How to Profit From Maintenance Agreements | The Ultimate Guide
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Maintenance agreements (or “maintenance contracts”) are a proven revenue generator for home service professionals. These agreements provide homeowners peace of mind while also guaranteeing future, billable work for home services businesses in a market that's hard to predict.
Is your home service business properly utilizing maintenance agreements? Could you be selling more of them? Does your team know the best time to pitch them to homeowners?
Below, we take a closer look at best maintenance agreement best practices and what modern field service companies can do to revamp their efforts and take advantage of these profitable contracts.
Why Maintenance Agreements Are So Important
As a business owner, you already know that there are busy times when the phone seems to be ringing off the hook and other periods when jobs are scarce. In some industries, like HVAC and plumbing, these peaks and lulls change with the season but every business must weather slow periods where revenue can dwindle.
Maintenance agreements can help stabilize revenue during these slow periods. By scheduling routine maintenance and checking in on existing customers, you can maintain a stream of billable, preventative services even when you don't have homeowners calling you with an urgent issue. Your team is also likely to catch issues that homeowners are going to want to take care of now—before they become a larger (and more expensive) problem in the future.
Maintenance agreements mean your company is obligated to stay vigilant to your customers' needs and that kind of attentive care gives you more opportunities to impress, service, and satisfy homeowners.
Train your team to engage with customers and listen to their questions and concerns during scheduled check-ups and maintenance. Facetime with customers is extremely valuable and maintenance agreements generate more of these opportunities to build a rapport with homeowners and inspire loyalty to your brand.
Writing Your Own Maintenance Agreements
Whether you are looking to revamp your current maintenance agreements or are introducing them to your customer base for the very first time, there are specific principles you will want to be mindful of to ensure that these offerings will be mutually beneficial to both you and your customers.
When writing or revising maintenance agreements for your company
Charge the right price
. This will vary based on your market, your competitors, and the specifics of your own business. Bottomline—you want to crunch enough of your own numbers to make sure that these agreements are profitable for your business and don't end up being costly or wasteful.
Set the right term
. Many maintenance agreements are for 12 months--others are on a month-by-month basis (read more about renewal policies below). You want to find a term policy that is appealing to homeowners who are willing to try a contract out but don't want a major commitment.
Determine a renewal policy
. If you opt for an automatic renewal policy, you want to make that clear to homeowners as they sign up. You should also establish some sort of notification system so that, weeks before the renewal kicks in, homeowners are reminded via call or email that their renewal is coming. Transparency can help build trust with customers—and modern consumers expect it.
Do your diligence
Maintenance agreements shouldn't be extended to homeowners until your team has detailed information about their equipment and property. If there has been new equipment installed on the property, make sure your maintenance agreement is attached to that specific unit (via its serial number). Generally speaking, you want to be aware of the working condition of a homeowner's HVAC technology, plumbing, etc. before extending them a maintenance contract. Too many visits to remedy issues means that the contract will become costly for your company. Prepping Your Team
Your techs will bear most of the burden of pitching and selling maintenance agreements to your customers. Many technicians entered the trades because they enjoy working with their hands and helping people—not because they wanted to be salespeople. However, there are ways to help your team approach this process with confidence.
For instance, you want to keep your pitch simple and short. Neither your customers or your techs want to be burdened with a sweaty, prolonged sales situation, so make sure your team knows how to speak about your maintenance agreements in a succinct way that highlights homeowner benefits.
You also want your team to identify the ideal opportunities to pitch your maintenance agreement. Not every house call is an opportunity to pitch a maintenance agreement, but techs should be aware of situations where they could be compelling to homeowners. For instance, if your company offers free inspections on initial visits, these inspections can be useful in finding current (or potential) issues the homeowner may not be aware of and may want to remedy with a maintenance contract.
If you're using an intuitive, cloud-based tablet app out in the field like ServiceTitan Mobile 2.0, you can even make maintenance agreement forms a mandatory part of certain job cycles, ensuring that your techs always know when the time is right to pitch a contract to a homeowner.
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