The way I see it, all of our businesses will soon fit into three categories:

• Attractive acquisition targets, worthy of substantial offers from one of these organizations.
• Businesses that are not for sale, but are not only viable, they are competitive and able to sustain their market position, keep their customers, grow and remain profitable.
• Businesses that are not sufficiently profitable or well run to either be purchased or to effectively compete with the well–funded, large mega-companies entering the marketplace.

If your company fits into the first category, you are fortunate and may need to face a challenging decision in the near future. Sell or stay? The good news is you have a choice. It’s simply a matter of deciding whether to sell — and for how much. Cash or stock in the new mega-company? However, the window of opportunity is not going to be open for long. And you may not have the same opportunity again for some time, so your decision is both important and timely.

If your company falls into the second category, you have a new competitive environment to consider: Larger, well–capitalized companies, which may be planning to penetrate your market, soliciting and possibly taking away your customers. The assumption that our businesses will remain untouched and unaffected by the wave of consolidations is an unrealistic one. We face a new barrage of competition. What plans have you made to face the invasion?

The Third Category: The companies in the third category — not strong enough to be bought or viable enough to compete — are the ones that worry me. It comes down to this dilemma: change or perish. Without significant changes in the way these businesses are run, they face a bleak future. When faced with a well– funded, professionally managed organization, the term “competition” is redefined. These growth-oriented companies have aggressive strategies in place to dominate their markets, backed by corresponding advertising budgets and promotional skills to do the job. Watch out.

In years past, companies that have had marginally successful marketing efforts and weak profitability could squeak by, hoping for a better year next year. These are the companies that are not selling service agreements, haven’t switched to flat rate, or haven’t sufficiently trained their technicians or call-takers in effective customer service. Now, however, the time is up for just squeaking by, hanging on and hoping for a better next year. Those companies must either become a top competitor by serving their customers better and generating more profits or face an inevitable decline in business.

Let’s review the practices that I think will have the biggest impact and help turn these businesses around quickly. Your concern now should be to get the most out of your service team, earn higher margins and reduce your overhead.

Phone Flaws: When you calculate the cost of routine Yellow Pages advertising, publicity, etc., you’ll discover that you “pay” $40-$50 for each call that comes in. What’s more, you pay that cost whether the caller schedules a service call or not. The best way to make sure you’re not wasting your money is to train your call-takers, or CSRs, to use a script that is proven to produce business. By following a strong script, your CSRs will avoid some of these common problems.

First, answer the phone on the second or third ring. Any sooner and your company will appear to be desperate for business. Any later and your potential customer may hang up. Next, avoid putting, or keeping, customers on hold. These folks will also soon hang up — only to call someone else.

The best way to get a service call booked is to avoid price quotes. Only service techs can estimate a job, and only when they’re at the customer’s home. Rather than answering pricing questions, your CSRs should ask questions such as “How do you spell your last name?” “What area do you live in?” “When is the best time for a service tech to arrive?”

Incorporating a diagnostic fee into your work is another way a CSR can deflect pricing questions, and perhaps more importantly, book a service call. For example, your CSR could say: “The service tech will come out, take a look at the problem and let you know what’s involved. The diagnostic fee is only $29.50 and we’ll apply that toward the repair, it’s not a separate charge.”

In addition, flat rate pricing becomes extremely effective handling customers over the phone. Have your CSRs tell customers that your company “charges by the job, not the hour, which saves you money.”

Technician Training: Not only will your CSRs find your flat rate pricing easier to deal with than hourly rates, but your technicians will too. By using a quality flat rate manual, they will quickly find pricing jobs easier and less stressful. The manual itself presents a more professional image. Customers are less likely to question how the price was generated.

Here’s a few additional tips to help your techs sell services once they’re in the door:

• Look in the mirror. Most of my techs carry a mirror. They look in it before facing a customer to be certain their appearance is acceptable. They are professionals and they look and act like professionals. How do your techs look when they knock on your customer’s door? Are they in a clean uniform? We also issue business briefcases to our techs. Inside the briefcase is a Polaroid camera, the tech can use to show the customer exactly what is wrong without the customer having to peek in dirty, dusty, hard-to-get-at spaces.
• Offer full service. Too many service and repair businesses are operating with the wrong strategy. Techs are usually encouraged to get the job done as quickly as possible so they can get to the next customer’s home and do the same thing. Our techs frequently complete only a few calls a day — but they fix everything that is legitimately wrong in the customer’s home. How would you react if you took your car in for an oil change and the next day you experienced a brake failure due to leaking brake fluid — something the mechanic should have noticed?

An economical and effective way to scour the customer’s home for additional service and repair jobs is to offer to place stickers printed with emergency steps throughout the customer’s home. Customers will appreciate the added value and your techs get to check everything to be sure it is operating properly and safely. Use a bright color for the sticker and include your company’s name and telephone number. Stickers allow you to save the customer the cost and inconvenience (and possible safety risk) of another service call. You, of course, get more business and make more money after the customer calls you for the needed repairs.

Make no doubt about it. The clock is running. The consolidation of our industry presents yet another changing aspect for our businesses.