Service agreements (SAs) are essential to increase the value of your business, increase cash flow, improve profitability and reduce employee turnover. SAs increase the value of your business, as potential buyers usually value them above everything else. SAs improve cash flow because you get paid for services you haven`t yet provided. SAs improve profitability by increasing service sales, increasing accessory sales, and creating quality replacement sales opportunities. SAs reduce employee turnover because they allow managers to employ their employees at slower times of the year. Define the correct contractual conditions. Many home service contracts have a lifespan of 12 months – others operate month after month as a monthly maintenance contract (learn more about renewal guidelines). You want to find a directive concept that is aimed at owners who are willing to try a contract agreement, but do not want a big obligation. Although the specific format may vary from industry to industry, a recurring service contract (sometimes referred to as a service maintenance contract) usually refers to a document describing an ongoing agreement between a company and a customer. Do your due diligence.
Maintenance contracts should not be extended to owners until your team receives detailed information about their equipment and assets. If your company installs new devices, be sure to affix this tool-based contract and record the serial number in your digital records. Implement these 4 simple steps and experience an explosion of growth in your service contracts! Don`t be fooled by the title. Service contracts are one of the most important things your company can participate in. In fact, I would go so far as to say that your company should create a culture based on service agreements that makes selling your primary focus. What for? This is because selling service contracts leads to everything you want from your business. To sell recurring service contracts, here you will find some tips that you might find useful. For home service companies that are new to the concept of selling their services as an ongoing agreement, choosing the best time to broach the topic with customers can be a challenge.