Expert Advice: How to Run a Successful Home Service Business in 2023

When you manage a service business, reaching company goals often entails overcoming significant challenges and uncertainties because of marketplace changes or other unforeseen circumstances. To achieve that, service business owners need excellent communication skills, efficient workflows, an effective marketing plan, and a reliable tracking system to measure important metrics (such as lead conversions and ad campaign performance).

Service businesses offer services, expertise, or labor (such as accountancy services, car repairs, and cleaning services) to their customers, rather than a physical product. They loosely fall into three categories:

• Home services (such as HVAC, plumbers, and electricians)

• Professional services (such as marketing agencies, lawyers, and financial advisors)

• Personal/healthcare services (such as hairdressers, dentists, and chiropractors)

We’ll be focusing exclusively on home services in this article, but our advice will help you run any type of service-based business so that it brings you profit year after year.

With over a decade of experience helping home service providers streamline and grow their operations, we reached out to some of our customers to ask what advice they thought every home service business owner should know to ensure profitability and growth.

Their guidance spans four key areas:

1. Create an effective marketing strategy: Identify your target audience and use a variety of marketing channels to attract new customers and retain current ones.

2. Deliver outstanding customer service: Exceed expectations, build relationships, get more online reviews, and foster word-of-mouth referrals. 

3. Streamline your business processes: Use modern software to eliminate paperwork so your techs can focus on delivering outstanding service.

4. Track growth: Know how money flows in and out of your business, track productivity, job profitability, and other important data metrics (such as cash flow).

In this post, we’ll discuss each area, explaining how our field service software, ServiceTitan, helps home service businesses (such as HVAC, electricians and plumbers) run their businesses more efficiently and profitably. 

Before we dive into our advice, we’ll provide a brief overview on how to set up a new business for success. 

How to Start a Service Business

Whether you’re an entrepreneur with a business idea, a startup, or a small-business owner, setting up and running your own business means you need to master four management concepts:

• Planning

• Organizing

• Leading

• Controlling

Planning

Planning your service business carefully is critical for growth so you have a solid foundation to build on and a roadmap to follow. 

“You’ve got to act like the business you want to become,” says Tommy Mello, The Home Service Expert.

“Create a budget. Create a business plan,” says Dawn Wasicek, the former ServiceTitan administrator at McCullough Heating & Air Conditioning in Austin, Texas. “Create an implementation plan to support your business plan.”

To create your business plan:

• Do market research so you can define your type of business 

• Identify your target market

• Describe your specific business services

• Analyze market trends

• Know your competitors

• Choose a business name

• Select your business structure (e.g. sole proprietorship or limited liability company)

• Set your pricing strategies

• Devise an organizational chart 

• Include financial projections

• Set a budget for marketing (usually 10–20% of revenue)

Identifying your startup costs will vary, depending on your specific service business needs. 

Expenses to consider may include:

• Equipment (purchase, maintenance, and repair)

• Business licenses

• Rent for office space

• Office supplies

• Insurance policies (business insurance, liability insurance)

• Legal services

• Vehicle (purchase, maintenance, repair, and fuel)

• Labor costs

• Software tools and digital devices

You will also need to set up a business bank account, obtain company credit cards, purchase a domain name for your website, and consider having business cards printed.

Your business plan is a working document that you should revisit on a regular basis. Review it two to four times a year and adjust it as your company grows. You can use it to track goals and set new ones, ideally making sure your decisions are informed by data. 

Organizing

Organizing your service business so that it operates like a well-oiled machine means having all your business processes operating smoothly with minimal intervention from the business owner. 

For a home services business this means:

• Providing your staff with the right tools and materials for every job

• Scheduling and dispatching jobs (including monitoring costings) from start to finish

• Offering a flat-rate pricing system to reduce bookkeeping errors and help techs upsell services to grow ticket sizes

• Automating invoicing to speed up payments, improve cash flow, and satisfy customers

• Paying your home services staff promptly and correctly

“Look at McDonald’s or KFC, they open a new store every four to six hours," says Mello.  “It’s this master plan to go in and everything’s the same, there’s a system and checks and balances around every single aspect. That’s how they create success.”

