Service Tips


Tolerating Temper Tantrums

Tolerating Temper Tantrums
When you see this behavior, you must act quickly to nip it in the bud.

We are all familiar with temper tantrums thrown by children, some of them have been from our own kids!  What happens however when adults throw a temper tantrum at work?  For example, what should you do if an employee, enraged over a phone conversation, rips the phone from its cord and throws it across the room?  If the employee is a top performer or essential employee, do you ignore this behavior?  Should you?  The answer is – absolutely not!  Tolerating such behavior essentially tells other employees that doing such things is okay, and it provides cover for them to do something similar.  In addition, you are training the abuser to continue their unacceptable behavior.  Over time, this can create a toxic atmosphere in your company.  How widespread is this issue anyway?  Consider the following statistics.*

  • 60 million Americans are affected by abusive conduct in the workplace
  • 61% of Americans are aware of abusive conduct that takes place in the workplace
  • Up to 81% of employers are perceived as doing nothing, and resist taking action when targets of abusive conduct fill out a survey
  • 71% of employer reactions are harmful to the workplace targets of abusive behavior
  • 29% of employees who are targets of abusive behavior remain silent about their experiences
  • To stop abusive behavior in the workplace, 65% of targets lose their original jobs

* Statistics from the June, 2017 National Survey On Workplace Bullying by WBI

So, what should you do when such behavior is exhibited, given that you are not willing to tolerate it?  Essentially, you have two choices.

  1. The easy path is to simply fire the employee.  On the positive side, this sends a clear message to all employees that abusive behavior will not be tolerated.  On the negative side however, you lose a top performer without finding out if they could be rehabilitated.
  2. The more difficult path is to document the abusive behavior, coach the employee, and put in place a corrective action plan for them.  If that does not work, proceed to termination.

If option #2 is chosen, it is important to immediately react to the negative behavior by sitting down with the employee and take the following steps.

  1. Describe the offending behavior to the employee by describing their specific actions.
  2. Explain to the employee the impact their behavior has on other employees as well as customers
  3. Let the employee know what behavior(s) you will not put up with in the future.  Also, let them know exactly what will happen if they exhibit such behavior in the future, up to and including termination
  4. If such behavior occurs again, you must act – and quickly.  You must also be prepared to terminate the employee if necessary

If you have an employee handbook, you should include a discussion about abusive workplace behavior, and consequences for same.  Know however that actions speak louder than words, and as the employer, you must be prepared to act on the words you have committed to.

Source: thebalancecareers; How to Deal with a Bully at Work


You Talk Too Much!

Have you ever known someone who talks nonstop, the type of person with whom you can never get a word in edge wise?  Of course you do.  They are the proverbial chatty Charlie or chatty Cathy.  Of course, some of us are more talkative than others, and there is no clear-cut definition as to when the line is crossed between being chatty and wearing you out.  The answer is – it depends!  That is, it depends on you, as everyone has a different threshold.  What are some of the reasons chatty people talk so much?  Consider these possibilities.

You talk too much
This Driver might appear to be winning her argument, but is this Amiable actually listening?

The person you are talking with is anxious about the situation they are in, the surroundings they are in or about the fact they are speaking with you.  If you are an executive or are perceived to hold a position of power, people might have anxiety speaking with you.  Their nervous reaction is to keep talking.  Another possibility is that this person wants everyone they speak with to share their point of view, and they believe the only way to get you to listen is to tell you everything they know.  They don’t see themselves as trying to influence you so much as to teach you about what they now.  Yet another possibility is that they want others to see themselves as having status, as being the one in charge, or the one who knows the most.  We might see any of these people as being really friendly – or really irritating – depending on the type of people we are.  To understand the type of people we are, we have to look at social styles.  Founded by the Tracom, Group, Social Styles® is the world’s leading behavioral style model.  Only by better understanding ourselves can we more effectively communicate with others.  According to this model, there are four unique social styles, as discussed below.

Analytical Style.  These type of people are thinkers, and need a lot of information before making decisions.  They typically ask a lot of questions.  They often feel the need to be correct.

