The service business climate is competitive and constantly changing. That means your company need to be willing to adapt to the current business climate, plan and budget, focus on customer service, use benchmarks, and be open to new ways of doing things. The ideas below can give you some direction of what to do or reassurance that your company is on track.

Be willing to adapt to the business climate around you

Today is different from yesterday, and you may not even recognize tomorrow. Running a service business means making the best decisions with the information you have. The service business climate is always changing, so keeping abreast of the current climate is an important part of making sound decisions for your company.

That does not mean just to do what everyone else is doing. Sometimes that is the worst strategy of all.

Plan and make a budget

Even though you cannot know what tomorrow will bring, it is critical to have a plan and budget. It may only serve as a guideline, but it is better than going in blind. In running your business, you can only improvise and go off script when there is a script to begin with.

In making your company’s budget, remember all the unplanned expenses and make sure there is money available to take advantage of new opportunities for growth.

Focus first on customer service

Your customers determine the success or failure of your business. Serving their needs always has to be the top priority. Without their trust in your company’s ability to perform, they will not come back to you the next time they need service and they certainly will not recommend you to a friend.

You want your service company to come to mind first when your customers need service. The way to get there is to make sure they are the first priority in every interaction they have with your company.

Set benchmarks to measure company performance

We live in a digital age. You can measure everything your company does. With benchmarks, you can also determine if what you are doing now is better or worse than what you were doing before.

With these benchmarks and measurements, you can see what parts of your company are making you profitable and which parts are holding you back. You can see where success is happening and replicate it, and you can see where there is still work to do.

Never say, “This is how we’ve always done it.”

What worked in your business before might not be working now and certainly will not work forever. A business that makes decisions now based on what they did five years ago is looking for trouble.

Instead of saying, “This is how we’ve always done it,” try, “We tried it that way before. How can we do better?” An attitude that you can do better is self-fulfilling.

Running your business by the principles above will not only keep your company in business but will set it up for growth and development. It is not possible to do business like you used to, but new techniques and new tools mean your business can still get ahead.

Capital budgeting is the process where a business decides if a long-term investment is worth pursuing based on its long-term benefits. These types of capital investments could be in vehicles, buildings, tools, or technological improvements.

Usually, businesses will look at the lifetime cash flows (both in and out) that will be associated with the investments to determine if the returns make sense. For instance, when purchasing a new truck for your business, you may also have to hire a technician to drive it and to go to job sites in it.

The cost of many larger capital investments can be spread out over time through financing. However, for some investments there will be a larger investment up front, but then benefits that continue indefinitely.

Capital budgeting decisions can become a key factor in the long-term profitability of a company. Therefore, owners and managers need to compare the benefits and costs of the various capital investments they can make in their companies. There are many techniques companies can use to determine the long-term value of an investment.

I won’t go into them in too much detail here, but I will list and link to places to learn more:

• Accounting rate of return
• Net present value
• Profitability index
• Internal rate of return
• Modified internal rate of return
• Equivalent annuity

Most of the methods take into account the incremental cash flows or cash savings from the potential investment or project. Using these methods can help you determine if investing in new vehicles, new equipment, new warehouses, or new technology will be a wise investment.

The most important factors to consider are the total costs that will be present, including purchase price, maintenance costs, operational costs, etc. Vehicles for your service company, for instance, are good investments, but there is also the cost of running another vehicle (including maintenance, fuel, and manpower) to consider.

The process you use to budget for your equipment or technology improvements will vary based on what you are thinking of purchasing or accomplishing. However, one of the most important parts of budgeting is determining what you need and how it will help you.

Determine what the capital improvement project will accomplish or what time-consuming task it will replace. Look at the opportunity costs that not having the equipment or technology is costing both in the short and long-term. Then look at the cost of doing nothing both in the short and long-term compared to the total cost of the investment.

Finally, remind yourself why you were considering this capital investment in the first place. What are you trying to accomplish? What pain do you expect it to ease? With the costs and benefits in mind, estimate what kind of return on investment you can expect. Are you assumptions realistic? Will the benefits outweigh the costs by enough?

Thinking through all the costs and benefits of any capital improvement project will let you make the smartest decision for your company. Sometimes inaction is more expensive in the long-term than the investment in the new equipment you’re considering. Keep that cost in mind too when doing capital budgeting.

How do you go about deciding what investments are right for your company?

Every sale you make, every dollar of revenue you earn came from a customer that chose you over a competitor. Why did they pick you?

Chances are you are not the only service provider in your city, so there must have been other factors at play. Understanding what those factors are can help you know your customer motives and how to replicate the reasons your current customers selected you to gain new customers.

Each of your customers chose you because you offered the benefit they wanted. You offered the right combination of logical and emotional components that they wanted and needed. Your offer provoked them to take action and choose your services over all the other providers and the option of doing nothing.

