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Contractors have always faced a certain amount of unpredictability.  After all, you can’t control the weather, can you? 

The pitfalls of a seasonal industry, however, are not the only things you need to guard against these days.  The fact is, a change in our industry is sending warning signs throughout the replacement market.  Indeed, something’s happening in your customer base that you may have not even realized. 

With increased competition, contractors are facing the pressure to offer longer warranties — sometimes for as long as ten years.  These are a great benefit when closing the sale, but the downside is that they eliminate replacement sales for a decade.  In smaller or hotly competitive markets, these warranties, which are fabulous for gaining customers, are cutting the “heart” out of the replacement market as each day passes.

So, do you give up and call it a day?  Of course not.  The savvy contractor looks for the viable, profitable alternative.  And the only logical solution is to pursue customer retention programs that create massive streams of reliable income and the opportunity for upselling.

That’s where a Maintenance Agreement Program comes in.  Offering maintenance agreements to your customers ensures you will position your business above your competitors by:

  • Establishing a more predictable profit center.
  • Increasing your ability to keep good employees profitably active in the “off-season.”
  • Building and maintaining a retention rate other contractors only dream about.
  • Providing yourself a “built in” mechanism for contacting and visiting your customers multiple times a year — keeping your name foremost in their minds for future sales and referrals.
  • Developing an ever-expanding customer base that funds itself and pays huge profits — which is much better than paying for “acquisition” customers who are less loyal and price-shop more often.

A maintenance agreement takes your technicians into your customer’s homes two times a year for a full system evaluation, for which you’ll be paid.  As an additional benefit, you’re reminding them of your professionalism and value while increasing loyalty.

The old school of thought has been that if you earn enough money during the busy seasons, you can coast through the slow seasons.  But with changing market pressures, that “given” is no longer applicable.  In fact, unpredictable times can have you walking a fine line between turning a profit — or turning and running. 

Because Maintenance Agreements provide year-round work and cash flow, they are very important for a company’s financial health.  Imagine being able to start the year knowing you’ve got appreciative, high-value customers with a pre-paid service that only needs scheduling!