Amiable Style.  These type of people are focused on relationships and are often seen as friendly and warm.  They openly show emotions and feel the need for personal security.

Driver Style.  These type of people are seen as action oriented, efficient and assertive.  They are typically quick to act but slower to listen.

Expressive Style.  These type of people are creative and enjoy sharing ideas and perspective with others.  Ultimately, they thrive off spontaneity and need personal approval.

While the full scope of understanding of this behavioral model is beyond the scope of this column, it allows you to think about your style and how to best interact with others whose style you perceive to be very different from your own.  For example, imagine a situation where a driver is in conflict with an amiable.  The amiable person perceives the driver to be acting without listening, and has been hiding how they feel about it.  Meanwhile, the driver person perceives the amiable as someone who is not focused strongly enough on action, because they are always talking.

In the final analysis, you can only control yourself.  Resolution is most achievable and yields the best outcomes when two things happen.

A.  You understand your social style and how you might be perceived by others

B.  You adapt your behavior to become more in sync with the other person’s social style, thereby reducing conflict and enhancing true communication

For a deeper understanding of this topic, please visit https://tracom.com/social-style-training/


Handling Irate Customers

No one likes the confrontation posed by an irate customer, but there are some specific techniques you can use to make that interaction better and more productive.  We all understand the emotions involved, after all, we have probably been an irate customer our self at one point or other.

 

The first thing to understand is that it is usually not personal.  More often than not, the customer is upset about a situation (i.e. a call back, a bill they think is too high etc.) as opposed to an individual.  That being said, there are a number of things you can do to defuse an irate customer.

Body Language Is an Important Indicator As to the Customer’s True Feelings

  1. Turn off your phone or put it on silent mode. Let the customer see you do this, that will tell them that they are the priority.  When talking with them, give them your full attention and make eye contact.

 

  1. Let them know you are listening by nodding your head and saying okay. Periodically, restate what they have said in order to make sure there is absolute clarity.  Phrases like, “So, what you are saying is…”  If you are unclear about what the customer has said, ask questions.  As you are listening to the customer, write down what they are saying so that you have clear and total recall later.  The very fact that you are writing things down provides the customer with assurance that you truly are listening.  Let the customer finish speaking before you say anything, and focus on hearing what they are saying, and not what you want to say.

 

  1. Pay attention to body language. For example, if the customer has their arms crossed, that may indicate they are feeling defensive and are probably not listening.  If they will not look at you, they are probably not open to anything you have to say.  Both of these are good indicators that you need to continue to listen and ask questions.  Nonverbal cues are signs about how the customer is feeling, and the skilled communicator is attuned to them.

 

  1. Don’t take a side and keep the conversation on track. Don’t go on the defensive if they voice a criticism, rather you should acknowledge their comment without agreeing or disagreeing.  Ask for their suggestion on how to correct the problem.  Say things like, “I understand.  What are some ways you think this problem could best be solved?”  Don’t let the customer rabbit trail into issues that are not germane to the conversation at hand.  Ask a clarifying question to get the process back on track.  For example, you could say, “A minute ago, you told me the furnace was making a loud sound.  Did that stop when the blower quit running?”  Keep the conversation moving along without giving the customer the feeling you are railroading them.  Don’t look at your watch or phone to see what time it is.  When you think the customer has told you everything they needed to, ask them if you have covered all the issues together.  Stay unemotional and, needless to say, don’t say or do anything that is unprofessional.

 

Putting yourself in your customer’s shoes and truly listening to what they have to say is the best way to show empathy for the situation.  Last of all, follow up with the customer quickly on anything you have agreed to do.  Nothing will undermine your efforts like not following up.  Utilizing the above suggestions is much more likely to result in positive relationships with your customers, which in turn can lead to increased business.


