Toolboxplaybook-back-btn Playbookplaybook-back-btn Chapter 13

CHAPTER 13

Management and Office Best Practices

The day-to-day visibility into KPIs on the ServiceTitan dashboard puts trade company managers in position to recognize and act on business trends. Setting alerts, building custom reports and automated delivery of information to key stakeholders supercharge what you know.

SECTION 5 OF 6

KPIs at a Glance

Average Ticket

Average Ticket is a great KPI because it shows how each team member is performing with the job opportunities given.  By focusing on this KPI, ServiceTitan customers on average will increase their average ticket by 6 percent year over year (and significantly more the first year they are on ServiceTitan). 

LISTEN NOW: Rachel Stepowoy on six ways to increase average ticket.

Even using an average of 6 percent could make a significant difference in the business.   Christopher Reed, with The Heat & Air Guy in Newcastle, Okla., saw his team's average ticket increase by $100 in the first month of using ServiceTitan.   

How do we improve average ticket?

The benefit of tracking the average ticket is it uncovers other opportunities in your business that should be improved. There are four areas you need to address in order to raise your average ticket:

  1. Start Measuring & Set Targets

  2. Analyze and Correct Your Pricing

  3. Put Systems In Place

    1. Dispatch for Profits, sending the right tech to the right call, and dispatching based on opportunity. 

    2. Service/Sales Call Process: Steps to the call, using complete inspections, offering options, closing.  

  4. Training: Train diligently on the systems above.

Pricing, training and process issues are the most common things that affect average ticket size. For instance, low average ticket could be solved by more training for the technicians, presenting multiple options, utilizing financing, using the complete inspection process to uncover needs, etc.  

It could also lead to dispatching training, focused on sending the right tech to the right job.  Doing so has proven to increase the average ticket for numerous contractors.  

Measuring average ticket also helps technicians understand the expectation. Most are competitive and want to exceed the bar. Average ticket size provides instant feedback into their individual performance, creating a culture of performance instead of a culture of tenure

How Do We Start?

Set up to measure: The first thing we need to do is make sure everything is set up in the account and we define how we are going to measure it.  

Tracking Average Ticket Correctly: ServiceTitan provides multiple metric options for average ticket depending on your view of the number.  Most best practice companies track technician performance with the “Opportunity Job Average.”  

Opportunity Job Average will give you the average ticket of all your opportunity jobs (any jobs that are NOT marked as no-charge jobs, warranties or recalls). This is the preferred metric and the one that is highlighted in the company metrics section of ServiceTitan’s Updated Dashboard.  

Opportunity Job Average = [Sum of completed revenue from opportunity jobs / Count of opportunity jobs]

“Total Job Average” will give you the average ticket of all jobs including no charge jobs, warranties and recalls.  Tracking this at the business unit level helps managers understand the impact of the no charge, warranties and recalls to the overall ticket average.  Total Job Average = (Sum of completed revenue from all completed jobs / Count of all completed jobs)

For tracking opportunity job average it is very important that only jobs that are intended to be opportunities are reported that way. The best and most efficient way to ensure this is through the set up of your job types settings. Any job type can be made a “no-charge job by default” by clicking a checkbox within each job types setting. 

This is important to think about not only for single jobs but also multi-day projects that will by nature have $0 jobs that should not be factored into the Opportunity Job Average metric. Keep this in mind when creating job types you will use for your workflows.

» IMPORTANT: For accurate reporting, ensure ALL of your jobs types have a sold threshold of at least $.01 if no dispatch fee or $.01 more than the dispatch fee amount if one exists for the job type. A $0 invoice on a job with a $0 sold threshold will count as a conversion and therefore make the job an opportunity (even if it is marked no charge) and count the job towards this average.

WATCH NOW: Video on how to set up job types and confirm accuracy for job metrics

Read more now:

How do we monitor Opportunity Job Average?

Opportunity Job Average can be found on the updated ServiceTitan dashboard as well as the prebuilt “Revenue” report in the Business Unit Dashboard and Technician Dashboard sections. All of these metrics are located in ServiceTitan’s Business Unit Performance and Technician Performance report template for custom reports at the individual BU and individual technician level respectively

The most important part of this KPI is setting the target.  Many things go into what this target should be, and each company may have different KPIs. Geographic location, types of work performed and labor rates factor into this. 

Membership Closing Ratio

If a company is building a club membership program, tracking your membership conversion ratio is a critical KPI.  Technicians should maintain a minimum of 30 percent conversion ratio. If CSRs are allowed to sell memberships on incoming calls, some companies have converted more than 60 percent.    

Closing Percentage

Tracking Closing Percentage on all jobs is a very important KPI.  Monitoring it closely helps teams produce more sales.  

The Closing Percentage can vary greatly depending on the lead source.  For example, take the Closing Percentage for an HVAC comfort advisor and see how the different lead sources each have a measurable KPI.  

Sales closing ratios (on average)>50%
Technician lead75-85%
Current non-agreement customer55-65%
Service agreement customer70%
Self- generated65-80%
Marketing lead25-35%

By measuring this by lead source, technician/comfort advisor and geographic area, you can maximize your opportunities and use this data to your advantage to produce more sales.  Likewise, this KPI will also help you identify coaching and improvement opportunities for individual team members, product offerings and pricing.  

Labor as a Percentage of Revenue

This is a critical KPI to determine the efficiency and effectiveness of individual departments.  By monitoring this KPI and having a target, it’s possible to identify whether the problem is efficiency, performance or pricing.    

Call Booking Percentage

As CSRs answer incoming calls, some calls are identified as lead opportunities, and others are not. Of the calls that are actual opportunities, contractors will want to know what percentage of those lead opportunities are actually booked. 

By tracking and understanding this KPI, contractors can determine how effectively their CSRs are capturing leads and booking calls. A best practice is to listen to the calls that are not booked and identify why the call was not booked. 

To improve your call booking percentage, give CSRs additional training, coaching and information to increase their ability to book more of these lead opportunities.

READ MORE: Chris Yano on tracking leads

Lead Turnover Percentage

Those in the HVAC business know how valuable a lead turnover can be. For most companies, one HVAC system install produces the same gross profit as a whole week of service work. The Lead Turnover Percentage KPI monitors who is performing well and allows contractors to be strategic about sending those technicians to the calls with the older units and higher probability of needing a system replacement.

Companies that use this KPI well also establish a solid definition of a qualified lead. That involves determining the target age of a system is for replacement, and what dollar amount, if exceeded, makes sense to offer a replacement option. 

Failure to define what a qualified lead is could result in high lead turnover percentage but low sales closing percentage—and decreased customer sentiment.

Go to Section 6: Debt Financing