Building Customer Loyalty

Last month we discussed responding to customer complaints and using a complaint as an opportunity to build customer loyalty. A business should not wait for an opportunity to garner customer loyalty. It must be an every day goal that is built into how you do business. Here are a few tips for reaching that goal.

Strive to Give Consistently Good Service
Most businesses these days know that being consistent in your service offerings and pricing is one of the reasons that Flat Rate Price Books make sense. Providing consistently good service is critical to maintaining and growing your customer base. Having a customer who does not feel that he got the same level of service from you as a friend or neighbor did, jeopardizes your relationship with both customers.

Show your Customers that You Know Who They Are
Simple things like knowing when their last service call was, and what the problem was can mean a lot to your customers. Remembering their names, and the names of other people in their lives can turn your business relationship a bit more personal. You become the one they call first when they need help.

An easy way to promote this type of connection when you have thousands of customers, is to keep notes about the customer in your database. When you transmit the dispatch ticket, include a couple of personal details. This makes it easy to remember names and dates, and can make the customer more at ease with your business.

NSPG Referral ProgramImplement a Referral Program
Word of mouth is often the most effective form of advertising for small businesses. Leaving a card with a small percentage or dollar discount can spur your loyal customers bring in new customers for your business. Make it easy for your customers to give referrals, so they have no excuse not to do it.

Treat Your Employees Right
Happy employees who feel engaged in your business are much more likely to treat your customers right. An employee who views his role as simply an employee, and not a valued part of a team, is more likely to view interacting with your customers as a nuisance than an opportunity.

Everyone Can Become a Frequent Flyer
Getting current customers to call again is often much less expensive than finding new customers. Pass along some of those savings to your repeat customers to keep them coming back. Giving a small discount or free gift to frequent customers can make them feel good about doing business with your company, and can help cement the relationship.

In most markets, you have a large number of competitors. Offering a high quality, reliable service experience is not enough to keep your customer base growing unless you can spread the word. Why not have you customers help? Making a coordinated effort to establish and maintain a high level of customer satisfaction can be just what you need to improve the effectiveness of your marketing efforts, and build a stronger customer base.

If you do build a great experience, customers tell each other about that. Word of mouth is very powerful.
Jeff Bezos, CEO Amazon.com

 

 

Mike Conroy of NSPG is a flat rate implementation expert.Mike Conroy

Give Mike Conroy a call. He can quickly walk you through the business basics that you need to help make your company more consistently profitable, and increase the value of your business. Mike has years of experience helping companies set their own profitable prices, respond to price complaints, track performance, implement and fine tune Flat Rate systems, and improve profitability.

Take advantage of Mike’s experience working with hundreds of companies like yours to help you achieve your own business success.

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Whether you’re looking to Rise Above the Competition in business or kite boarding, Mike Conroy should be your first call.

Mike can quickly walk you through the business basics that you need to help make your company more consistently profitable, and increase the value of your business. Mike has years of experience helping companies set their own profitable prices, track performance, implement and fine tune Flat Rate Pricing Systems, and improve profitability.

Take advantage of Mike’s experience working with hundreds of companies like yours to help you achieve your own business success.

For you kite boarding fans, you can find Mike on the Jersey Shore.

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Numbers Cruncher Cost Breakdown

Numbers Cruncher Job Cost BreakdwonNumbers Cruncher software includes an automatic Job Cost Breakdown and cover letter that can make responding to cost complaints less time consuming and costly.

Enter a few details about the job, and Numbers Cruncher uses your actual numbers to create a job cost breakdown and cover letter automatically.

You can save hours of work compiling and organizing the costs for a job. This feature complements the easy labor, overhead, and breakeven calculators built into Numbers Cruncher software.

Visit the Numbers Cruncher web site for more details, or call 800-841-8542.

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Should You Give a Price Breakdown?

Flat Rate Cost BreakdownOne of the issues that every service business has to deal with is the customer who thinks he paid too much, and demands to see a complete breakdown of the costs for the job.  This infrequent annoyance inevitably leads to the dilemma of revealing your costs to a customer, or alienating the customer and risking the loss of business or worse.