The Pete Rose Principle

The Pete Rose PrincipleFor those of you who do not know who Pete Rose is or who never saw him play, I am only sorry that you did not get a chance to watch this icon of American baseball in action.  Unfortunately, today he is best known for the accusations of gambling that led major league baseball to ban him from the sport in 1989.  Regardless however, when you watched Pete Rose play baseball, you knew you were watching someone who truly enjoyed the game.  If Rose drew a walk at the plate, he didn’t saunter to first – he ran.  His aggressive baserunning style included distinctive headfirst slides.  He played in the major leagues for 23 years, amassing 4256 hits, still a record in MLB.  His lifetime batting average was .303.  All this earned Pete Rose the nickname, “Charlie Hustle.”

 

That’s interesting, you say, but what does that have to do with anything?  It is relevant because The Pete Rose Principle is one we can learn from and apply to our work life, regardless of what that work is.  Success does not always go to the smartest, the most highly pedigreed, or the most polished.  History is full of such examples.  People like Harry Truman, Ulysses S Grant, Steve Jobs, Vincent van Gogh, the list is virtually endless.  Like Pete Rose, these individuals had flaws.  However, they also had an overarching passion for achievement, rising to the top of their chosen field of endeavor.

 

What are some of the lessons we can take away from these individuals to benefit our own lives?  I believe the following five items are key elements of The Pete Rose Principle.

  1. Lifelong learning. So, you graduated from technical school, college etc., now what?  That’s not the end of your learning, that’s just the beginning.  Technology is revolutionizing the world we live in, and that is certainly true of the HVAC industry.  Embrace the concept of continuous learning, lifelong  This will keep you moving along in your career when others have stalled, because they did not embrace this concept.
  2. Passion for what you’re doing ~loving it. During a game in the 1970s, Pete Rose was running in to the dugout at the end of an inning.  Astroturf was a new phenomena in baseball, and Pete was practicing his skill at dribbling a baseball all the way in to the infield.  Passion is something you feel, and something others can see.
  3. Willingness to work hard. This is one of the major traits that tends to cull the herd over time.  People who are willing to work hard go further than people who are not.  You cannot force people to work harder, and you can only incentivize them to do so for a short period of time.  Ultimately, people either want to work hard or they don’t, and it can be a main differentiator for success.
  4. Flexibility and adaptability. We live in a global society, and the pace of change is accelerating at an increasing rate.  What worked yesterday won’t necessarily work today.  Hierarchical organizational structures are giving way to collaborative work teams.  If you are not flexible and willing to adapt to change, you will most certainly be left behind.
  5. Persistence – don’t quit. “Colonel” Sanders submitted his fried chicken recipe to 1009 restaurants before finding a buyer.  Henry Ford was bankrupted, and left penniless five times before founding the Ford Motor Company.  Thomas Edison discovered over 1000 ways he could not build a lightbulb, before he found success.  After high school, Steven Spielberg was rejected from the University of Southern California’s School of Theater, Film and Television – not once, but three times!  After attending another university, he dropped out and pursued directing without a degree.  Persistence is an attitude, one that is born out of the first four characteristics listed above.

 

Your career may never land you in the Hall of Fame, but the Pete Rose Principle embodies traits that bode well for individuals throughout a lifetime.


Bad Mouthing the Competition

Should you ever badmouth your competitor?  Of course, everyone says no, and this is backed by virtually all of the business research on the subject.  Okay then, done deal.  Wait, not so fast.  It’s not that easy.  Anyone who has been in sales for any length of time will tell you that there is always a particular competitor or two that just gets under their skin.  Perhaps that competitor is cheaper, perhaps they are larger and seem to have so many more advantages, and perhaps they even badmouth you.  So, how should you handle these situations and what disciplines do you need to bring to the task?

 

Bad Mouthing the Competition

 

First, the disciplines.  Bad mouthing the competition arises from frustration, an emotion that, while understandable, is under your control.  You have to decide who is going to be the adult in the room.  If you decide that you are only going to talk about your competition in a professional manner, you have to communicate that to everyone of your sales people, service people, office staff… in essence, everyone in your company who talks to the public.  Now for the hard part.  You have to demonstrate that in your behavior every single day.  As we said above, it’s not that easy, but you can establish a culture to this effect as long as you demonstrate leadership, fortitude and persistence – even in the face of potentially outrageous behavior by your competitor and their salespeople.  “That’s fine,” you say… perhaps a bit sarcastically.  So just how do you do this?

