Service Sales Training
A poll posed the question “Please identify the Top 3 service-orientated areas to tap into to generate more recurring revenues.” Leading the way was “Maintenance/Service Agreements”.
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Placing a value on a firm that installs and services life safety systems isn’t an exact science. Having worked with both buyers and sellers of fire alarm, sprinkler, and security firms the valuation gap between the two is often wide.
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All building systems are not created equal. Too often building systems are grouped together by function or application. A good example is life safety systems. These systems include fire alarm, security, sprinkler, suppression, nurse call, sound, etc. All of these systems have life safety implications, but their service requirements are quite different. Fire Alarm, sprinkler, and suppression systems are passive systems. Unlike interactive systems like card access, CCTV, HVAC, or elevators, no one is interacting with them on a daily basis. Typically the building operator is made aware for the need for service when interactive systems fail. These failures are typically brought to the attention of the building operator quickly, often by multiple parties. This is not the case with passive systems.
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There would be less need for Service Sales Representatives if all products and systems were sold directly to end users. In many cases the initial sale is made to an installer, contractor, purchasing department, or government agency. It’s very likely the end user who will make the decision regarding the service agreement, was not involved with the initial purchase. When it comes to older systems the end user may be many years removed from the initial sale. Often the service firm’s internal records regarding the sale don’t help in locating the current decision maker. The project may be listed under the name of the installer or contractor, or just the address of the facility.
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I was part of a panel discussion regarding how to grow service at a life safety industry trade show. Many of the firms attending were planning to expand their brand by adding an additional product line. Some of the mentioned additions included fire alarm, sprinkler, sound, security, etc. The primary justification for adapting their business model is the lucrative service, RMR, available for this type of equipment once installed. Most agreed that service was the goal as profit margins, on the installation of these systems, wasn’t very attractive. Additionally, a significant investment would be required in design and engineering skills and a fairly steep learning curve. Everyone seemed to agree that it was worth the effort and risk.
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I conducted a poll of over one hundred Fire Alarm and Sprinkler firms on the best ways to improve profit margins in service. The participants were a cross section of my clients, and non-client firms that are in my database.
(Other items: Improve customer service skills, manage manpower, etc.)
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Let’s state the obvious; Service is good, Service revenue is good, serving our customers is good….no need for debate or discussion. Everyone acknowledges service is profitable and it helps retain customers. I have never dealt with someone who stated, “I make so much money installing products and systems I don’t need the service revenue.” When the discussion turns to investing in service marketing the conversation usually gets apologetic, or some just plead guilty. Very few firms set aside funds for service marketing aids or service sales training. Technical training sure, software investment often, but putting some commitment and dollars specific to service marketing, it’s the exception. That leaves sales and marketing efforts that are dated and out of touch with current conditions. Sales reps have no formal service sales training and utilize service agreements that demonstrate little value to prospective clients.
Continue ReadingA key to success for any business is growing its customer base. It’s typical when speaking to a firm they refer to “their base”, as repeat customers. That may include clients who come back to them for equipment purchases, upgrades, enhancements, repairs, service, etc. This is a fair representation of a customer base, but it doesn’t differentiate the most sought after base by most highly successful firms.Continue Reading
This year I’ve been asked about “getting out” of the installation business more than any time in the past. Not surprisingly Covid has affected owners and operators’ perspective on their firm’s financial health. It’s raised a serious concern regarding their current business model moving forward. Some firms haven’t been affected as they had projects in the pipeline or were able to capitalize on existing relationships. Unfortunately, many have seen projects delayed, or cancelled. Almost all are concerned about eroding margins when they’re successful winning jobs. The margin issue is made worse by rising prices from vendors and subcontractors.
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Most firms recognize the importance of providing training for their technical staff. It may be provided by outside sources or done in-house using mentoring programs. Technical training is readily available for installing, or repairing products or systems, as well as, working with software. The cost can vary from thousands of dollars to no charge from suppliers. Business owners and operators typically don’t even consider the ROI as they know it’s a necessity, not an option. The inability to resolve technical issues in a timely manner is expensive and directly impacts customer satisfaction.
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Perfect for all personnel involved in service sales, this book describes the keys to success for selling service on technology-based products and systems. Anyone indirectly involved in service sales such as technicians, engineers, administrative assistants and others who work with customers will also find the book beneficial.
Readers will learn the unique skills and methodology required to be successful from the industry expert.
