Contractor Magazine September 2010 - Running a service business is challenging. If only the customer understood just how much work and how many people are involved in a single service call. As a plumbing/HVAC company, we incur many costs just getting our technician and truck out there, ready and able to complete a job.
To best illustrate our point of what it takes to run a service business, let’s use the analogy of a doctor. Without years of training, it should not be possible for a doctor to make a diagnosis and prescribe a remedy. Consider for a moment that it isn’t just his initial training, but an ongoing variety of continuing study and the expense of maintaining an adequately equipped staff and office.As a patient, you pay for his knowledge and skills as well as a share of his business costs (overhead). Even if he spends only a few minutes, his fee may range from $50 to $150, depending upon his degree of expertise.
A qualified service organization’s costs begin with the salary of the professional. The amount is the same whether the professional is actually making repairs, traveling to keep service appointments or participating in training programs to sharpen his skills.
The cost of doing business must also be added to the professional’s salary. These overhead costs can amount to substantially more than the professional’s salary. Now comes profit. If your service charge is $200 and you are efficient enough to earn 15% of the $200, then you earn 30 taxable dollars. Now, this is not excessive for providing top quality services on the customer’s premises. But, you can’t tell the customer this.
The customer doesn’t need or want to know what it takes to run your business. The only thing they need to know is that you will provide them with the service they desire at what they believe to be an affordable cost in a timely manner. In order to retain that customer and possibly even get referrals, you must do much more. The customer must be your No. 1 priority when running your business, and you must demonstrate this to them.
There are several ways to obtain this objective:
Add value to the relationship. Give your customers more than they expect. As an example, we utlize e-mail marketing to provide our customers with timely tips on a variety of subjects. If we’ve experienced a period of heavy rains, we send out an e-mail with tips on what to do if the basement floods. We give our customers tools such as an “Ask an Expert” section on our website where they can post a question and receive an answer the same day. We also provide expert information on our website, such as directions on how to unclog a drain and avoid a service call. By sharing our knowledge, we add value to the relationship and build trust.
Customer service is about serving the customer well. There’s nothing more frustrating to a customer than the inability to speak to a representative at a service company. More service companies have lost sales due to callers getting stuck in an automated voicemail loop. A service company should have at least one customer service rep answering incoming calls. That being said, the customer service rep should answer the phone with a smile. Customers can hear that smile in a rep’s voice and will respond to it.
Empathize with your customer. We can’t stress this point enough. When a customer calls us, we gauge how he is feeling as soon as we pick up the phone by asking the question, “How can we help you today?” This helps to diffuse that customer who is in a panic over sewer back-up in his house. It enables him to get straight to the point so we can react with an appropriate and immediate response to his emergency situation.
Put your customers at ease. We do all that we can to ensure that our customers are comfortable with us. We even send an e-mail alert to each customer prior to his/her appointment that includes an introduction and a photo of the service technician. Then our technicians show up at the customer’s home in uniform with an identify- ing badge and booties on their shoes to protect the customer’s home.
Go the distance to ensure customer satisfaction. After a service call, we make a follow-up telephone call to our customer to ensure 100% satisfaction. If for some reason they are not satisfied, we work to make it right immediately. Simply taking this extra step to find out if your customer is satisfied goes a long way towards retaining that customer. And they are less likely to express their dissatisfaction to others in person or online on sites such as Yelp, Ripoff Report and others. It’s not enough to deliver service as promised, on time and within budget. It’s imperative that you keep your customers your No. 1 priority when running your business. Do so, and your customers will know it and reward you with repeat business and referrals.
Tim Flynn is president of Winters Company Plumbing, Heating & Cooling, Cambridge, Mass. His company specializes in plumbing and HVAC as well as kitchen and bath remodeling. Contact Time Flynn at 617/484-2121, or visit: www.wintershomeservices.com.
Article courtesy of September 2010 Issue of Contractor Magazine.