My Service Call Pricing Dilemma - ResidentialSystems.com

My Service Call Pricing Dilemma

We try our best to set expectations and prevent any surprises. Before a service call is even scheduled, a client is informed of the costs associated, and they must approve them in writing (via email) before we will send out a tech.
Author:
Publish date:

I was on a call with a colleague with Philadelphia the other day, and I asked him what drives the most service calls other than cable company equipment. His answer (mostly home automation—lights, shades, and HVAC) wasn’t what surprised me, but instead his comment that his clients would rather call him than the electrician who charges “$200 just to step inside my apartment.”

I don’t think I had ever heard it expressed quite so brazenly and openly by a client, but that right there is a huge issue for our industry. Why is it that clients think we will come for free when they assume that the plumber or electrician will charge?

Is it because when it comes to AV their point of reference is the cable company, and they usually come for free to fix issues because, let’s face it, it is usually their gear causing the problem? Is it because they equate our industry with the alarm/security industry where not only service calls, but often initial installs are free because of the RMR generated from those businesses?

Image placeholder title

ThinkStock Image 

The why isn’t quite as important as the “so what do we do about it, Todd?” That answer is not so clear cut. We have several policies and procedures in place to ensure clients are aware of the charges for service calls, and we spell out what is included in the initial install and what isn’t, both for customers who opted for our service plan and those who did not. For example, for non-service plan customers, we will provide no-charge service for the first 30 days after an install is complete as well as for removing and reinstalling any hardware that is still under manufacturer warranty and needs to be sent out for repair. Anything that is not within those specific circumstances, however, is not covered and will be charged at our prevailing service call rate.

Unfortunately, too many times something goes wrong after 90 days (it could be as simple as an IR emitter falling off of the cable box or the TV.) Even with a reduced service fee, we still get questions and complaints along the lines of “Your guy was only here for 20 minutes. Why am I paying for a full hour?” or “That shouldn’t have happened, so why do I have to pay for it?”

Sometimes if a client is being very patient and cool about the timing of the service call, and we can wait until we have a tech in the neighborhood, we will waive the fee if it is quick and easy. But even in that circumstance, we still issue an invoice for the full amount, with an offsetting deduction. Then we send it to the client with a $0 balance, just so they know there was value to what we did and so we have it in our records. I have had clients complain even about a $0 invoice saying they felt we were being petty and were trying to not-so-subtly hint that we did them a favor (why yes, that is exactly what we were doing!)

We try our best to set expectations and prevent any surprises. Before a service call is even scheduled, a client is informed of the costs associated, and they must approve them in writing (via email) before we will send out a tech. That has helped quite a bit, as now there are no surprises and no one can say they didn’t know there would be a charge.

This doesn’t mean that clients still won’t complain and won’t be frustrated with the cost, but at least they are aware. I don’t think we’ll ever be able to avoid having clients complain about service fees. Going back to the initial example of the electrician, clients do complain and are frustrated by the electrician’s service fee costs, but they pay it because they need their electrical work fixed, and they can’t do it themselves. Maybe that is part of the cause as well—electrical service is a necessity, while home automation and AV are not.

The one service call complaint we rarely hear is about networking; clients seem to intuitively realize that this is very complex (maybe because they know there are dedicated IT people at their companies who deal with networking) and because it is now a necessity of life.

Are you all seeing similar challenges with charging for service calls? For clients who are not on a service plan, how do you handle it? And for those of you who do not over a service plan, what is your strategy for handling clients who think your service calls should be free?

Related