Hi Steve,
We’re working on implementing a “Stay Beautiful” maintenance program for our commercial customers, and my boss suggested I contact you for some advice on how we might go about structuring it.
We’re looking for simplicity as we don’t overwhelm our sales staff or our accounting department and yet we want our customers to see the value in what we are offering.
As of right now we’ve started to design the program on three levels based upon cleaning frequencies. These options would be proposed to our current customers (as well as new customers) based upon their previous cleaning history, as well as the needs of their facility.
Our goal is to increase cleaning frequencies in between restorative cleanings that we finding ourselves doing far too often- this is particularly challenging with long standing customers who we are only cleaning for a couple times a year. They are typically on a budget, but we’re killing ourselves trying to get their carpets back in shape when so much time has elapsed between cleanings!
This is what we’ve laid out so far:
Level 1: Increasing cleaning frequency from 2x per year to 4x for the cost of 3 cleanings. (The 2 additional cleanings would likely be encapsulation on traffic areas.) The customer would receive 50% discount off any emergency spot cleanings. (Rather than paying the $150 minimum they would only have to pay $75.)
Level 2: Increasing frequency from 4x per year to 6x for the cost of 5 cleanings. (Again, the two additional cleanings would be traffic areas with encapsulation.) The customer would receive 1 free spot cleaning, as well as a 50% discount off any additional spotting calls. One free carpet protector application would be included.
Level 3: Increasing frequencies from 6x to 9x, or 9x to monthly for the cost of 8 or 10 cleanings. (Cleaning method would vary by client, but would be a combination of truck mount restorative cleanings and traffic areas/encap.) The customer would receive 2 free spot cleanings as well as 50% off additional spotting calls. Two free protector applications per year would be included
Our goal is to “tie up” our clients that we are continually having to resell our services to, as well as minimize our technicians time out at the job site by not allowing the condition of the carpet to deteriorate between cleanings.
We would offer a monthly pre-payment plan with the option of using a credit card or having an auto-payment from their checking account set up.
Our concerns are that this may be a little complicated for our sales staff plus it may not be suitable for every client. There is also the question of how to compensate our technicians for these jobs. They are currently paid commission on a piecework basis but with the varied cleanings (as well as the discounts) we want to be sure they continue to be compensated fairly.
Steve, I’d love to hear your thoughts on what you think might work for us. Or if you know of anyone who has implemented a successful commercial maintenance program across the board I would really like to know how they were able to go about it. My boss also has mentioned that some companies simply charge a set price per square foot to maintain the carpet all year. We are open to any and all ideas that can help us implement a successful program!
Thanks in advance,
Confused in Manhattan
Hi Confused,
Good to hear from you. It sounds like you folks have put a lot of work into this. My guess is it will go great. Here’s a few comments:
1. The basic concept of any “Stay Beautiful” program is getting people on a “painless” payment plan where you quit having to set up the job/get new permission each time. Or as I say at SFS you want to be like the “dumpster” guy- he doesn’t call you each time he dumps your trash- it just happens. (And he most certainly doesn’t come in every year to get a new contract signed! It is all on “auto-pilot”.)
NOTE: Especially with big corporations if you take a large one, two or three times per year BIG amount and break it down into a small monthly amount it likely may “fly below the radar” and your local contact may not have to get approval for it. GREAT!
2. My concern, Confused, with the “one size fits all” approach you’ve come up with is I doubt it is going to always be profitable for your company. OR on other jobs where you have more “gravy” built in to the account it may work better for your sales person to “sweeten the pot” by giving the client an even bigger incentive to go the Stay Beautiful route.
3. I assume you have pretty accurate production numbers on each commercial account and maybe even a sketch map, blue prints or even the “fire egress maps” for each job. (This is a HUGE advantage for you!) So how about if your sales person sat down and came up with three different proposals for each job BEFORE they went to see the account. They would pass them by your Operations Manager, Sales Manager or maybe even the company owner for pre-approval/suggestions on improvement before they leave the office. (This wouldn’t need to be real complicated- you could design a “template” that will work in most cases.)
4. Here is how I would do it:
a. Get all the production numbers/ current cleaning frequency/ maps or blueprints for the job AND how much the customer is spending annually for the work you do now with restorative cleanings. (If you don’t have all this date you most definitely need to download our free Commercial Pricing/Profit Analysis Log.)
b. Salesperson to briefly interview the actual tech or manager responsible for the job- this could even be done by email with a form to fill out. You are sincerely looking here for how you can give the client more “bang for their buck”.
c. Then the sales person should make a “site visit” and interview your account contact using our Commercial Carpet Analysis form. Be upfront with your prospect and explain you’ll be delighted to keep working for them as you have all these years. But you are now “introducing a new Stay Beautiful program of zoned cleaning where for the same or a little more investment your appearance level will be so much better.” (Clients love this approach and you’ll be “prepping” them for the eventual presentation by involving them now.)
NOTE: I realize, Confused, that this is a labor-intensive approach instead of just having a “one-size-fits-all” formula. But remember especially with your larger accounts you are making an initial sales investment now that should pay off for years to come.
d. Look at the “pool of money” your client is currently spending on an annual basis and come up with a much better proposal with more frequent cleanings based on “zoning” the job. For example, on an account you are cleaning three times per year now you might clean some areas only once per year, others stay at three times and then touch up the high traffic areas and food service areas monthly.
e. Calculate these cleaning scenarios at three levels- one with maybe a 50% increase in client billing, another at 25% and one at the same level they are paying now and divide them all into a monthly amount.
f. I (obviously) like the automatic withdrawal plan with either their checking account or credit card. But I’m guessing you’ll have more client acceptance by invoicing your business accounts on a monthly basis. (This is likely how their bookkeeping is already set up.) As long as you “back load” the bigger parts of the job later in the year you will always be “ahead of the game” if they quit the program!
g. Speaking of cancelling the contract we did not try to lock our customers in- instead we gave them the right to cancel at any time. You will find this will greatly relieve your client’s minds about signing an agreement and when you think about it- if they don’t want you there you won’t be and it doesn’t matter how “bullet-proof” your contract is! So we turned a negative into a positive by accepting the reality of the situation.
h. One key to all of the above is to push for “Open Access” as you have a key or can easily get into the establishment without having to make elaborate arrangement and/or ask permission each time. This shouldn’t be too hard since you folks already have gained the confidence of your clients over the years.
5. One reminder: Don’t get so wrapped in in what is best for your client that you forget to make money for your company! You will need to calculate what your minimum amount can be and also if your people will make money on each visit. One thing that will help is to fill out a Job Profile so any crew can easily do the job including lights, alarm codes, etc.
NOTE: I agree with you that encapsulation cleaning will be a huge part of sharpening your pencil with your accounts. In fact, the entire process I went over above is detailed (with tables and sample numbers) in Jeff Cutshall’s “Building Encapsulation Routes” Special Reports. I highly recommend you download it and by the way, just like everything on our SFS site- they are FREE!
Let me know how it goes.
Steve
PS Regarding your commission compensation arrangement this shouldn’t be too hard since you already know how much of the yearly amount you are “pro-rating” into each visit. If you are making a profit for each visit (and you should be) just have on your internal “Job Profile” what the allotted amount is for each visit and your techs will earn based off that amount. Simple!
Also I don’t know that I would give away in your initial proposal the protector. Instead, I would leave both this and the free carpet spotting as a closing tool. I would also ONLY present the higher “pay 50% more” proposal with the statement, “Just look at the much better appearance level with a slightly smaller average monthly investment” selling statement. It is so much easier to come down than go up!
PPS: Check out our upcoming SFS Training options to keep transforming your business.