This situation is one reason why many companies move to Flat Rate from T&M.  With Flat Rate, your proposals and invoices give only a price for the complete job, so the breakdown issue rarely comes up.  But, when it does, you need to respond in a consistent way that works for your business.

For many companies, the response is that the price is for the entire job, and they cannot break out the individual costs.

Since the founding of NSPG, we have subscribed to the policy that industry leader Frank Blau advocates so strongly for.  If the customer wants to see the cost breakdown, give it to him.  Lay out the details so that he can see what providing the level of quality he demands actually costs.

When you install a new toilet, or a new 240V circuit, the customer has no idea what makes up your costs.  They don’t think about the many items involved in paying for the technician, or the myriad items that contribute to your overhead.  They don’t think about insurance, vehicle costs, utilities, office staff, and all the other items that make up your cost of doing business.

So, as Mr. Blau recommends, give it to them, in detail.  Print them a list that shows your labor cost, your overhead, even your profit.  Be sure that the list is detailed, and be sure that you explain to them why the major items are as expensive as they are.  After all, everyone can relate to high insurance and gas prices.

If you’re still a Time & Material business, this can be a bit more difficult than with Flat Rate.  Most T&M shops mark up their material costs to keep their hourly rate low.  They shift a significant part of their costs and profit to the parts by marking them up sometimes as much as 300%.  This is a big problem when your customers can find just about anything for sale on the internet.  They will be able to see that you’re charging a lot more for your parts than they can buy them for on line.

If you’re flat rate, you don’t really have this problem.  You don’t need to mark up your material.  You can make your profit based on the hours you sell rather than on the material you sell.  This can even out your profitability over all types of jobs you do, and can reduce the urge to up-sell materials to try to increase your profitability.

But, let’s get back to the cost breakdown issue.

Flat Rate Cost BreakdownThe most likely reason that the customer asks for the breakdown is that they think you overcharged them.  Your response should combine the detailed cost breakdown with an explanation of the value your company brings to the job.  Highlight the quality of your work, the warranties you provide, the value of your insurance in case someone is injured on the job, the reliability of your service, and the many other benefits that running a quality, profitable business includes.  Once the “hidden” costs of your service are revealed, the customer has a legitimate reason to cool off and accept the value that your business offers.

You CAN be ready for when you face this issue with one of your customers.

If you decide to reveal your cost breakdown, minimize the cost to respond to this type of request by setting up a spreadsheet template that includes all of your costs that you can quickly customize for the job.  Or, use the built in breakdown in software products like Numbers Cruncher.

You can’t avoid this type of situation, but you can minimize the cost and the damage.  A little preparation plus the courage to defend your business can reduce the stress and risk you face.  Who knows.  You may be able to convince the customer that they made the right decision when they chose your company for the job.  You could earn a loyal customer who respects the quality and integrity you bring to the job because of the professionalism you display in dealing with his complaint.

_________________________

Give Mike Conroy a call.  He can quickly walk you through the business basics that you need to help make your company more consistently profitable, and increase the value of your business.  Mike has years of experience helping companies set their own profitable prices, respond to price complaints, track performance, implement and fine tune Flat Rate systems, and improve profitability.

Take advantage of Mike’s experience working with hundreds of companies like yours to help you achieve your own business success.
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Whether you’re looking to Rise Above the Competition in business or kite boarding, Mike Conroy should be your first call.

Mike can quickly walk you through the business basics that you need to help make your company more consistently profitable, and increase the value of your business. Mike has years of experience helping companies set their own profitable prices, track performance, implement and fine tune Flat Rate Pricing Systems, and improve profitability.

Take advantage of Mike’s experience working with hundreds of companies like yours to help you achieve your own business success.

For you kite boarding fans, you can find Mike on the Jersey Shore.

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Nexstar® is looking forward to seeing you at these upcoming tradeshows

Pumper Trade Show
March 2 – 5, 2011
Kentucky Exposition Center
Louisville, KY

PHCC National Trade Show
September 21 – 24, 2011
Hilton Hotel
Minneapolis, MN

Call Lisa Schardt or Bryan Martin to find out more!
Call 888.240.STAR

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Upcoming QSC Power Meetings

March 22-24, 2012
QSC Power Meeting XXXVI – The Westin Charlotte Hotel – Charlotte, NC

July 26 -28, 2012
QSC Power Meeting XXXVII – Hyatt Regency, Indianapolis, IN

For more information contact QSC at 800-533-7694
or quality@qsc-phcc.org

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Fear and Pricing

As anyone who reads this newsletter knows, NSPG is a Flat Rate Price Book software and printed books company. We know what people want in their books and how they want to set up those books. What they actually put in their books is often very different. The fear that business people have in charging a profitable price is apparent to us every day.