ServiceTitan has several features to help you organize your home service business processes. These features include call booking, scheduling, dispatching, and super-efficient invoicing and payroll features — as we'll discuss below. 

Leading

Our third important management function, leading, may be the most important thing you do to drive success for your home service business.

Chris Hunter, ServiceTitan’s Director of Customer Relations, explains the importance of working on your business, instead of in it. 

Instead of jumping each time a customer called, Hunter followed the advice of his mentors, who told him to choose between control or growth, because you can't have both. 

“That really hit home with me, because I wanted to control things. I wanted to control the outcome," Hunter says. “But if we want to go up, we're going to have to learn how to give up that control for growth. It's no longer about you being No. 1, it's about coaching other people to be No. 1.”

You also need to give up going fast for going far. It may be easier and quicker to do a job yourself, rather than training someone new, but coaching and training everyone on the team to perform at a higher level pays off in the long run. 

“If you want to go fast, you go alone. But if you want to go far, you need to build a team — you need to bring a team with you,” Hunter says.

Eddie McFarlane, Vice President of Learning and Development at Haller Enterprises, a 400-employee, multi-trade service company in Pennsylvania, says true leaders inspire their techs, CSRs, sales staff, and managers to perform at a higher level. Like honey attracts bees, company success invites even more success and gives you a competitive advantage.

“Essential leadership — it's just the ability to transparently share and communicate your values, and then allowing others to join in that vision you've shared, and developing the muscle memory for these skills,” says McFarlane, a former service technician.

The ServiceTitan Playbook is a useful resource to learn how to set up your company culture and inspire leadership.

You can also learn more about effective leadership from these ServiceTitan resources:

• How to drive extraordinary success and retain techs by leading well

• Leading with humanity can transform your company 

• Spread leadership through your organization

• Why these 7 trade industry leaders love ServiceTitan

Controlling

The fourth service business management function allows you to control what matters most — your key performance indicators (KPIs).

This means putting the proper controls in place to measure the performance of your business. Planning, organizing, and leading your business are important, but if you don’t have meaningful data and the ability to analyze that data, you won’t know what actions to take to adjust activities to increase profit.

Assess where your company succeeds and where there’s room for improvement by monitoring the following key metrics:

• Sales revenue

• Gross margin

• Monthly profit/loss

• Service metrics

• Customer retention

• Advertising ROI

ServiceTitan’s software is a useful tool that allows you to track specific KPIs (on every job, technician, CSR, and marketing campaign), in real-time, so you can take measures to grow your business. We’ll discuss these features in detail below. 

Running a successful service business relies on having a solid business structure in place. 

Assuming that you already do, or that you’re working on your business model to create a strong foundation, let’s walk through the four key areas our valued customers recommend you focus on to achieve growth:

1. Execute an Effective Marketing Strategy

Creating a marketing strategy that attracts new business is another basic requirement for a successful service business.

Ismael Valdez took a blended HVAC-plumbing business in Southern California, NexGen Air Conditioning, Heating & Plumbing, from zero profitability to $30 million in four years by keeping it simple.

“We didn’t overcomplicate anything,” says the NexGen Air CEO. “And we focused on marketing. It’s the most important thing.”

“You can have the vans, the financials, the people, the processes — you can have all of that,” he adds. “But, if you don’t know how to make the phone ring, nothing else matters.”

There are a lot of moving parts to consider when creating and implementing an effective marketing plan. 

Here are a few marketing activities to consider for your home service business:

• Optimize your home service business website for SEO

• Promote your Google Business Profile page

• Invest in Google Local Services Ads

• Ask your customers for Google reviews

• Run email marketing campaigns

• Deliver direct mail to your potential customers

Optimize Your Website for SEO

Most potential customers use the internet to search for local home service businesses based on what they need. 

