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Selling Service Contracts with Teeth

The number-one complaint from integrators who are successfully selling service contracts has been that they waited too long to start selling them.

The number-one complaint from integrators who are successfully selling service contracts has been that they waited too long to start selling them. As technology continues to evolve at a manic pace, it is up to you to find effective ways to service each of the components you install and integrate in order to ensure reliable performance. Service contracts provide not only the means to secure an ongoing relationship with your client, but they also proactively protect their investment.

Some of your clients will immediately embrace your service contract option, some will ask for changes, and others will pass altogether. This is normal and to be expected as one single package will rarely meet the needs of all clients. Learn from the feedback received during the sales process, and then tweak your offering accordingly.

At First, Start Small. A basic service contract is relatively simple to put together, and can include a simple checklist of items that can save you time and money while providing real value to your customers. Some examples for this could include services such as an annual twohour inspection and basic calibration, an hour of firmware upgrades, a VIP call in line, access to remote support and service, or a basic remote monitoring solution. Once established, you can gather feedback from clients and utilize it to build a more robust service contract over time.

Know Your Service Costs. Even a basic service contract structure requires a thorough understanding of associated service costs, which is a healthy exercise for any organization to go through. Once costs have been determined, you can establish the services you intend to offer, and calculate your desired margin and the prices you will need to charge for each service tier. It is not uncommon for an integrator’s base service contract program to be based on a fixed price while their higher-end contract is based on a percentage of the total system package price.

Create a Name for Your Contract. Not surprisingly, titles are important. Thus, many integrators have found that they have had greater adoption rates when calling the service or maintenance contract something similar to a “Preferred Client Care Program.” This provides the client with a sense of protection and security. Be careful, however, not to employ excessive fear tactics. Instead, simply illustrate the benefits and costs savings, and you will have far greater success.

Marketing, Training, and Roll Out. Finally, create compelling marketing material, train your sales staff, and roll out the program to your customers. Be sure to present these new services to your previous customers and those with whom you have not interacted with recently. Review the equipment they have, make suggestions for upgrades, and perhaps add remote monitoring and support that provides insight into the connected equipment’s health and status. Take advantage of the opportunity to show them something new, to assist them with any issues they may be experiencing, and create a new transaction. Show your customers that you care, and you may be pleasantly surprised by their reactions.

Michael Maniscalco ([email protected]), ihiji co-founder and vice president of technical operations, served as one of the principal architects of invision, the company’s cloudbased real-time remote systems monitoring and support solution.