 

First, realize that this consumer has contacted you because they have a problem that is, as of yet, unresolved in their mind.  If they had full faith in the competitor that was bad mouthing you, they would have already made the purchase.  That sets the table for you to show the consumer how you have solved this/similar problems for other customers in the past.  Second, don’t merely be dismissive of your competitor.  If you are, you are being dismissive of this customer.…  which does not help to build trust in their mind with your organization.  In addition, you are losing a great opportunity to create an image of your competitor built in the likeness of your choosing.  Your company’s marketing people, with the involvement and approval of senior management, should put together and regularly update a narrative about each of your major competitors that helps potential customers better understand the differences in a way that clearly differentiates your company.  Anyone in your firm who touches the public in any way needs to be thoroughly familiar with these narratives.  What are the elements of this narrative?

  • When your customer tells you about your competition and/or about what they have said about you, first take a deep breath. Then, instead of responding directly, talk about your company on a philosophical level.  Tell the customer why your organization went into business and how you view customers in general.  For example, you could tell a customer that the owners of your firm were frustrated by what they saw as a lack of problem-solving/professionalism/whatever it might be in the geography served, and they went into business in order to understand every single customer’s needs so they could respond professionally and appropriately to those needs.  This is a critical step.  It is much more important for all your customers to understand what your organization stands for, rather than see how you will respond to a tit-for-tat bad mouthing game.  In a manner that is as honest as you understand it, explain how this contrasts with what you understand to be your competitors focus.  For example, your philosophy might be to first understand your customer’s situation in its entirety before you begin to apply solutions.  That would include understanding the health of their duct system, the integrity of the building envelope, the operating effectiveness and efficiency of all mechanical equipment, the health of the indoor environment etc.  Explain how your philosophy is to keep a customer for life, working with them over time to make their home as efficient and comfortable as possible.  Your competitors focus for example, might be to respond to demand service calls, fix the customer’s immediate problem and move on.  There is nothing inherently wrong with either approach, but it sets the table for you to differentiate your firm.
  • Next, provide general examples of why your approach is superior. For example, talk about customers whom you first came into contact with because of a problem they were having, and how your relationship over the years has benefited this customer by solving problems the customer never knew they had, which led to a big improvement in their overall satisfaction.
  • Finally, pivot to this customer situation. Demonstrate not only how you can solve the immediate problem, (which is likely the only one your competitor talked about) but also show the customer some things they can do to improve their environment/efficiency etc. now as well as some things you can work with them on over time to mitigate future problems/improve their indoor environment/reduce their operating costs etc. down the road.  Done correctly, your customer likely won’t even be thinking about your competitor at this point.

 

In the end, all the consumer really wants is to have their problem solved at a price they can afford, (notice I did not say the cheapest price) by a company they feel they can trust.


A Crisis of Trust

Source: supportforstepdads.com

The Annual Edelman Trust Barometer shows an overall reduction of trust in the four institutions it measures; the government, media, business and nongovernmental institutions.  In addition, the credibility of  “a person like yourself” – often a source of news and information on social media, has dipped to an all-time low in the studies history.  The survey shows trust falling more steeply in the United States than in any of the 28 countries surveyed, despite the robust economy and booming stock market.  The survey also showed that Americans’ trust in their own companies fell more steeply than in any other country.  Richard Edelman, head of the communications marketing firm that commissioned the research, said “The United States is enduring an unprecedented crisis of trust.”  Why is that, and could it be happening in your business?

 

The survey sites a number of reasons for this discord.  The past year has been one of exceptional public opinion volatility, and concerns about issues ranging from stagnant wage growth to mass shootings along with a number of others are juxtaposed against the buoyancy of a strong economy.  According to the survey, the result is an unsettled and unnerved public at large.  Particularly for business leaders, the survey suggests that this is not the time for inaction or staying silent.  Getting employees and customers to trust you can be complicated, but it is imperative to your success.  If lost, it may be impossible to recover.

 

According to Chelsea Berler of the Entrepreneurial Network, the following seven concrete actions build trust in a business environment.

