Clients need service and support contracts, but many don't want to pay the price. Likely the best investment any small business can make to help ensure productivity, efficiency, and uninterrupted business operations, some organizations resist critical maintenance and monitoring tasks.
This always amazes me. Clients sometimes find it difficult to justify paying $X to prevent possible downtime, yet when critical PCs, servers, or network equipment fails, they don't hesitate to get you out of bed on a weekend to pay $5X to repair a failure.
As true partners, it's your responsibility to help business owners understand the need for and the business value of service and support contracts. Here are three tips for selling maintenance plans.
1. Document service plan benefits
Even if a business hasn't expressed interest in becoming a service or support contract client, draw up a maintenance plan agreement and personally deliver it to the business owner the next time you complete a project on-site. Take a minute to review bullet points that tout the plan's benefits.
My consulting firm's contracts typically provide all the following benefits:
- Priority service response, meaning the client receives emergency assistance quickly when crises arise.
- No industry-standard call-out fees (often listed at $35 or more to cover technician travel time and/or fuel costs).
- Four or more pre-paid service hours each month.
- Daily monitoring of servers and critical systems and equipment to provide proactive protection from failures, errors, and other business disruptions.
- Discounted rates for other work.
- Discounted rates for employees' personal systems.
Having a document handy that lists the benefits of proactive monitoring and prevention, as well as other benefits to the business, helps reinforce the value owners receive when entering such a contract. Keep these documents short but descriptive; my firms' contracts run just two pages, including space for contact information and signatures.
2. Audit service history
If you still encounter resistance closing a maintenance contract after providing a client with a sample service and support contract, take some time to review their service history. If the client has been calling your IT consultancy for emergency repair or break/fix work over the course of a year or more, annualize the total costs and then divide by 12; the total is usually more than the average monthly maintenance plan subscription. Point that out (tactfully) to the client.
When regular clients resisted signing a maintenance agreement, I reviewed their invoice history over the past year. Most of the time, those clients would have saved money by subscribing to a maintenance plan that would have helped prevent failures (such as when server data partitions consume all available free space, email databases exceed maximum limits, etc.). On those occasions when proactive maintenance wouldn't have lowered the bill (e.g., hardware loss due to lightning strikes, end-of-life-cycle performance issues, or other trouble), I note how much the client would have saved by avoiding call-out fees and enjoying better service rates. Such calculations often remove any remaining objections.
3. Review unscheduled downtime costs
If preparing a sample contract and reviewing service history (and associated expenses) doesn't convince a client of the benefits of a service and maintenance plan, be sure to review the costs of lost data and unscheduled downtime.
In 2008, CompTIA reported that spyware infections typically require 2.5 days to resolve. Worse, the costs from resulting downtime are excessive. CompTIA's statistics indicated small and medium size business workers lose 18 work hours before reporting spyware, and total costs are listed at $8,000 — and this total doesn't even factor lost revenue! (Spyware infections can be prevented via preventive maintenance.)
A 2001 Ontrack report, Cost of Downtime Survey Results, found that U.S. businesses lose on average $12 billion a year due to data loss. Maintenance plans should place a premium on not only ensuring solid backup routines are in place, but also on monitoring daily backups to ensure the backups complete properly and that all critical business data is safely stored off-site. Worse, according to the National Archives & Records Administration, 93 percent of companies that lose data center access for more than 10 days file for bankruptcy within one year.
While I don't advocate using scare tactics to convince a client of the importance of technology maintenance and service plans, these are real statistics. All hard drives fail — it's just a question of when. RAM chips can prove faulty. Motherboards and disk controllers develop inconsistencies. Power supplies flake out.
Don't minimize the importance of signed maintenance contracts. In addition to helping ensure your clients' business operations run more smoothly and their data are properly secured and protected, by signing clients to a formal maintenance plan, you help solidify your standing as that client's IT provider. At the same time, you can minimize unscheduled break/fix work and spend more time performing preventive maintenance, thereby helping smooth your own business' operations.
While you can't prevent failures and errors, you can serve as a valuable business partner to your client and help identify and mitigate known risks. Helping clients understand the importance of maintenance plans is an important first step in becoming such a partner.Get weekly consulting tips in your inbox TechRepublic's IT Consultant newsletter, delivered each Monday, offers tips on how to attract customers, build your business, and increase your technical skills in order to get the job done. Automatically sign up today!
Erik Eckel owns and operates two technology companies. As a managing partner with Louisville Geek, he works daily as an IT consultant to assist small businesses in overcoming technology challenges and maximizing IT investments. He is also president of Eckel Media Corp., a communications company specializing in public relations and technical authoring projects.