Service businesses often dedicate so much time to designing, quoting, installing and managing projects that they leave little time for developing customer service. Yet, customer service is powerful – reducing the threat of competition, providing recurring monthly income and encouraging repeat business from existing customers.
Here, Jim Rathbone looks at 9 benefits of refocusing and accelerating the growth of your service business.
I have worked with a lot of installers of building technologies whether that is fire and security systems, automatic doors or audio-visual systems. It is amazing how little time is invested by the business owners and the management in growing the maintenance and support services.
Most of the time and energy is invested in designing, quoting, project managing, installing and getting paid for the installed system. Yet most of the profit is made in the service area.
One of the key drivers of delivering sustainable profits is the focused development of services.
9 benefits of accelerating the growth of your service business
Provides a recurring income stream
Delivers higher margins (Gross Profit can exceed 50% for service and can range from 15% to 35% for installation)
Maintenance contracts provide follow on sales in call-outs and parts (depending on the contract type), extra works and upgrades,
Provides a longer-term source of revenue as contracts can run for up to 10 years and beyond
Provides the means of repeat contact with the customer
Reduces the threat of competition
Provides a source of sales and profitability in downturns as well as upturns. Contrast this with the installation project business which is more affected by the economic cycles
Generates a positive cash flow
Gives a more secure environment for the staff
ACTION POINT
Make a firm decision to accelerate the growth of your service business and take advantage of all the benefits from this growth. If you would like help on developing and implementing an Action Plan to achieve significant growth in your service business drop us an email at info@rathboneresults.com or ring 020 8798 0175.
Jim Rathbone
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