  1. Demonstrate That You Trust Others. One way to do this is to be generous and forgiving when someone else makes a mistake or disappoints you in some way.
  2. Create Relationships That Are Mutually Beneficial. Customers and employees all want to believe they are making the right decision to work with you, and trust is about showing people you care about them.
  3. Directly Address Issues. How you deal with concerns and problems is what instills trust and loyalty.
  4. Tell the Truth. If you get caught in a lie, no one will trust you.
  5. Be Flexible and Patient. Trust is built over time, especially when you are dealing with someone who isn’t fortunate enough to have experienced trust in their own life.
  6. Respect Others Time. To earn others trust, raise your awareness of their time, personal schedule and needs.
  7. Deliver the Unexpected. The best way to deliver trust is to delight clients and customers.

 

Click Here, For more information on this topic from this article.

 

Sources: The Edelman Trust Barometer; Chelsea Berler, Entrepreneurial Network


Will You Be among the 65,000?

If it exists in the HVACR industry, you’ll find it here!

If it exists in the HVACR industry, you’ll find it here!

Will you be among the 65,000 attendees that are expected to attend the upcoming AHR Expo in Chicago?  The world’s largest HVACR marketplace got its start 86 years ago as a heating and ventilation show, but it has grown over the years into the event of the year for the industry.  Attending industry professionals will come from every state in the union and 165 countries worldwide.  They will be joined by more than 2000 exhibitors, who will come together to share new products, technologies and ideas.  What kinds of new technologies?  Take a look at the end of this article for just a sampling.

 

This year’s event will once again be held at McCormick Place in Chicago, from January 22-24.  Most people in the industry are familiar with this Expo, commonly called “The ASHRAE Show,” but if you have never been it is hard to imagine the sheer size of this event.  When we mentioned 2000 exhibitors above, we didn’t mean 2000 people.  We meant 2000 different organizations, each coming to exhibit their company’s product offerings!  That is why this international show, held only once every four years, exhibits at the nation’s largest convention center which has over 2,600,000 ft.² of exhibition space.  Fortunately for the attendee, only about 500,000 ft.² of exhibition space will be needed for the HVACR show!  If you are looking for new product lines to boost your company’s sales, or if you’re looking to change product suppliers, or just want to do some first-hand competitive and new product research, there simply is no other opportunity like this show.  This is the granddaddy of them all.

 

Many people do not realize there is much more to this show than just the exposition.  The AHR Expo is also a major educational symposium as well.  There are over 50 free seminars offered on a wide range of topics, most lasting only 1 to 2 hours.  In addition, The ASHRAE Learning Institute will offer continuing education courses where you can choose from half day to full day professional development seminars that offer professional development hour and continuing education unit credits.

 

Finally, if you have never been to Chicago this provides a great excuse to visit a truly world-class city.  Take a stroll along the Magnificent Mile, one of the great avenues of the world, a 13 block stretch of North Michigan Ave. that runs from the Chicago River north to Oak St.  Along the way you will see the famous Chicago Water Tower, one of the few structures to survive the great Chicago fire of 1871.  From world-class museums (i.e. The Museum of Science and Industry, Shedd Aquarium, The Art Institute of Chicago, The Field Museum Of Natural History) to iconic sports stadiums (Wrigley Field) to taking in unprecedented views from atop the tallest building in the Western Hemisphere, (Willis Tower) the “City of Big Shoulders” will quickly become your kind of town.

 

Giordano’s Deep Dish Pizza

Did we mention that you can find nearly every type of food there is in Chicago, ranging from affordable to world-class cuisine?  If you are not familiar with Chicago however, we will pass on a contractor’s tip which you will only find here.  If you are looking for genuine deep dish Chicago pizza, there is only one place to go –Giordanos Pizzeria!  Fortunately, you are not limited to just one location, as there are 18 scattered around the city and even more in the suburbs.  The secret is for you, but just remember, you heard it here first!