For example, they’ll type in the words, “plumbers near me,” and look for the plumbing businesses with good reviews. Google’s algorithm searches for the results most relevant to those keywords and closest to the location of the online searcher. So, to appear on Page 1 of Google’s search results, consider location when choosing the keywords people may use to find your services online.

If you’re a plumbing company in Charlotte, for instance, be sure to use “Charlotte toilet repair” as one of your main key phrases. Sprinkle variations of the keywords on your website’s landing pages, content marketing blogs, headlines, subheads, meta tags, and meta descriptions to improve the SEO health of your website. Then, when potential customers do a local search for a plumber, your business stands a good chance of coming up on top.

Promote Your Google Business Profile Page

Attract new customers by verifying your Google Business Profile page. It’s simple and completely free. This will help your service business appear on Page 1 of organic Google search results.

Businesses can also buy Pay-Per-Click digital ads for better visibility, as well as set up call tracking to measure ROI.

Invest in Google Local Services Ads

Investing in Google Local Services Ads puts your digital ads at the top of search results, above PPC ads and organic listings. Crafting a snapshot of your home service business that includes your business name, Google review rating, and years in business, will quickly determine whether your service business fits a potential customer’s needs. 

Costs for Google Local Services ads vary, but you only pay when a customer contacts your service business through the ad. This cuts down on time wasters who are just price-shopping.

ServiceTitan integrates with Google Local Services Ads so your customers can directly schedule online appointments with your company, and provides business owners with ROI metrics on every campaign.

If you qualify for the Google Guarantee, you are eligible to buy these ads, which can be the first thing potential customers see when they search.

Ask Customers for Google Reviews

Top reviews are key to attracting new customers online. One consumer review survey found 98% of consumers read online reviews for local businesses. Make it easy for satisfied customers to leave five-star reviews on your business, and respond appropriately and swiftly to negative reviews to encourage potential customers to choose your company over a competitor.

ServiceTitan’s software automatically sends survey requests to customers after a job has been completed. This makes it easy for customers to share their experience on an online review site (Google, Yelp, etc) while it’s still fresh in their mind.

Run Email Marketing Campaigns

Consider including email marketing in your marketing plan. Email marketing generates the highest return on investment for small businesses, and targeted email campaigns are considered one of the most effective marketing channels, earning $40 for every $1 spent.

ServiceTitan's Marketing Software allows your home service business to automate customized email campaigns, targeting specific customers and/or geographic areas. 

Using data already collected in ServiceTitan, you can target previous customers with a “We Miss You!” email campaign, follow up with existing customers on unsold estimates, or offer a discount to new homeowners who may be potential customers.

Sending targeted emails is simple. Choose from our range of email templates, adjust the text to fit your campaign, and deliver to your chosen audience. 

Targeted emails mean higher open rates and more calls coming in.

With ServiceTitan, you can also monitor the exact ROI for each campaign by tracking the email performance and the revenue attribution within the ServiceTitan dashboard (see #4).

Deliver Direct Mail to Customers

Some home service businesses use more traditional methods such as direct mail marketing to send out their messages. This means potential customers get to keep your postcard, similar to home service business cards, for future reference when they need it.

ServiceTitan has a library of postcards that service businesses can choose from to execute their direct mail campaigns. Setup is straightforward — choose your design, adjust the text, then print and mail your postcards to your chosen audience. 

Direct mail campaigns have a set cost per postcard, so you only pay for the number that you send. And, as with the email campaigns, you can track the results of each campaign so you can see exactly which ones are driving revenue.

Regardless of which marketing methods you choose, a solid marketing strategy should be part of your business plan, not an afterthought. The best marketing plans encompass a variety of methods and you should be able to track and analyze your marketing efforts so you know how to spend your marketing budget to gain the greatest return. 

2. Deliver Outstanding Customer Service

Customer referrals make or break a business, and become especially important when your business centers on being in customers’ homes.

