I spend a lot of time reviewing, installing and configuring home networking products for our industry. What I realized after attending the CEDIA Management Conference this past March is that the benefits of getting to know the network of CEDIAs business leaders is just as important to the success of our business as our technology knowledge.
Listening over a period of three days to the best practices of my industry peers has given me new insights that will add immediate value to our custom installation business. Weve learned over the years how to design and install some very sophisticated home integration projects, but weve havent given equal time to designing and integrating new business practices for our own company to perform at its best. The CEDIA Management Conference was the perfect educational offering to aid us in the development and integration of specific best business techniques.
Some pearls of wisdom that I retained and brought back to my business include:
Eric Bodleys Service Contract Offerings. In a business where many of us look with envy to the recurring revenue streams of our security installation peers, we can all look at our own integration accounts as fertile ground for recurring service revenue. The challenge is how to structure these service agreements so that they have value to both the client and the integrator. Eric has developed three service contract templates for each of his completed integration contracts that define product and labor service agreements that are invoked after the 90-day “no questions asked” grace period. The first is a three- or five-year plan that covers service calls for all of the installed equipment (on either a prepaid annual plan or discounted hourly rate plan), the second is what Eric calls his “Major Medical Plan” which has the same terms but only covers the key, expensive products in the installation. The last agreement is one that states that no services are implied or expressed after the 90-day grace period and that all service calls are billed at the prevailing rates. The customer must sign one of these agreements. For projects that linger on forever with ill-defined service-charge agreements between the client and the integrator, Erics service agreements can make the difference between a profitable job and one that drains away all of your profits over time.
The Methodical Drive for Referral Business. We put our heart and soul into our large integration projects. We practically live with our customers for a month or two (or longer) after they move into their new home to make sure everything is working the way it was promised in our proposal. How do we turn these account completions and exits into new account entries? My industry peers had the following tried and true suggestions:
o Have you just finished building a phenomenal home theater for one of your clients? Ask them if they would let you host a small party at their home for a few of your key prospective clients so that they can see what a great job you did and hear it from your satisfied client.
o Send a Thank You card at the six-month or one-year mark after an installation with the simple request that if your client is unhappy that they should call you and if theyre happy about your work they should tell others.
o At the completion of each job when final payments are made (and perhaps a bottle of fine wine shared) ask for one to three referrals.
o Participate in AIA (American Institute of Architects) and ASID (American Society of Interior Designers) functions. Take out an allied membership in these associations and get to know the key personnel in your chapter area.
Taking It to (and from) the Bank. There is no need to reinvent the wheel. The CEDIA IdeaBank (at www.cedia.org) is where many of CEDIAs best and brightest companies have contributed their proposals, business plans, job descriptions, labor estimates, service agreements, etc. for other CEDIA members to freely download and adopt for their own personal businesses. CEDIA is all about making their member companies more successful, and the online Idea Bank is an important membership asset that is available seven days a week, 24 hours a day.
In these columns I am always an advocate of open standards and open platforms over proprietary hardware and software solutions. In the long run, these solutions are usually in the best interest of our customers. CEDIAs members act in this same spirit of open communication and sharing of ideas. Attending this years Management Conference was a clear indication of this mutual cooperation, and it bodes well for the ongoing spirit of camaraderie and health of our industry.