-year stability.
Service programs also provide built-in resistance to shifting economic conditions. Besides contracted work throughout the year, customers may prefer to invest in maintaining existing plumbing and heating equipment during a slow economy in order to defer large capital expenditures.
Maintenance agreements are an opportunity for major growth and also a valuable service for customers, who understand that their equipment is complex and requires adjustments and fine-tuning to operate properly. Helping them get the most out of their machinery is mutually beneficial, but it takes the right tools — like service software designed specifically for home service contractors.
Alok Chanani is CEO/co-founder of BuildOps, a centralized platform that empowers commercial contractors to optimize their projects.
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