How to Run a Service Business in 2020 | 18 Tips from Experts
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Here we are in 2020, each one of us facing the same question: what do we want to achieve this year? As a home service business owner, you know that your aspirations for your company, both big and small, will face significant challenges and uncertainties—many of which only become more complex and nuanced as the marketplace changes.
At ServiceTitan, our mission is to help business owners, tradespeople, and contractors face these challenges with the confidence and capabilities that rival any other tech-enabled business in today’s market. In that spirit, we reached out to some of our valued partners and customers to hear what they thought was the one thing every home service business owner should do to make sure their business is profitable and growing in the new year.
Some of the most popular solutions for business growth included:
- Data tracking: know how money flows in and out of your business (and why)
- Customer nurturing: exceed expectations, build relationships, foster word-of-mouth
- Cost calculation: labor, materials, recruiting—be aware of what you’re spending
- Accountable marketing: measure success by ROI, not volume of calls
- Proactive execution: there’s no time like the present to better your business
Here’s what they had to say...
“Every business owner MUST review how their marketing is performing regularly. You have to know how many calls are you 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 did it 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.”
Jeff Seale Owner/President of Accurate Electrical, Plumbing, Heating and Air Services Los Angeles, CA
“There are so many things that a business owner must do to ensure a profitable year and to sustain growth. If I had to choose just one thing, I would say, focus on the foundation. Our foundation is definitely our customer base. More than 50% of our annual revenue comes from our Comfort Club members and the referrals they gift us with. We show our appreciation with referral rewards and discounts on new products.
Before ServiceTitan, we relied on customers to call and schedule their PMs and we missed a few. Now, our Comfort Club members never miss their maintenance calls and more happy members means more referral business. In short, customer service is key.”
Wayne Whittenburg GM of SMW Refrigeration and Heating Tempe, AZ
“I feel that it is important for every business owner to monitor their gross profit on all work being completed. Growth is great but if the margins aren’t good then growth can cripple a company because with growth comes an increase in operating expenses which can be very difficult to reduce depending on the size of the company.”
Nick Morena Finance Manager for Shanklin Heating and Air Conditioning Dalton, OH
“The single most important thing a business owner can do to add growth and track profitability is TRACK NUMBERS. Track them on a daily, monthly and quarterly basis. It is essential.”
Marisa Samuel Administration Manager for Adam Mechanical Havertown, PA
“The one thing every business owner should do is know their break-even price PER HOUR. This number is based not only on your cost of doing business but mainly on your Billable Hour Efficiency. We only generate revenue for our business when we turn a wrench. We do not get paid to drive to a job, pick up parts, train our techs, talk to customers, etc. You have to track that downtime and factor all that lost time into your selling price.
A well-run service company can run at 50 to 60% B.H.E. For a company that runs at 50% B.H.E. that means they have 1,040 lost man-hours per year per tech that they cannot bill for. If you are not priced right you can be losing money on every call.”
Tony Dunaway Owner of BEST Plumbing Service of Cincinnati Cincinnati, OH
"My number one recommendation is to leverage your technology. Must take advantage of the power at our fingertips that have never existed before. With ServiceTitan, we can build on our technology stack to leverage time through software like never before. Make sure you using a unified chat system to communicate with your team. Make sure you're in control of your company emails by using Google G suit technology. Share contacts, manage calendars, Share documents etc. Make sure your team has good quality high-speed tablets because that is the number one killer of profit; poor efficiency in my experience. Are you still running hardwired phones?
If you haven't leveraged cloud technology to free time energy and space from hardware and limited access its time! This is the time for unifying and leveraging technology and taking your business to the next level."
Craig Elliott Chief Optimist for Nice Home Services LLC Springfield, VA
“As always, customer satisfaction is always key. Making sure each customer is satisfied and happy gives you the chance to obtain a customer for life!
Aside from that, in this era of technology which is constantly changing, it is important to not only have a social media presence but also to keep it up to date and relevant. We have actually noticed our competitors using our social media tactics of highlighting employees and sharing our charitable contributions which is great because that just means more encouragement for their employees and a better outlook on their community.”
Danielle N. Kirkpatrick Office Manager for Kirkpatrick Homes, Inc. Pulaski, TN
“Get updated material and equipment quotes from vendors and update your sales and service pricing accordingly. Particularly with the additional tariff increases happening in January—it will affect our industry across the board.”
Kerry Kelley Owner of Nashoba Air & BoilerWorks Littleton, MA
"The one that we are focusing on is running our business using our core values. This year I will be relating them to the business decisions I make and communicating them with my team. I have the core values posted everywhere. I have even posted them in ServiceTitan’s content portal. Here is an example of how the choice of using ServiceTitan supports GEN3’s core values:
- The use of technology critical for GEN3 to continue to grow. ServiceTitan brings several different technologies together to help us grow by being more efficient.