Most people in our businesses know that nervous feeling as we present a proposal to a customer when we get to the price.Most people in our businesses know that nervous feeling as we present a proposal to a customer when we get to the price. The fear of being challenged because the price is too high is something that every field tech needs to overcome. That’s where flat rate books that offer a range of separate Task options for each job can smooth out most price objections. The choice isn’t between that’s too expensive and do it. The choice is between options A, B, and C each with a different price and service level.

What we see every day is the different fear that the business manager deals with when it’s time to update his price books.

Often the response we get is that they will try to wait just a few more months before they print another set of books. They choose to continue to see their profits decrease rather than take the small amount of time needed to reprint their price books with new, profitable numbers.

We often remind them how much the price of gas has gone up since their last books were printed. How much material costs, health insurance, workman’s comp, utilities, and all the dozens of other components of their costs have gone up. Each of these items adds a small amount to your cost of doing business. Put together, they can add up to tens of thousands of dollars.

Can anyone really afford to lose that kind of money while they wait to update their books?

Sometimes our clients choose to take money out of their own pockets, and continue to charge their customers last year’s prices. As long as they can stay busy enough, the ever smaller profits they earn will allow them to scrape by until they get around to printing new price books.

Most of the time our clients take a hard look at the numbers, and realize that they cannot afford to wait. They calculate their profitable prices, and they print the new books.

And how do their customers respond to the new price books?

They just notice that they had a choice that saved them money and gave them what they wanted.They choose Task B because it saves them some money over Task A, and offers better benefits than Task C. They don’t even notice the price change. They don’t notice that the new price books give the business the few dollars more that it needs to keep running efficiently. They just notice that they had a choice that saved them money and gave them what they wanted.

Now, if you truly feel that your company offers good value to your customers and you’re making plenty of profit at exactly the price in you current books, then don’t print a new set of price books. But just about everything costs your business more today than when you last printed your price books. The fear that you should feel when considering new books is not that your customers will object. You should fear that your business will become unprofitable and weaker because you aren’t charging the right amount.

Your employees who don’t do a good sales job because they are afraid your prices are wrong could be right, but for the wrong reason. Out of date price books are a hazard to your business. If you’re books don’t reflect your real profitable prices, your employees’ future is at risk too.

We have found that the businesses that are confident in the value they offer their customers are willing to print that new set of price books when the time is right. They share that confidence with their employees, so they are not reluctant to sell the correct job to the customer. Balancing your profitability with the value your business offers can reduce the fear associated with your pricing for both management and your field techs.

So, if it’s been a while since you printed new price books, open up Numbers Cruncher and the Price Guide, and get your up to date books on the street. Be sure that your techs understand the value of the quality service you offer. This will translate into happier, more productive techs, satisfied customers, and a stronger business.

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NSPG Flat Rate User on Ask This Old House

NSPG User Scott Caron on Ask This Old HouseLong time NSPG Flat Rate user Scott Caron works with a homeowner to upgrade his electrical service from 100 to 200 amps on Ask This Old House.

Long Time NSPG Flate Rate user Scott Caron on this Old House
http://video.pbs.org/video/2186573603

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Mike Conroy - NSPG Flat Rate Price Book ExpertWhether you’re looking to Rise Above the Competition in business or kite boarding, Mike Conroy should be your first call.

Mike can quickly walk you through the business basics that you need to help make your company more consistently profitable, and increase the value of your business. Mike has years of experience helping companies set their own profitable prices, track performance, implement and fine tune Flat Rate Pricing Systems, and improve profitability.

Take advantage of Mike’s experience working with hundreds of companies like yours to help you achieve your own business success.

For you kite boarding fans, you can find Mike on the Jersey Shore.

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