[Editor's note: Welcome to the ninth installment of "Money Talks." Each month, Terry Nicholson, president of AirTime 500, will be providing business management information, all with the aim of helping contractors, as he put it, "make money every day."]

Here is a quick profitability puzzle for you. Which of the following scenarios means more to your company?

Scenario No. 1: A homeowner calls you from the Yellow Pages. You run a service call to the home, generating a large amount of revenue. However, the homeowner never calls you again.

Scenario No. 2: Another homeowner calls you from the Yellow Pages. You run a service call for

the owner and fix a minor problem. The resulting revenue is way below your average, but the good news is that the homeowner calls you again. In fact, the customer continues to call you whenever there's a problem. You develop a relationship, and you eventually wind up replacing the system.

Obviously, the second scenario will mean more to your company's well-being in the long run. The first option might boost your numbers for the moment, but it is the continued service that leads to sustained income and growth.

With that in mind, how do you go about turning the first scenario into the second scenario? What's the secret to turning a one-time customer into a lifelong client?

How To Create A Client

Here are three ways to bring in, create, and keep clients.

1. Provide unparalleled service. First off, you must provide that first-time customer with the service experience of their lives. Give them a reason to call you again. The secret to outstanding service is going above and beyond expectations.

What can you do to exceed expectations? Do you wear shoe covers to protect your client's home from wear and tear? Let your clients know why you're doing it. Explain that you're looking out for their home from the get-go.

What else can you do? Do you give your customers options for their system, such as to repair or replace? Compliment your customers, explain the problem and the solutions, and then clean up when you are done.

You can even leave a small gift, like a box of chocolates, with your first-time customers.

All of those are elements of an above-and-beyond service experience that will compel your customers to call you again.

2. Stay in touch. The second element of creating a client is keeping your name and identity on the forefront of their minds. Too often, contractors forget to stay in touch with their existing clients as the marketing budget gets pushed into the Yellow Pages and direct mail for new customers. But don't forget about the people that got you where you are today.

Constant communication is a pillar of client retention. Make it easy for your clients to call you again. Use promotional items to keep your name and phone number in front of them.

Communicate with your current clients - be it by e-mail, a newsletter, or a letter - once a month to stay in touch with them. Offer an open house or start a preferred client discount club.

The list of ideas for client retention is practically endless. Stay in touch with your customers and build a relationship that creates a client.

3. Reach an agreement. The most powerful element of creating clients is getting your customers to join you. In our organization, AirTime 500, we have a program called a club membership. It's a powerful tool that ties clients to you and creates a constant stream of revenue without accounting or renewal headaches.

If you want to create a client, though, without the use of a club membership, another way is with some form of maintenance agreement. These agreements, depending on the ones you use, can create cash flow for you and make your customers feel like part of an exclusive club. Once your clients are "part of the club," chances are good that they'll stick with you through the years if they renew their agreement.

These agreements also tend to benefit you in terms of work by providing you with opportunities to perform inspections. You can schedule these annual inspections for times when you might be slow and your team needs some work.

Repeating Is Good

All in all, these three strategies will help you turn one-time customers into repeat clients. Doing so will provide you with more benefits than you may realize.

You'll create revenue through continued service calls. You'll have the opportunity to replace their system in the future, which will mean even more revenue. And, if you've provided continual above-and-beyond service, that client may refer their family and friends, giving you the opportunity to create even more clients.

Go to work creating clients, and you'll be creating success along with it.

Next installment: Where does your profitability and success start and end? Is it with your ability to market? Is it with the equipment you offer and the name on it? No, everything in your business starts with your people, and your ability to recruit the right team will determine your success.

Nicholson is president of AirTime 500. For more information on AirTime 500, call 800-505-8885. Nicholson can be reached by e-mail at tnicholson@venvestinc.com.

Publication date: 09/06/2004