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4 Keys To Service Contract Management Success

Service providers need to make the service contract management plan part of the sales cycle and sell benefits right from the beginning.

In fact, it’s one of the rules for success outlined in a recent article on CE Pro’s website that highlights how one audio/video vendor added $100,000 in annual service contract revenue. This article is a great refresher.

Here are the four strategies to follow.

  1. Mention service plans at point-of-sale: Don’t wait until the installation is finished to mention the availability of service contracts. Talk about multi-level service plans up front. Plant a seed with the customer.
  2. Don’t rely on the existing network infrastructure:Rip out the existing network equipment and install professional-grade equipment. Replace routers and Wi-Fi infrastructure. Add power supplies and reset all IP devices. Customers will immediately notice the difference in gear.“Most people have no idea how bad their Internet speed and service is until you give them a new network,” says Michael Pope, CEO of the Ohio-based audio/video vendor highlighted in the CE Pro article. “Now, we get big ‘thank yous’ from clients. If we ‘own the network, we own the client.’”However, at the end of the day, if a company wants to manage — or “own” — these networks, it must have the tools to support it. Field service companies need to invest in technology such as web based service software to support this business scenario or they won’t make any money. That’s because they’ll end up spending too much on administrative costs.
  3. Bill annually for network service:Send an annual bill for service plans. That allows the company to examine expenses at the end of the year and make any necessary changes to the cost of the service plan. The customers win, too.“The psychology of not handing them a bill after you have solved a problem is amazing,” Pope says. “There is nothing for them to be irritated about. You are doing all the same work except you just don’t hand them a bill.”
  4. Allocate service hours depending on system size: Varying the number of calls a customer can have for free based on system size is an excellent idea.

Source: CE Pro, November 2012

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