4 Questions to Start Your Spring – The Answers Might Surprise You
February and March. These can be “bad words” in our industry. We generally celebrate when either one, or both, of these months are over. Take this slower time to get ready for a strong spring and summer season. When April/May hits, it’s probably too late to get started.
What would make this spring different than those in the past?
First, know where you are starting:
- How many maintenance plans do you have?
- What is your renewal rate?
- How many new maintenance clients do you enroll as a percentage of the non-maintenance customers you visit?
- How many replacement leads do you get from maintenance and non-maintenance customers?
Let’s answer each question:
- How many maintenance plans do you have?
The answer to this question might not be as easy as you think. If you said, “I’ll just look at my software,” you might not be getting the true story.
I’ve seen so many systems where the maintenance plans have not been entered correctly so that you get accurate data out. And, how do you know that the number of maintenance clients your software says you have is the right number? How many are up for renewal? How many have NOT been renewed? And, what happened with those customers who were up for renewal last month and didn’t renew? Did the software automatically drop them off the list?
Getting the real answer might take auditing the software against the actual maintenance program enrollment forms. It’s worth checking.
- What is your renewal rate?
It makes absolutely no sense to enroll 100 new maintenance clients and lose 40 who don’t renew the next year. You can be almost sure that this will happen if you enroll a customer because of a large repair bill and never talk to that customer during the year to subtly remind them the benefits of maintenance.
Your renewal rate should be 80% or higher. A few of the contractors I work with have renewal rates over 90%. The people who don’t renew are usually those who move or pass away.
If your renewal rate is less than 80%, the goal should be to get the renewal rate to at least 80% or higher in 2019. Talk with your clients – through emails, through postcards, through newsletters, etc. If you don’t want to do it yourself, check out our maintenance retention program. We’ve got a “made for you” program that you don’t have to think about. It automatically communicates each month. Here is a timeline of the program:
Also, remember to put stickers on the indoor and outdoor units as well as on the breaker box. You want your company name and phone number to be seen if there is a problem!
Customers should also have jar openers, magnets, chip clips, pizza cutters, or other giveaways that stay in the kitchen and get used. All of these items should have your company name, phone number, and website address on them.
- How many new maintenance clients do you enroll as a percentage of the non-maintenance customers you visit?
If you know that, on average, you visit 10 non-maintenance customers and enroll three of them, then about 30% of your non-maintenance customers will enroll in your maintenance plan. Also look at this statistic by technician. If there are some technicians better at enrolling than others, make sure those technicians go to the customers who don’t own maintenance plans!
- How many replacement leads do you get from maintenance and non-maintenance customers?
If you are not getting any leads from your service technicians’ visits to homes and offices, you have a major problem. Your service technicians are your eyes and ears in homes and offices. They are considered the experts. Hopefully they believe in high efficiency equipment and not fixing parts (I knew a technician who used to file the points on contactors rather than replace them!).
Technicians should provide replacement leads. You should know how many leads are generated from how many calls the technician ran. Again, if you have great lead generating technicians you should send them on the older equipment calls.
Your sales people should close 80% or higher of the maintenance leads they receive. The closing ratio will be lower for non-customers and customers who do not own maintenance plans.
Once you know the answers to these questions you can decide whether you like the numbers or need to improve them.
Now, let’s look at a fun way to kick off spring. Let’s start with a story of a contractor I worked with:
February was this contractor’s worst month of the year. We decided to do something about it. We looked at the February monthly revenue for the past three years. Then we chose a minimum revenue goal that was a stretch but not impossible to attain.
We presented the idea to the entire team. We told them what the numbers had been in the previous years. Then we asked them what they thought the company could do if everyone pitched in and came up with ideas that could be executed. (We didn’t tell them what we came up with). The group came up with a higher revenue number than we were willing to accept. It was a stretch but no one thought it was impossible to achieve.
Assuming the company reached the goal, the owner would take everyone and their spouses/significant others out for a steak dinner at a great steak restaurant in town. And, the company paid for the babysitters…so that everyone could go and enjoy an evening out.
What happened? Everyone came up with ideas and leads. They were implemented and great results occurred. The company met the goal and everyone had a fun evening out.
So, choose the month of March or even a three month goal. Have the prize be a steak dinner or a monetary prize or something else. It’s your choice. Just make sure that all of your employees have input and believe that the goal can be met. If you are like most contractors I’ve done this contest with, you’ll be shocked at who comes up with the greatest ideas and how motivated everyone can get.
It’s a fun way to start the spring…and increase revenues at the same time.