A service business broke even for three years because customer churn outpaced new sales, even though they turned away hundreds of thousands in annual work. Mike Andes proposes converting one-time jobs into recurring maintenance by charging a $1,000 deposit that either credits toward service plans or funds marketing if customers decline.
Questions this video answers
$6,000 per week in repairs
About three years
$1,000
Hundreds of thousands of dollars per year
Payroll is tight. Every time if we're not doing 6,000 a week in repairs, it gets really tight.
Their churn customers leaving got as high as new customers coming in. Then they started dumping money into Facebook ads, Google Ads, etc. And it really still hasn't re energized their growth.
Pretty much break even for about, about three years.
Right now we're turning away hundreds of thousands of dollars worth of work every year. That could also be converted into recurring. So this is what my thought is. If someone said, hey, I just moved in, I need someone to come figure this out, it's not working. Okay, great. We usually say no, we do not have the time. But if we said you pay $1,000 deposit and that allows us to come out and that thousand dollar deposit goes towards your maintenance in the future.
That way if they just want their filter changed, if they just want the one time job, I keep the $1,000 and use that $1,000 to go do marketing and advertising and get more recurring customers.
You need two people a week to say yes to that offer, to pay for a full time repair tech that unlocks 300 grand for the business and by the way, greases the gears to get more maintenance. Yes, that right now they're saying no to maintenance, but they don't even know what maintenance is because they just bought a house to the pool for their first time. Correct.
