atcomsystems.ca/forum Forums General General Telephone & Systems Information Maintenance Contracts

We just had a 2 day seminar on "Selling Maitenance Contracts" in Idaho, ending Friday October 11th! Wow! They can triple your profits in 5 years. There is a manual called "How to Turn your Interconnect Into A Cash Cow." that teaches you how to sell, price, and has a contract in it. Email me for more details at [email protected] If you don't do contracts, or don't know how, maybe this info can help you! Brian

For more information check out www.interconnectinsider.com

A great web site for free info on management in our industry. Brian

I am having a hard time getting customers interested. I am a tech , not a salesman. Would like any tips on how to actually sell one of these. Sure, when their system is a pile of smoking circuits they want to buy one but when they havn't had anything go wrong in years how can you sell one. Also, once one is sold, how do you convince them to actually up date their system. A maint. contract on an old Toshiba Strata VIe? that sounds like a lose/lose.
Any thoughts greatly appreciated

I can see selling a maintenance contract on your own equipment but unless you have a s**tload of service contracts how do you price out a service contract for an old switch? The day after you sign on the dotted line the whole thing could take a dump and obviously you can't be competitive if you CYA so potentially you stand to take a big hit on the system.

------------------
One stop Voice and Data Solutions VoIP

Yeah, CYA can cost a lot ---- or, if not, cost you your business. The guy that I've been picking up after had to mortgage his house to buy a CPU for a PBX, couldn't pay his crew, and finally had to file Chapter ?? and it still cost him his business. Of course being caught in a "delicate" position by the wife (now ex) didn't help either.
Another guy has been using service contracts on new sales for the last 20-some years with great luck. A company I used to work for in So. Cal. sold "Extended" warranties vs. service contracts and made a killing. The extended warranty could be rolled into the financing package and gave great cash flow. It also allowed for some "creative bookkeeping" to slow down the tax bite as deferred income until it was used or rolled over as profit.
Either way make sure your state laws allow for this and not under usury laws. Some states restrict telecommunications and computer leasing/contracts similar to what they restrict banks.

Good luck, trust your financial advisor, and talk to your lawyer before you start down this road.

They bet it will break, you bet it won't, and they hope you win. Does it get any better? They should sell these in Vegas.

Most of the failures aren't covered, lightening, electrical, user abuse, I only offer these when I'm asked. If they still want want it after I explain the odds, I don't feel guilty.
mark

A few months back I started offering 'service only' contracts for new systems and 'parts and labor' contracts for systems that are just out of warranty. I only offer 2 types of phone systems so I don't have to keep too much inventory. If the customer is leasing a system it makes it alot easier to sell the contracts. In the case of leasing, I would sell a 'service only' contract for the first year, then a 'parts/labor' contract for the remainding years of the lease. I figure that if I can get the majority of my existing and future customers to spend $30-$70 a month I'll have great residual income in a couple of years.

------------------
| Telephone Systems | Voice & Data Cabling

I guess Capital might have something. Selling them up front could be a lot easier than trying to convert a customer to one after 5 - 10 years of flawless operation. BUt for those who have converted a 5 -10 year old customer that has had flawless operation to a maint. contract, any suggestions on how to do it? What would be the best angle? And for a 10 year old system is it cost effective to get them on a maint. contract?

A maintenace contract with all hardware still under manufacturer warranty? Sweet!

Does anyone here offer MAC work as a part of their maintenance agreement? Usually MAC work is billed in addition to the maint. agreemant. It may be a good incentive to offer so many hours of free MAC work per month.

Also, ALWAYS do a complete inspection of the PBX/KSU, MDF, Switchroom or closet, and as much of the cabling as possible. Look for poor maintenance, bad environmental conditions (dusty, dirty switchroom/closet), is the MDF a "rats nest"?, Is the switchroom/closet secure? Human tampering has caused many a service call. These precautions can help you to determine your risk and bill accordingly. And if you do accept a contract that is high risk due to poor maintenance/environment be sure to include provisions in the contract for correcting these conditions.

A maintenace contract with all hardware still under manufacturer warranty? Sweet!

Does anyone here offer MAC work as a part of their maintenance agreement? Usually MAC work is billed in addition to the maint. agreemant. It may be a good incentive to offer so many hours of free MAC work per month.

Also, ALWAYS do a complete inspection of the PBX/KSU, MDF, Switchroom or closet, and as much of the cabling as possible. Look for poor maintenance, bad environmental conditions (dusty, dirty switchroom/closet), is the MDF a "rats nest"?, Is the switchroom/closet secure? Human tampering has caused many a service call. These precautions can help you to determine your risk and bill accordingly. And if you do accept a contract that is high risk due to poor maintenance/environment be sure to include provisions in the contract for correcting these conditions.