Your customers chose you over a competitor. Your competitor’s customers chose them over you. Do you know why? The fact that they chose you means they found something different or better. But it also means that when they pick your competitor.

Knowing what those factors are means you can promote and differentiate your company based on the real reasons your customers choose you.

Here are some reasons why your customers choose you:

• Your company can best solve their problem
• Your company is the most reliable
• They trust your company
• You offer good after sales service
• Your company offered the best price
• Your company is the closest
• Your company was available to meet their schedule
• Your company was easy to buy from
• Your company was the first they found

Which of these answers apply to your customers? What can you do to present your company as the one that represents that choice? Understanding why your customers buy from you will give you a clear picture of your strengths and weaknesses and will show you how to broaden your appeal so that new customers will also choose you.

People will only buy from you when they want to. It is your responsibility to understand why the people who bought from you wanted to and to then communicate to others why they should want to buy from you. People will buy from you when they decide they want what you offer. Do you offer what they want? Do you know what they want? When you know what your customers want and offer it, they will buy from you and not from your competitors.

What other reasons do customers buy from you? What do you do the help them along the way?

Your company probably already has a Google Places “Page,” but if you have not claimed it yet, you are certainly not taking full advantage of all the free benefits a Google Places listing and page provides.

Google Places is similar to the Yellow Pages in that every company with a physical address is able to be listed. However, it is very important for local service companies to have a robust Google Places Page because these pages appear near the top of Google’s organic search results when a person does a local search.

Here’s a quick overview video of what Google Places and why you should use it for your business:

To get the most out of your free listing you should claim the listing, fill it out with all of your company’s important information, get customer review, create and keep it up to date with current content and coupons, and add photos and videos.

1. Claim your Google Places Page and make it your own

To claim your Google Places Page, go to Google.com/places. If you already have a Google account you can just log in. If not, it only takes a few minutes to set up an account, which you can do from the page.

Once your account is set up you can enter your business’s main phone number to see if it’s already listed on Google Maps. If it is you can go through the process of claiming the page which will allow you to edit the existing information as well as add other details, photos and videos.

Once you have logged in and claimed your page, it is important to fill out every field available on the form. The more complete a profile, the better it will appear to your customers and prospects when they find your listing in search. There is also a place to upload your company logo so that it can appear in the Google search results.

The form will ask for basic information about your company, information about your operating hours, what payment types you accept, as well as what your business does.

You are even able to define your service area. Rather than just having a static location, you can show on your Google Places page what Zip Codes you serve or even define a mile radius around your headquarters. The video below will give an overview of how this works:

The images below show the field you can fill out on your Google Places page.

Google has a comprehensive guide that will help you claim your page and get started optimizing your Google Places page.

2. Get Customer Reviews

It’s important to make it easy on your customers to review your company on your Places page. Reviews may raise your pages rank in the search results, but even if they don’t, reviews on your page adds credibility and lets prospects know that other people have used your services and been satisfied.

On your places page there is a link that you can copy into an email and send to your best customers requesting they write a short review of your company. Google says you are not allowed to offer incentives in exchange for reviews, so you will have to request reviews from customers you already have a good relationship with.

3. Keep your page fresh with current content

You are able to leave short, 160 character posts on your Google Places page. These short Twitter-like messages can be details about the services you offer, announcements of special events, introductions of new employees, promotional offers, or any other message. When you are logged into your Places page there is a box on the right side with the heading “Post to your Place page.”

You are also able to offer coupons to your customers and potential customers for your services on your Google Places page. These coupons will be visible at the top of your Places page. With these coupons it is important to make them unique to your Google Places page so that you can easily track their effectiveness. It is a good idea to keep these coupons fresh. One way you can do that is by using them as seasonal promotions, giving you the excuse to offer various coupons throughout the year.

Keeping the messages and coupons up to date will keep your page fresh and current in the eyes of your customers.

4. Add videos and photos to your page

You are also able to add photos and videos to your places page. If you company has an ad you could upload it to YouTube so that your Places page visitors can view it on your site. You are able to have up to five videos so you could also use some of these spaces for video testimonials of your customer or videos of examples of your work.

You are also able to upload up to 10 images. These could be pictures of your service trucks, employees, job sites and work you’ve completed, or anything else that would be relevant to your customers.

For a complete check and to make sure you really get the most out of your free Google Places page, complete the Google Places Checklist.

After you are finished, share a link to your Places page in the comments so we can showcase the best examples.

LinkedIn is a powerful resource for connecting with others in your industry. It provides a forum to share expertise and experience, as well as a good place to learn from other experts in your industry. For HVAC and other service contractors, there are a number of active groups you can easily join and get involved with.

