There is no argument that providing bi-annual or annual HVAC system service/maintenance agreements can be vital to consumers’ peace of mind as well as to a contracting firm looking to even out the seasonality of the business. And typically, April is the time when most contractors are looking to renew and sell these instruments.
However, there is one aspect of maintenance agreements that may be back-burnered by contractors: providing true value versus the cost. For some contractors, it is a numbers game — bragging rights as to how many agreements they have and service. Others succumb to the marketplace pressures where competitors and some “consumer media” tell customers that maintenance agreements are just a way for your company to squeeze more dollars from their pockets.
For those who are all about bragging rights, you are missing the point. On the other hand, if the number of agreements your company sells and services is vital to the continued success of your firm by bringing in additional revenue during shoulder seasons, then you are right on point. The intent isn’t to rip off customers.
However, to avoid any misunderstandings you must show the true value of your maintenance agreements to customers.
First, pricing needs to be fair. Maintenance agreements shouldn’t be so expensive that customers think it’s a rip-off and may only consider buying one-off services when they need it. Still, pricing should be high enough to cover costs and provide you a fair margin.
Second, you should provide options — different types and/or levels of maintenance so your customers have choices.
Create Club Memberships
Take, for example, the approach to maintenance agreements as a membership or VIP club. By providing points that equate to discounts for consumers on services, you can entice them to buy maintenance agreements from you.
A great example is how Rob Minnick and his team at Minnicks, Inc. do this very thing. Read all about it on page 13 of this issue. In fact, Rob takes it one step further. He offers customers three choices, one of which is a unique program called Smart Maintenance. With that, he can remotely monitor and manage customer systems without having to bring on more staff and more overhead.
The Performance Approach
Furthermore, Rob creates value through programs like VIP memberships and smart maintenance. Plus his field service and installation teams operate under the Performance-Based Contracting™ method. This means all maintenance tasks include static pressure/temperature testing as well as ductwork analysis and diagnoses. His customers receive value in comfort and energy efficiency. They have the peace of mind knowing Minnicks is watching out for them.
This is so important for three reasons: It differentiates Minnick’s from its competitors, it brings in much-needed revenues, and provides his customer base with a value that flies in the face of negativity reported from sources like Checkbook.org and Angie’s List.
So the question is, are you more concerned with the number of agreements you sell or are you focused on providing true value to customers? What are some unique value propositions that your maintenance approach brings to the market?
Drop me a note at MikeW@NCIhvac.com.