Convert your clients

June 1, 2003 -  By

By: George Witterschein

Converting your design/build projects into maintenance contracts is a tonic for your business. Maintenance contracts can help you build long-term relationships with your clients.

Alan Skipper is the Virginia residential design/ build manager for Chapel Valley Landscape Co., a 35-year-old, $30-million business headquartered in Woodbine, Md. The firm does commercial and residential installation and maintenance as well as irrigation design, installation and maintenance. Its client mix is 75 percent commercial and 25 percent residential.

“Converting maintenance contracts is very important to us,” he says. “We want to expand our maintenance, not only for the company’s growth and employee opportunities—but also because it’s important for the success of our projects. When we design something and install it, it breaks our heart to see a project maintained improperly.”

The maintenance business is also important to Chapel Valley as a kind of recession-proof “annuity.” Maintenance balances out revenue streams of cyclical installation projects, Skipper says. He agrees with the industry adage that customers tend to spend money in slow times to maintain an existing landscape even if they cut back on new designs and installs.

Bill Fehrenbach is president of The Pattie Group, a $10-million company whose primary business is high-end residential design/build work. The Group serves northeast Ohio from its headquarters in Novelty.

Like Skipper, Fehrenbach regards conversion to maintenance as very important. “We think maintenance work is absolutely vital. A well-designed and a well-installed landscape is only the first step. The care that the landscape receives is more than half of the success of a project. We’ve seen occasions where our client does not take us on as their maintenance company and the design suffers. It just doesn’t sparkle the way it should, and those situations hurt the long-term relationship we are trying to build with our clients.”

Conversion Rates

The Pattie Group, doing about 80/20 design/build to maintenance, currently converts about 40 percent of its design/build projects into maintenance contracts. “We recently brought our maintenance operation under centralized management, and we are not going to be satisfied until we have about three-quarters of our customers signed up for maintenance,” he says.

Chapel Valley does not pursue maintenance contracts for all their design/build projects. “We want customers who have similar values to ours … horticultural care, a high level of service and not necessarily the cheapest price. Another criterion is location—we can’t afford to drive an hour to get to a project that brings us $5,000 a year,” he comments.

“Of those we pursue, we don’t lose many because of price,” Skipper continues. “Often, what attracts customers to us is the fact that we do everything—design, build and maintain. They perceive a long-term commitment to the project. That in itself ensures a high win rate on maintenance contracts we want. We win about 80 percent or 90 percent of them.”

When and how to sell maintenance

Both agree that the time to start talking maintenance with the customer is early in the process—at the beginning!

“We talk about maintenance upfront,” says Skipper. “I encourage my designers and salespeople to discuss maintenance during the first meeting, because it makes no sense to design something for a customer who is not going to be committed to maintaining the design and installation.”

The Pattie Group also discusses maintenance from the start, Fehrenbach says. “We have some salespeople who sell nothing but maintenance, but our design/build salespeople can write maintenance estimates and contracts. If the client wants to buy a design/build, an installation or maintenance, we want to be able to sell that to them right away.”

To enhance its maintenance sales, The Pattie Group uses a technique called the “care calendar.” This is a simple spreadsheet given to the customer that shows each individual maintenance item the company recommends, the date it is to be performed, and the item’s price.

“Sometimes the customer will decline to buy an item,” Fehrenbach says, “but that item remains on the care calendar to remind them that we recommended it. We often see the customer come back and say, ‘You recommended grub control, and now I realize I should have bought it. Let’s start doing it.'”

Transition Tips

To ensure a smooth transition for the customer, Chapel Valley tries to place the design/build and maintenance teams under the same manager. “It works very well because our designers and I work closely with all the maintenance folks,” Skipper says.

Fehrenbach’s approach is similar: “We make the transition face-to-face and in person. When a project is close to completion, we bring a maintenance account manager or specialist to walk the property face-to-face with the owner, to develop a relationship and make that handoff from the initial salesperson or design/build project manager.”

Internally, both companies rely on great communication and teamwork between maintenance and design/build managers during the transition.

Fehrenbach comments, “Plus, we have contract administration people keeping track of where the client stands on each phase of the project. On all levels—administration, execution/production and maintenance, the people on the team taking care of the client are constantly talking and sharing information. It’s a nonstop effort to communicate and make sure that the client’s needs and wants and idiosyncrasies are handed off and that it’s all written down in the job folders.”

Maintenance sells design/build?

While in the typical scenario, good design/build sells maintenance contracts, the process sometimes flows in reverse: Customers looking for a landscape maintenance company will often discover that they want or need a design/build job, either to eliminate a maintenance problem or to add a desired enhancement from a company they have learned to trust.

This “reverse sales flow” frequently involves overcoming landscape problems like difficult terrain.

“We try our best to overcome those kinds of problems as early as possible in the relationship,” says Skipper. “So if we foresee a maintenance problem we will bring it up in the first meeting, and say to the customer, ‘We need to address this in the design.’ And we try to eliminate that problem in the design itself. That’s our job on the design side and the installation side. Hopefully, by the time the maintenance is there, it’s no longer a problem.”

Fehrenbach agrees. “We design the problem out of the picture. That is the better way, and as a plus, it gets us some more design/build work.”

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