“As always, customer satisfaction is key,” Danielle N. Kirkpatrick, Office Manager for Kirkpatrick Homes Inc. in Pulaski, Tenn., says. “Making sure each customer is satisfied and happy gives you the chance to obtain a customer for life.”

And each home you visit provides an opportunity to earn a loyal referral source for life. 

"Focus on helping every customer have their perfect home and experience with your company,” Brian Hortin, GM of Absolute Air in Utah, says. 

“That's the goal we start with for every meeting within our company, and it helps us ensure every decision we make is intent on doing what's right for the customer.”

“Why do we do a system diagnosis and not just a symptom diagnosis? Why do we review all our recommendations and allow the customer to decide what to do without pressure? Why do we wear booties, text them our picture and bio, call the day after for a Happy Call, and more? To ensure each customer's experience with us is as close to perfect as possible, and to ensure that their home is as close to perfect as possible.”

Successful home services businesses prioritize positive customer experiences and customer satisfaction. 

With ServiceTitan's Customer Experience Software, customer service begins as soon as the phone rings. Our call booking feature automatically shows the CSR if the caller is a new or existing customer and provides prompts so that all the necessary information is gathered. 

If the caller is an existing customer, all their information (such as personal details, job and technician history) can be accessed without keeping the customer waiting. ServiceTitan even provides property information (including age and size) so your CSRs can be on the ball from the outset. The CSR can also spot opportunities to upsell additional services such as equipment upgrades and service contracts, and avoid promoting services customers have already bought. 

With ServiceTitan, you can send customers automated job confirmations via text as well as map tracking information, so they know exactly where your company vehicle is, who is coming (including a photo of the tech), and when. You can also receive texts from customers when they have questions about a job or need to reschedule. 

Keeping your customers informed at every stage helps each job run smoothly and enhances customer satisfaction.

3. Streamline Your Business Processes

We discussed the importance of organizing your home service business to set it up for success above. ServiceTitan’s software has specific features to help you streamline your operational processes (such as scheduling and dispatching, billing, and payroll), while ServiceTitan Mobile gives your techs and staff the agility to work from any location.

Mobile App

"My No. 1 recommendation is to leverage your technology,” says Craig Elliott, Chief Optimist for Nice Home Services LLC in Lorton, Va. “You must take advantage of the power at our fingertips that has never existed before. With ServiceTitan, we can build on our technology stack to leverage time through software like never before. This is the time for unifying and leveraging technology, and taking your business to the next level."

The right technology allows home service companies to streamline processes and run more efficiently. 

ServiceTitan’s Mobile App makes it easy for your home service techs to offer customers services while out in the field. With a simple tap, click, or swipe, techs can build estimates with photos, manufacturer videos, and product information — allowing customers to make decisions on the spot. 

Home service techs have access to all of the customer information collected by CSRs (contact details, job histories, outstanding estimates, prior invoices, notes, and more), directly from their mobile tablet. 

Techs can take payments directly from customers by capturing checks and credit cards via the mobile tablet camera, or you can add a credit card swiper. This is convenient for customers and means you get paid faster. 

Using their mobile tablet, techs can also offer financing options in the field. You control which plans you offer and set the rules to suit your business, and ServiceTitan will automatically do the calculations so techs can close jobs more quickly. 

Modern Scheduling and Dispatching Software

“Take a look at the business you’re already paying for, receiving, and completing, and find ways to do it faster, better, and more accurately.” Tyson Freeman, GM of Lee's Air in Fresno, Calif., says. “Process optimizations will minimize costs and put more dollars to the bottom line. Optimizations implemented now save money today and every time you perform that task in the future.”

ServiceTitan's software simplifies scheduling with drag-and-drop functionality, allowing you to effortlessly organize when techs need to arrive at job sites. With ServiceTitan’s scheduling and dispatching tool, you can book jobs days, weeks, or even months in advance, which is especially useful for long or complicated jobs. 