- It is a joy to help customers, employees and other business owners. ServiceTitan allows me to help each group. I personally enjoy helping others in the ServiceTitan community
- The amount of information required to run a business today is challenging. ServiceTitan turns information into a business opportunity we use to attract talent and win customers.
- Being excellent every day is much easier because my team has the right tools. ServiceTitan gives everyone the information and enhances their ability to be excellent every day. The rest is just a choice."
William Lutz Owner of GEN3 Electric Philadelphia, PA
“Keep a pulse on your business by keeping open communication with your entire team. If you want to make changes to a department, ask for feedback from the people that do the job on a daily basis.
There is no such position as the low person on the totem pole. If the person has any contact with your customers then that person is capable of raising your company to great heights or pulling it down into the depths.”
Mary Crawford ST Specialist for Anthony Plumbing Heating & Cooling Lenexa, KS
Paralysis by analysis affects many well-meaning contractors. The secret to our success at Hunter Super Techs is learning from others who are successful and taking action! There really aren’t any secrets, it’s all in the application. The best advice I can give is to simply take action and make it happen. You miss 100% of the shots you don’t take, so might as well let them fly!
It’s go time!”
Chris Hunter Owner of Hunter Super Techs Oklahoma & Texas
"Focus on helping every customer to have their perfect home and experience with your company. That's the goal we start every meeting within our company, and it helps us ensure that 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 that 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.
Brian Hortin GM of Absolute Air Heat & Water Mapleton, UT
“Create a budget. Create a business plan. Create an implementation plan to support your business plan.”
Dawn Wasicek Inside Sales for McCullough Heating & Air Conditioning, Inc. Austin, TX
“The one thing I believe a business owner should do to make sure their business is profitable and growing in the New Year is have the right leadership in place. Without a leadership team to execute and drive your people to exceed your goals, you miss out on the potential to maximize your growth.
Every great business has an outstanding leader, and many employees would agree that they leave their jobs because of poor management—not the workload in front of them. Being able to motivate your employees to reach their full potential can unlock some great business achievements. Your leadership team sets the standard for excellence, work ethic and the culture that your business needs to thrive on.”
Karen Hawkins Project Manager and Logistics Specialist for American Mechanical, Inc. Virginia Beach, VA
"Process optimization. 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. 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."
Tyson Freeman GM of Lee's Air Conditioning Heating & Building Performance Fresno, CA
“Find and pay for the right person to run office operations. Empower them to steer the ship.”
Laura Diamond GM of William C Diamond Plumbing East Hanover, NJ
“Home service company owners should always be looking ahead to ensure that their business is profitable and growing. In particular, they should be mindful of approaching market disruptors for the industry. 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. For example, company owners can combat the potential disruptors of voice search by strengthening their top of mind awareness among their customer base through the use of social media marketing. Check out our eBook, Social Media Marketing for Home Service Companies, to learn some tips and tricks that can aid you on this front.”=
Amanda Woodward Copy Team Leader for VitalStorm Rockwall, TX
Prioritize quality conversations with customers to improve the customer experience. Home service businesses are in a unique position to interact with customers on a human-to-human level at every customer touch point. If executed poorly, these conversations can severely damage a business’s reputation.
There are 3 important elements to consider when having conversations with your customers:
Timeliness: Can customers start a conversation with you when they want to start the conversation? Let’s face it… no one wants to be put on hold, and no one likes waiting to hear from your business “later".
Your business can have conversations with customers in a timelier manner by training CSRs to talk to customers more promptly, and to put customers on hold the right way (yes, there is a right way… but that’s an article for another day). You can also utilize automate web chat services so that customers don’t have to fill out a form and wait… automated web chat helps businesses start the conversation the second a visitor lands on your website, and they convert a higher percentage of leads than forms do.
Trustworthiness: can a customer trust that you know what you are doing, and that you understand what they are experiencing? Trust is earned and there are two simple things you can do to be more trustworthy in your conversations:
- Ask the customer questions like “tell me more” to invite them to explain their situation, and then rephrase what they say in your own words.
- When the customer knows you understand, reassure them you can help with phrases like “we can definitely help you out.”
Emotional connection: In addition to trust, an emotional connection can build relationships and a reputation of excellence like few other things in your business. Show genuine empathy and respect for customers, appreciate their perspective, and make sure they know in your words and your tone that you are truly grateful they called.
The fact of the matter is this: you are very similar to your competitors in many respects. You need a differentiator to make your business stand out, and that differentiator is the customer experience you create in conversations with your customers.
Zac Garside Marketing Manager for Power Selling Pros South Jordan, UT
ServiceTitan is a comprehensive software solution built specifically to help home service companies streamline their operations, boost revenue, and substantially elevate the trajectory of their business. Our comprehensive, cloud-based platform is used by thousands of electrical, HVAC, plumbing, garage door, and chimney sweep shops across the country—and has increased their revenue by an average of 25% in just their first year with us.Learn More