Techniques and Tactics for Building a Profitable Service Department Mike Hajduk

Transcription

1 Denver, CO October 18-20, 2017 Techniques and Tactics for Building a Profitable Service Department Mike Hajduk Mike Hajduk currently serves as president of Callahan Roach Business Solutions, the premierprovider of flat rate pricing and marketing products in the HVAC, plumbing and swimming pool industries. In this position, he manages and oversees the day-to- day operations of Callahan Roach based in the Dallas suburb of Arlington, Texas. Callahan Roach has delivered products to, or trained over 5000 service contractors in the United States since Mr. Hajduk has over 40 years of experience in the HVAC industry. Before joining Callahan Roach Business Solutions in late 2000, he served as executive vice president of Excellence Alliance Inc., an organization of allied service contractors. He has also directed the marketing systems division and was vice president of training and development for Callahan/Roach & Associates, then the parent company of Callahan Roach Business Solutions. Mike has six years experience at Lennox Industries, the national premium manufacturer of residential and commercial heating and air conditioning equipment and related products where he served as a business consultant and corporate Director of Business Services. He is a frequent speaker at trade shows, association keynote addresses and dealer meetings. Abstract This session is intended for contractors who run service as part of their business. When you walk away from this session, you will have actionable steps for immediate implementation. National Swimming Pool Foundation conference@nspf.org

2 Tactics and Techniques to Help Build a Profitable Service Company World Aquatic Health Conference October 19, 2017 Mike Hajduk President, Callahan Roach Business Solutions Hi Duke Workshop Purpose To give the attendee actual tools with which to take back to their business and implement quickly.

3 Workshop Payoff Gain more Sales Satisfy customers Build Wealth 25% 30% Of all Service Businesses go out of business Every Year Businesses do not go broke because of lack of sales..they go out of business because of the lack of CASH! Unapplied labor in US Service Companies is %!!!!!

4 Net Margins in Service Companies is Low Single Digit Low single digit 3 6% 3 6% How do Pool Service Contractors price service? How do I establish a price to charge?

5 How do I establish a price to charge? How do Pool Service Contractors price service? Suzie pricing... Scardy cat pricing SWAG pricing Profit pricing Competition Market forces No idea, sounds right Costs plus profits and asset growth. Understand Your Breakeven Breakeven is the point in business where your Fixed and Variable Costs to operate your business equal your Sales after which you can accumulate profits and funds from which to grow your business.

6 How do I establish a price to charge? Labor Costs Company Overhead Costs Desired Profit Paying for Growth Handout Profit Calculator What is the breakeven for the Swimming Pool Industry?

7 What s the Answer? Flat Rate Pricing Flat Rate Pricing 91% of American Households want their inhome service provider to offer an up front, flat rate price. Decision Analyst, Grand Prairie, Texas In a Time & Material World Customer wants the lowest rate. Customer does not want to pay travel/service fees. Customer has selective hearing

8 In a Time & Material Service Company A tech is given as many calls he can run. Tripped breaker. Flip breaker or replace. Callback two weeks later. Time & Material Pricing What s Wrong With It? Do you Pay more for a steak that is cooked well done vs. rare? Pay more for a movie that is 2 hours long vs. one that is 1 ½ hours long? Like paying $35 for the first piece of luggage and $135 for the second piece of luggage on your trip to Denver? But that is exactly what you are doing when you charge customers on a time and material basis!!

9 What is your business preference? To run a business that is a) The fastest company b) The most profitable service company c) The most quality service company The Flat Rate Solution What is Flat Rate Pricing? One up front, no surprises price where the customer is assured of the amount of the check that they will be writing. A price that includes all items to make a repair. A price that does NOT reveal your hourly rate!

10 What do you charge for service? We Charge $80 for the first ½ hour and $20 per quarter hour after that. The Flat Rate Answer We don t charge by the hour, we charge by the job. Our technician will come to your home and for a fee of $ he will thoroughly evaluate your system. He will then give you a written proposal for the repairs to fix your problems and allow you to accept or decline the recommendations before he starts the work. What The Customer Likes Customer feels in control. NO open ended contract. Able to accept or decline. Repairs up front. No surprises.

11 Customer Price Reaction Hourly Labor Rates (Flat rate books are based upon this labor sell price) $60 $70 $80 $100 3/4 HP Impeller (This is a 30 minute repair, with a $42 part) $72 $77 $82 $87 Replace 325,000 BTU Burner Tray $242 $257 $272 $302 (This is a 1.5 hr repair with a $152 part) What The Boss Likes More New Customers Less Pricing Mistakes No More Laboring Bidding Higher Rates More Profits No stopwatch service What the tech likes No blame for wrongly estimating service cost No complicated call building Time to be a Craftsman

12 Workshop Payoff Gain more Sales ($) Satisfy customers Build Wealth How well do your customers like you? Net Promoter Score Frederick Reichheld The Ultimate Question Would you recommend us to a friend?

13 Net Promoter Score Would you recommend us to a friend? Scale of 1 10 Promoters 8 10 Passives 3 8 Detractors % 70% 5% 25% 5% = Net Promoter Score of 20 Average Score in US is 10 to 15 How do I get my customers to love me If only I had better employees If they were nicer to my customers, we wouldn t If my customers weren t such jerks What do the customers expect today? R.A.T.E.R. R A T E R

14 Points of Right Putting POR into Action Management Commitment Create Action Teams Workshop Payoff Gain more Sales Satisfy customers Build Wealth

15 What makes your business worth more?* 1. Top line revenue 2. Non reliance on any one customer, employee or supplier 3. Ability to Grow 4. Recurring Revenue 5. Will your customers recommend you to their friends? 6. Do you have the team in place to grow a business? *John Warrilow, The Value Builder System Maintenance Types of Agreements Good cash flow Less technical staff Route mindset Types of Agreements Preventive Annual or Semi-Annual visits Openings and/or Closings Loyalty to Pool Service contractor You WILL get the replacement and upgrade sale!

16 Service Agreement Program A Tool for you! Marketing Service Agreements Your Maintenance Accounts Your Installations Your Remodels Out of Warranty Installations Your current Reactive Service Customers Neighbors of Current Customers Workshop Payoff Gain more Sales Satisfy customers Build Wealth

17 Questions? Thank You! Mike Hajduk