 

Sample of Innovations To Be Seen at the AHR Expo

 

  • A digitally controlled mixing valve that provides precise temperature control for domestic hot water applications
  • A self contained HVAC system for hazardous locations, designed to prevent an explosion
  • New bionic impeller technology with a special blade designed to ensure optimized airflow angles and reduced flow separation
  • An oscilloscope for testing motor shaft voltages, allowing contractors to determine if motors are at risk of premature bearing failure

 

For more information, see September 14, 2017 ACHR news article.


The HVAC Gateway Drug

Typical Sources of Air Leaks in the Home

Typical Sources of Air Leaks in the Home

A gateway drug is one that is habit-forming, and while not addictive in and of itself, it may lead to the use of other addictive drugs.  For example, many have maintained that marijuana is a gateway drug leading to other illicit and more harmful substances.  For HVAC contractors, could adding insulation be a gateway drug toward full involvement in home performance contracting?

 

Adding insulation is one of the most beneficial things you can do to make a home more energy efficient.  Take a look at a Manual J calculation from one of your recent retrofit jobs.  (You do run load calculations on your homes, don’t you?)  Run some simple calculations to see what the addition of insulation would do for the homes total heat loss/gain?  This additional service in your company could provide an ideal way to increase your labor productivity, (billed versus paid hours) or to increase capacity by adding new people to perform this function.  Before making this plunge however, you need to do your homework.

 

The first thing to realize is that you are not just getting into the insulation business, you are getting into the business of making the home perform better.  That means finding and sealing leaks in addition to insulating.  Sealing air leaks means stopping air that comes through your homes envelope – outer walls, windows, doors and other openings.  This will lessen the pollen, dust and insects entering the home, while reducing outside noise and providing better humidity control.  According to Energy Star, most homes in the US do not have enough insulation and have significant air leaks.  They maintain that a typical home has leaks that average the equivalent of having a window open every day of the year!  When your customers understand this, they are incentivized to do something about it.

 

You also have to prepare the employees within your company for this new capability.  Sales staff need to be trained on how to offer insulation and air sealing, while getting their buy-in to do so.  Simply mandating that they attend training and start offering these new services will not get the job done.  Once they understand the benefits to both their customers and themselves however, they will be more inclined to seek out these opportunities on every sales call.

 

Similarly, your technicians need to be trained on the proper techniques and tools to be used when sealing and insulating a home.  Organizations such as Everblue offer a BPI Weatherization Certification Course where students can learn in a certified environment.  Learning about the types of insulation to be used in a given application will depend on each homes individual needs and climate/location.  Finally, your scheduling staff must be trained on what is required in order to properly stage insulation/air sealing with equipment installation.

 

By successfully adding this capability to your business, you will have opened the door toward becoming a true home performance contractor, as opposed to a company that merely installs heating and air conditioning equipment.

 

Typical Sources of Air Leaks in the Home ~ courtesy of Energystar.gov

Image courtesy of Energystar.gov

 


Start off the Year with a Vow to Improve Customer Service Skills

Start off the Year with a Vow to Improve Customer Service SkillsWhenever there is a discussion about customer service, your first thought likely gravitates to an interaction between your service technician and the customer.  While that is not the only interaction, it is the obvious one.

 

Don’t forget about the exterior of your building.  If a customer who is in the market for your products and services were to drive past your business, would they be more, much more, less or much less inclined to call you because of that interaction?  The same can be said for a customer who comes across one of your company’s service trucks, as well as one who calls your office or visits your website.  All of these have the power to bring potential customers closer…or push them away.

 

Let’s go back to that obvious one – your company’s service technicians.  Perhaps like no other, they have the ability to bind your company to the consumer in a way that will bring them back for many years if done correctly.  However, good customer service is a discipline that is regularly practiced and backed up with ongoing training and accountability.