You can use our custom tags to flag technical specs or even languages spoken to ensure the right contractor with the right skill set attends. ServiceTitan’s dispatching software tracks where all techs are at any given time as well as any real-time curve balls such as traffic delays. Your dispatch team can contact the individual technicians and customers via SMS so it’s easy to make sure everyone is aware of any last-minute changes such as lengthening a job, or rescheduling it altogether. 

Streamline Invoicing and Payroll

Invoicing customers and paying your staff promptly and correctly is critical for establishing a reputation for being reliable and trustworthy as well as for growing your home service business. This is where ServiceTitan excels.

Invoicing

Service businesses that don’t use modern software like ServiceTitan rely on office staff and techs pulling together all the information (e.g. hours worked, materials used, etc.), to create each invoice. This is laborious and time-consuming. 

With ServiceTitan’s free Invoice Generator Tool, invoices can be generated from the job location. Simply input the relevant information into a customized invoice template and send it to the customer then and there via text or email. This saves time and looks professional — you can even include imaging and branding. It also significantly reduces the likelihood of pricing errors and lost paperwork. 

Payroll

ServiceTitan’s payroll software has been designed to help you track staff via timesheets, so you can pay them quickly. 

Our timesheet software also helps you monitor the productivity of your service business by monitoring time spent on specific activities, such as driving and collecting materials, as well as time spent on actual work. All these are recorded in real-time, and overtime and bonuses can be configured easily, too. 

Staff can access their timesheets for sign-off, so there’s no need to drive into the head office each payroll period. Using these tools saves, on average, around 30–60 minutes for each employer, every month, helps the whole team, and makes your service business more agile. 

4. Track Growth

We’ve mentioned the importance of tracking your service business’s performance so you can fine tune activities and promote growth.

“Every business owner must review how their marketing is performing regularly,” Jeff Seale, Owner/President of Accurate Home Services in Glendora, Calif., says. “You have to know how many calls you are receiving from each marketing source, what percentage of those calls are converted to booked jobs, how many of those jobs are closed in the field, what revenue they generate, and ultimately your ROI.”

“ServiceTitan allows us to track each of our marketing sources with a unique phone number, so we can review all the above and more … right down to listening to every call. You can only make informed marketing decisions if you have this information. Otherwise, you're just guessing.”

ServiceTitan's cloud-based field reporting software allows you to track key metrics so you can monitor performance from any source. 

Create a marketing scorecard of all current campaigns, then tie all new customers to the specific marketing campaign that brought them to you. This means you can make informed decisions about boosting spend on campaigns with higher returns, and dropping channels with poor performance.

If your company uses call-tracking software, such as ServiceTitan Phones Pro, you can easily track the number of calls, booked appointments, sales, revenue, cost per lead, and ROI for each advertising source. Then you can review your marketing strategies regularly and adjust accordingly.

You can also use ServiceTitan’s dynamic dashboard to filter dozens of KPIs and track how your business is performing. Accurate data assessment performs a crucial function in your business planning and becomes a key component as you plan for company growth.

Ensure Your Service Business Stays Agile

The industry changes every day, and companies that don’t adapt risk being left behind.

“Home service company owners should always be looking ahead to ensure their business is profitable and growing. In particular, they should be mindful of approaching market disruptors for the industry,” Amanda Woodward, Copy Team Leader for VitalStorm in Rockwall, Texas, says. “Topics to research include, but are not limited to, voice search, 5G network, Amazon Home Services and the Internet of Things (IoT).”

“These digital changes impact the home service industry in a big way, but they don’t have to become disruptors in sales if company owners stay up to date on the latest news and best practices.”

Using ServiceTitan’s all-in-one software system provides the tools you need to maximize the efficiency of your home service business, and execute and track effective marketing campaigns that drive growth and deliver outstanding service to your customers.

Want to discover how ServiceTitan can help your home services business with your marketing strategy and other essential business operations? Book a free, personalized demo.

ServiceTitan remains committed to helping home service professionals grow through our blog, webinars, podcasts, free business tools, and field management software. Trusted by more than 100,000 contractors, ServiceTitan’s customers report exponential revenue growth year after year.