Rodney Koop
Contributing Writer
The New Flat Rate
So often in HVAC, plumbing and electrical work we want our technicians to turn leads over to our sales team for the purpose of getting those equipment or home renovation sales. However, the fly in the ointment is the loss ratio, sometimes called the closing ratio. Many of you may agree that a nice fat service repair is much better than a customer who chooses to buy a replacement elsewhere. So where is the balance? It’s simply following the Indisputable Rules of Selling.
Rule #1, “Everybody hates it when you try to sell them something.” So let’s avoid sending the customer on a shopping spree with our competitors but still get the turnovers when they are applicable. And this applies to the new add-ons such as home performance items like insulation, windows, duct sealing, etc. Not just to HVAC replacements, but of course it works there also. How do we bring new information into the mix without distancing our technicians by “turning on the sales resistance?”
Simple. Move the discussion to the end of the call. You may have seen how we do this on the YouTube video called “Service Agreement Magic” that I did for the HVAC and plumbing companies. It’s easy enough to find on Youtube.com but I’ll explain the concept here. It’s really the method I learned from watching the cashier’s at Lowe’s and The Home Depot. Have you ever timed how long it takes them to present the option for you to buy an extended warranty? I have timed it, and its 5.6 seconds, and get this, it rises a total of 6 more seconds on average if you have a question like; is that for one year or two years. You may notice that it is strikingly similar to the method developed by the expert marketing department at McDonalds which allows 1.7 seconds to say, “Would you like fries with that”.
So how do they do that?
When the customer has accepted your diagnosis and signed to approve that you go ahead with the work it signifies that they have just placed their trust in you the technician. At that point something happens to the customer. The stress of having to find a serviceman and meet up for the service call now dissipates, It is like placing your feet in cool water at the end of a long hike on a hot day. The customer now likes and appreciates you more than you could have imagined.
Disclaimer. This is assuming you didn’t do anything to turn on the customers’ sales resistance and that you did not offend them with pricing that appeared unreasonably high. There are ways to stay well within these boundaries.
So now they have signed your ticket and you are doing the work, remember now you have earned trusted advisor status, so how do you use that new status to benefit you and your customer? First let me talk about the turnover or the opportunity to talk about either replacement equipment, or additional equipment like water conditioning, or humidity control or a whole house generator. The turnover if handled like McDonalds or The Home Depot would go like this, “Would you like a 2 yr. plan for $19.95 with that?” Well it actually does go like that doesn’t it.
The advantage that McDonalds and The Home Depot have is that you have already chosen your purchase and given your order. Perhaps at McDonalds you have just asked for a #3 combo and the response is “would you like to supersize that for an extra 99cents.” Or at The Home Depot you are already at the cashier with your chosen items placed on the counter and a line of customers behind you when the cashier asks; “would you like the 2 year replacement guarantee for the drill for an extra $19.95?” Remember all the customer has to say is “yes” or “no” to finish out the transaction. So how can we implement this model for our service business? Well all we need to do is perform the service or repair that the customer asked us to perform. And while we are doing that we can and probably will notice other work that would benefit the customer. Because you are now a trusted advisor then simply advise with all of the information necessary for a decision in one simple sentence like this.
Example #1. Service agreement, “Mr/Mrs. Customer I “noticed” that you don’t have a service agreement with our company, it’s only $15.95 per month and allows us to come out a couple times a year and check for problems like this. Is that something you would be interested in?” I can do that in 8 seconds and they can say yes or no. Will you get just as many service agreement sales as before? That might be a good question to ask The Home Depot. You will likely get more and guess what; the customer will not expect or ask for a discount on today’s repair. But either way how easy can that be for your tech?
Example #2. You want to turn over leads to your home performance team for an energy audit or a whole house generator offer. Once again after you have either finished the repair or at least are well into the repair you have earned the right to “notice” something. Mr./Mrs. customer I “noticed” something up in the attic, and I didn’t know if you would want me to mention it or not.” Customer responds yes or no. If yes you say something like this. “Well I see that your attic insulation has settled and pulled away from the structure and thought maybe you might like our energy team to do a courtesy inspection. They might be able to help you plan for some serious energy savings, is that something you would be interested in?” If you charge for that inspection just insert the price into the questions “and it only costs $499 but usually saves much more than that is that something you would be interested in?”
Now that you have earned their trust they don’t look at your statements as trying to sell but as trying to help.
Example #3. The add on repair such as sealing air ducts. Again after you have finished or at least begun the repair. “Mr./Mrs. Customer, I just noticed your air ducts are leaking up here in the attic, would you like me to run a quick check to see how much they are leaking?” If the answer is yes then say you will do it as soon as you finish the repair and that it will only take a few minutes. You could do a blower door or duct blast test but that is really something you would turn over to the energy audit team so maybe for now you could run the fan and take a smoke pencil to see where the leaks are. With a little training in air balancing you could also do a couple quick calculations with a flow hood. I have sold more with nothing more than a pencil, but that’s for later. Once you have tested then bring all the information to the table in one sentence. “Mr./Mrs. customer, I did a quick check and it looks like about 25{938cd9e8dae860e800efc538277d4f7684e6f6981618ba70d1c34357a53c2e1f} of your airflow is ending up in the attic, I don’t know if you want us to fix that it usually runs about $2880 (give them your price) to do a clean/seal/sanitize of the system would you like us to take care of that for you?” That is about 30 seconds of dialogue. How simple could it be?
Selling in Seconds sounds too simple to be true. And maybe it is, but think about how much business is transacted in just a few seconds. How much have you paid for when asked a simple question?
Can you talk longer, sure but first test this on a few calls and see what happens. The first time I did it was about 15 years ago, and I was amazed at how easy it could be.
What if it doesn’t work? Well if you have something better working now then keep doing what you are doing. But if not or if what you are doing takes too long then why not try something new.
Rodney Koop/ Founder The New Flat Rate