How To Sell Recurring Service Agreements
The maintenance agreements have actually become an integral part of the business workflow of home service industries, we have 3 main categories of people who will be benefitting from it.
- The company
- The employees
- The customers
So before getting on to how recurring service agreements can be sold out to your customers,
Let us have a brief understanding of “what are recurring service agreements ?”, “How it is useful for the company”
What are recurring service agreements?
Recurring Services Agreement means an agreement with a New Customer for the provision of services on a continuing basis. It can be monthly or yearly basis, which typically varies from business to business.
How it benefits the company
- Service agreements are the means to keep the business up and running during the periods when the demand/requirement for services is quite low. It helps bring in the money during the seasonal lulls. The service agreements are mostly prepaid and it is a contract made on a monthly or yearly basis.
- It helps in building on the trust of the customer on our service. It helps in building customer relationships The maintenance agreements are generally sold at a discounted price, so if a customer would have called for a service that does not fall under a service agreement it would have cost him more. One more point which is worth keeping in mind is that the preventative work is done consistently on a regular basis, so customers can actually avoid a sudden emergency expense and with the HVAC, electrical and plumbing unit running efficiently, it will help them cut down on utility expenses too.
- The service agreements also help in retaining the employees. The employees who do not have work during the seasonal lulls have the tendency to jump from one company to another. Service agreements are the means which provide a sense of stability as they are tied up to some kind of work even during the seasonal lulls. It creates a win-win situation for both the company and the employees.
How to sell out recurring service agreements
I. You need to understand the timing of when to pitch to your customers about the service agreements, basically understanding the customer mindset is the key to it. The customer should not feel that you are just trying to draw money out of his pocket. The right time to pitch the service agreement would be when the customer is getting installation or service done as that would be the point when he would be actually understanding the importance of proper maintenance. Every customer is different, their requirements are different so telling them the benefits in a way that you create a sense of need or create a scenario of what future problems might arise will help close the deal. It’s basically a sales pitch so training your technicians on how to talk to them is going to be critical. They are the ones who will be on the field in direct contact with the customers.
Now How to pitch it is quite important, you must not bug down the customer with all the technical details. Putting forward the important details and explaining “what is in it for the customer” is the right way.
Stressing on both monetary and maintenance benefits. For example -Offering discounts which will basically depend on the extent up to which you can play on profit margins, based on which you can make the decision on what would be the optimum discount percentage you can offer and when you do this, mention the amount which they will be saving. This will increase the chances of swaying the customers into your direction.
To sell out recurring service agreements, it is important to track down all the customers who fall in the list of service agreement customers and nurture them using emails/message or build a connection with them on social media accounts throughout the year and not suddenly start contacting them just at the point when the agreement is going to terminate. The customers are pretty intelligent and with a plethora of good options available in front of them, it won’t take them much time to discontinue the agreement in case of people who are in-contract paying on monthly basis. In order to make them loyal to your brand or company, you got to earn their trust. The service agreement should be a way to show the customer that you are the best company offering the best services and this is how you take one step forward towards a long-lasting relationship with the customer. It will happen only through regular touchpoints not just on the field but even online, which can be done by providing valuable information about general utilities (HVAC, electrical, or plumbing ). For example – What are the simple things that the customers can do to keep the units working efficiently.
Let’s have a quick look at the increase in service agreements that Andgar Mechanical LLC made after they started using Smartserv software
Andgar corporation is into different businesses and one of them is HVAC and plumbing, It started out in 1973. It is one of the top-rated HVAC company in Northwest Washington.
Smartserv is a field enablement software which will help in keeping the schedule organized, the invoice synced with Quickbooks and it has many more useful features which eventually helped Andgar manage their business workflow in a better manner.
Andgar started using the Smartserv CRM platform from mid of 2015 and they have made significant progress over the years, especially in terms of service agreements. There has been a 6X increase in service agreements.
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