LinkedIn groups help you quickly discover what other professionals in your industries are discussing. They also give you an opportunity to listen in to the discussion as well as have an active voice in the conversation. You also get a vote on what is useful to you by ‘liking’ posts and comments.

Below is a collection of some of the largest of these HVAC and service contractor’s groups on LinkedIn.

Air Conditioning Contractors of America Members

Helping HVACR contractors acquire, serve and satisfy their customers.

HVAC Professionals

I created this group for those who are dedicated to the HVAC Industry and would like to expand their network with professionals within the various facets of this business. I encourage everyone to utilize the knowledge base of the other members so that best practices can be shared.

Owner: David Spaeth | 6,812 members

Home Service Professionals

This group is for Marketing, Sales and Business Development discussions in the home service professional industry. Companies such as home improvements, plumbers, electricians, HVAC, landscapers, cleaning services, window replacements, roofers, painters, etc.

Owner: Lance Brown | 1,021 members

Make Each of Your Customer Interactions During Service Agreement Service Call a Selling Opportunity

August is almost over. That means the hot weather and the summer busy (or crazy) season is drawing to a close for much of the country.

It also means it’s time to take a look at the health of your service agreement program. Did your technicians sell more new service agreements than they did last year? Did your renewal rate improve? Do you have enough service agreements to keep your technicians busy through the winter? How has your service agreement base affected the overall value of your business? These are all good questions to ask to get ready for next summer’s busy season.

The summer busy season was a great opportunity to sell service agreements to your new or repeat customers. I hope your company had a successful year for selling service agreements. I also hope that the service agreements you sold are more than just a way to keep your technicians busy during the slow times.

Service agreements do give you revenue throughout the year and help to spread out the annual work load, but they also give you an opportunity to sell to your customers. A routine service check can uncover major problems for your customers before they become emergencies.

Those same routine checks also get your technicians face-to-face with your customers, which will beat the odds of door-hangers and direct mail any day of the year. You have a huge opportunity here. Your customers are expecting you to come. They’ve invited you in.

However, this direct interaction will be a huge waste if your techs just go into the house look at the equipment, change a filter or two and move on to the next service call.

This doesn’t mean you can invent problems or be dishonest with your customers, but your technicians should approach each service agreement call as an opportunity to find a way to help the customer through suggesting an equipment upgrade to save energy, proposing automated climate controls to make their house more comfortable, or some other way that you can benefit your customers.

You’ll want to make sure your technicians are prepared to sell during each encounter they have in the home of your service agreement customers.

Conversion Rate on a Service Agreement Call

Conversion rates on these routine calls will probably be much lower than your conversion rate of service agreements or ordinary service call, but it stands to bring in more sales dollars because you’ll be selling a more tangible product or service.

During a service agreement service call is the best time to bring up more extensive tune-ups to prepare equipment for cold weather and seeing what equipment is in need to replacement.

Conversion and sales rates are going to vary by your type of Service Company, but there are a few principals that will remain consistent.

1. Set a conversion rate goal: Every one of your technicians needs to know what the goal is and how well they are doing to reach it. Each tech should know where they stand.
2. Sales Training for Technicians: First and foremost, your technicians are technicians and the good work that they perform will have to stay priority number one. However, they are also the ones on the front line of your business. They have the most face-to-face contact with your customers, and therefore are best suited to selling to them.
3. Provide Strong Marketing Materials to Your Technicians: Your technicians can sell and talk about solutions, but many times it will not be a one call close. However, the marketing materials they leave behind after the sales conversation can help in the decision making process, as well as fill in many of the technical gaps that don’t get talked about in the sales conversation.
4. Reward the Results: The technicians that succeed in converting more sales should be rewarded generously for their efforts. Give them the incentives they need to stay motivated and focused on their goals.

You worked hard to get these service agreement customers. They trust you and count on you. Make sure that you serve them well by finding ways to make them more comfortable and making sure they’re equipment doesn’t break when they need it the most.

Intuit, the makers of QuickBooks announced in a recent press release that they believe small business employment is rebounding.

Small businesses are showing signs of an economic rebound. This is the main finding of the just-released Intuit Small Business Employment Index, a new, monthly report that provides unique, near real-time insight into employment trends of the smallest of small businesses.

via Intuit Press Release – Small Business Employment Showing Signs of Rebounding.

This is good news for many of the nations unemployed as they seek new jobs.

However, the Intuit index indicated hourly compensation has been mostly of the past several months and has actually declined recently.

About the Index

The Intuit Small Business Employment Index is based on online data from approximately 50,000 small business employers with fewer than 20 employees who use Intuit Online Payroll. Intuit reports data for three categories: small business employment, compensation and hours worked. Intuit will analyze and publish the data at the beginning of each month.

We’re curious. Is your company hiring again? Are employees working more hours? Leave your feed back in the comments.