 

Treating the customer equitably and with understanding and empathy is a given.  If your technicians are not going to do that, they should not be working for you.  This is the cornerstone of building trust in a long-term relationship.  Beyond that, they need to look and sound trustworthy.  It goes without saying, but your techs need to have a neat and clean appearance, and providing company issued clothing sends the message that you deem this important.  What about piercings and tattoos?  Feelings about that vary by owner, but remember – the customer is whom it matters to, not the service technician.  Good communication skills should also go without saying, but part of that means training your techs on how you want them to present problems and opportunities to the customer – and how to handle irate customers.  We all like to use technical terms and industry jargon when talking with each other, but the customer likely won’t understand any of it – and may be too embarrassed to let you know it.  By the same token, don’t talk down to your customer either, they may know more about the subject then they let on.  Make sure to pick up on cues for lack of or understanding, and take the time to answer their questions completely.  Rushing through an explanation or looking at your phone will let them know that the schedule is more important than they are.  Finally, treat the customers property with the same respect as you would your own.

 

By re-dedicating your company to these core behaviors, you can create a competitive advantage that customers will pay for!

 

Picture courtesy of SteveDiGioiacom


Flat Rate Pricing Is So Easy A Caveman Can Do It (Part II) – by Mike Hajduk

cmeicdiIn last week’s blog we talked about a scenario where a contractor was losing money in their service department, and did not want to raise rates because customers were already complaining.  We ended that blog by saying while it might make sense to shed a department that was losing money, that may not be best for your firm in the long run.

 

The answer is not to shed service, but rather charge enough to make money in service, and the way to do that is by flat rate pricing the service rate.  This way it takes the focus of your company away from the “per minute” rate and puts it on the quality of your company.

 

Contractors have told me their customers want:

 

  • Prompt service
  • Thorough service
  • Things fixed right
  • The fix stays fixed
  • Fair Price

 

You cannot do the first four by undercharging your customer. And just what is deemed to be a fair price to the consumer? When you offer the customer a $65 or $70 per hour rate that is BELOW cost in many situations, they hoot and howl about the rate since THEY DO NOT MAKE THAT AMOUNT OF MONEY IN THEIR JOB!  And if they do, they sure don’t want their pool guy to make that amount!

 

The only way to charge your customer is by quoting them a single amount for the entire job that includes all labor, parts and expenses and do that before the repair is performed. In the construction or remodel part of your business it’s called a quotation. In the service department it’s called Flat Rate Pricing.

 

Flat Rate Pricing is advantageous because the customer doesn’t nit pick your hourly rate, what you’re charging for the part, your tech taking a call on his cell phone or having a smoke. Again, it’s the ability to focus your company on the quality delivered, not on the per hour rate that you are charging.

 

So now you can go up to an hourly rate that is ABOVE your breakeven. You can now make a profit on what you sell. But there are other financial benefits to flat rate pricing.

 

Each flat rate repair has a time allotment that is based upon what a journeyman tech would take to do a repair under normal working conditions, with a little time added for working conditions. If the tech finds 2 or 3 items that need work, there are economies of scale because the tech should be able to do all items in less time.

 

Let’s look at a service scenario. A tech goes to a home in response to a noisy pump.  The tech finds that the bearings on the motor are bad but also finds the burners on the heater need cleaning and the time clock mechanism has rusted to the point of  keeping the pump running continuously.   In a time and material scenario the tech goes to the house, changes the pump and then goes on to the next service call. At $75 per hour the contractor billed out $304 for the motor and $75 labor for an invoice total of $379.

 

In a flat rate scenario, the tech charges the customer a diagnostic fee, takes the time to thoroughly analyze the entire pool and spa system, and then makes recommendations for all repairs. Now the repair is thorough, professional and gives the customer options to buy repairs suggested because of the pool pro’s professional diagnostic. With finding the dirty burners and time clock mechanism, the repair is larger and done along with the original reason why he was there, the motor. Now the call went to $786, taken from the flat rate manual based upon $100 per hour (not a rate shared with the customer) which includes $391 for the motor, $100 for the burner cleaning and $246 for the time clock mechanism, PLUS the $49 for the diagnostic. This repair yields a significantly higher margin. Now the service company makes a profit!

 

Good news, right?  Well the better news is that the customer PREFERS the flat rate scenario because you gave them the option to accept or decline the repairs before the job was started and they fully knew how much the check amount was that they were going to write before they committed. This is far preferable to the open ended way that time and material contractors charge.