There has been a lot of discussion at the United States Forum about the benefits of being a self-service handler where you provide only a warranty service for a manufacturer of the products you sell compared to being an All Servicing Appliance dealer and service by which you serve all Requests for warranty service from a manufacturer no matter who sold it.
It has been very good response most of them in favor of being an All Service Dealers and I totally agree with that side of the equation. However I thought I would break this down and come to the real root of the problem the mindset of the Appliance Dealer and Business Owner.
The real answer stems from your own business strategy and whether you want to grow your own service department and possibly your own sales volume as a result of that service. If you as a business owner really want to grow your service department it may be detrimental to the growth of your business to lower free referrals. Let me elaborate on this. The key here is how to handle the warranty call and what you do with the information after the call.
While the idea of just serving what you sell and refusing to serve what a competitor is selling is in my opinion justified in one aspect and that is that it seems to be very useful for your contest possibly even giving them kudos to get it fixed fast and efficient under warranty and doing very little for you and this is probably the last thing you want to do RIGHT? Yes I know what youre probably thinking Are you nuts you have to be crazy I do not give my contest any help at all. Why should I do my warranty work after all I did not make a Dime on sale and now Im doing it for him. ok so just sit back and think about it for a minute. If its your intention to build your service department and make it profitable then maybe its not that bad. However there are at least five real problem areas that need to be addressed and carefully looked at before you offer that service to your competition and they are as follows.
Your service department must be established and operated as a separate for profit department.
If your service department will be successful this must MUST be done no questions arguments just do it. Do not let your service department be a burden for your sales department. If your service department calls the sales department out of warranty or even a warranty call that you know can not be billed you invoice the sales department. It may not be your full course but it must be slightly higher than your cost of doing business.
Feel your cost to do business.
This is probably the most critical component in the success of your service department. Once you know this number then and first then you should negotiate with any manufacturer or even your sales department about what you will accept as an hour or fixed amount of service.
Guarantee work is usually not a big profit maker.
When it comes straight to it most manufacturers will try to squeeze every dime out of you as they can out of you when it comes to negotiating your warranty rate. If you know what your Cost of doing business is it will be a brainer. You simply decide what kind of profit you want to make if any about warranty service and negotiate there. Never take anything less than your CODB. I know you say I can handle it by volume. No you do not do not do children yourself. Just say Thanks for the opportunity but I can not manage that number and let them go.
Warranty certificates are NOT free.
I know that most of these manufacturers service engineers will tell you We will send all these phone calls and it will not cost you a dime. Because of this they will tell you that you can save on advertising because you do not need to advertise so much and because you do not need to advertise so much you can do their work at a lower price. Im here to tell you thats not entirely true.
Keep marketing to the customer interview customer.
After making a phone call the worst thing you can do is do a good job for them and never contact them after that. You must TRAIN you service technician to talk with the customer in his home. Let them know without doubt that you are not the company from which they purchased the device but that YOUR COMPANY is the one who provides warranty service for that product and makes sure it works as intended and not just that device but that You provide service repair for all home appliances and when one of these products breaks down you will also be happy to repair these products as well.