The answer is simple: maintenance agreements.
The answer is so simple that I am continuously amazed at how many contractors do not emphasize and sell maintenance agreements.
There are a number of valuable reasons for offering maintenance agreements. This spring, maintenance agreements provided the majority of our service work much later into the spring and early summer than normal.
The BenefitsThe first benefit to selling maintenance agreements is that it provides work for your service technicians in the in-between fall and spring seasons. Maintenance agreements keep your service technicians busy in slow times. Do the math. We anticipate that a technician can perform four or five maintenance calls in a day, leaving time for two or three emergency service calls.
In our area, we typically start performing the calls in mid-March and hope to be pretty well completed by the end of May. We go through the same process in the fall, starting early in September with a mid- to late-November anticipated completion date. That means we have roughly 11 weeks, or 55 work days, in the spring and the fall to complete the agreements. Therefore, with approximately 250 maintenance agreements, we can keep one service technician busy for the most difficult 22 weeks of the year.
Second — and nearly as important — is the fact that when a customer has a maintenance agreement with your company, he feels that you are his heating and air conditioning contractor. That is, when it comes to heating and air conditioning and related needs, the customer will call you because you are the one he thinks about when it comes to his heating and air conditioning systems.
Third, if you sell maintenance agreements properly, at least a year at a time, you improve your cash flow by bringing in the cash for two calls in advance of the time the work is performed, or at least at the time you perform the first call.
Fourth (and very important feature for the customer) is the fact that furnaces and air conditioners will provide more efficient service over a longer life when they are properly maintained.
Sales TipsIs there a secret to selling maintenance agreements? Not really, but there are some techniques that we have found to be successful.
One is to meet with your service technicians and educate them as to the advantages of maintenance agreements, especially the advantages for the customer. If a service technician is “sold” on the advantages, then it is a relatively simple matter for him to explain the advantages to the customer.
We offer a perk (in our case, $10) to the service technicians for each agreement they sell. Additionally, we offer the same perk to our office personnel who take the call if they are able to “pre-sell” the agreement. It actually provides a little friendly competition between the office and service techs.
In addition to the advantages to the homeowner, you can explain to the service technicians that if they can sell just one maintenance agreement per day, for a year — about 250 total — they will have provided work for themselves in the “off season.” And, just as important, they will have sold that customer on the fact that they are the service technician that the customer wants as his heating and air conditioning expert.
We have found that with the busy schedules most people have today that trying to call them to arrange for the maintenance calls just doesn’t work. Instead, we send out a postcard reminding them of their agreement and asking them to call our service department to set up the appointment. We have found this to be a much more effective way of contacting them.
The other important process that needs to occur is to automatically send each maintenance customer a renewal notice/invoice. The majority of your customers, if you have done a good job for them, will just routinely send in their renewal check.
Guest columnist Butch Welsch operates Welsch Heating & Cooling in St. Louis. He can be reached by e-mail at Welsch1@primary.net.
Publication date: 07/14/2003