Strategic Management Forum

1

• Strategic Management Forum

• Maintenance Agreements Equals Monthly Residual
  Income and Equity For Your Business

Facilitator Heather D. Blease Savi Systems
2
Instructor Heather D. Blease Savi SystemsSouth
Portland, Maine

• Digital Equipment Corporation
• Design Engineering, Mfg, Management
• Envisionet Computer Services
• Founder, CEO, Chairman, 30M,
• 2500 employees, Venture Capital
• Consultant
• Executive Mgmt, Custom Retail, Technology,
  Financing
• Savi Systems
• Savi Integrated Systems, Savi Energy

3
INTRODUCTIONS
4
OBJECTIVES

• Why a Service Maintenance Agreement?
• Definition of Service Maintenance Agreement
• Discussion of Service Maintenance Terms
• Positioning and Selling Service Maintenance
  Agreements
• Practice within a group

5
A G E N D A

• Session Overview
• Define our Learning Objectives
• What is a Service / Maintenance Agreement?
• How to position, price and sell to the client
• The Agreement
• Trying it together - working group lesson
• Questions and Answers

6
SERVICE MAINTENANCE AGREEMENTS WHY?

• 1. Recurring Revenue Stream Customer Long-Term
  Satisfaction
• Predictable
• Reliability Guaranteed
• Cash flow machine
• Security, Cell phone company examples
• Adds Value to Company (exit, financing)
• Add Value to relationship with client NOT A BIG
  BOX EXPERIENCE a relationship!

7
A G E N D A

• Session Overview
• Define our Learning Objectives
• What is a Service / Maintenance Agreement?
• How to position, price and sell to the client
• The Agreement
• Trying it together - working group lesson
• Questions and Answers

8
DEFINITION OF AN EXTENDED WARRANTY

• feasible
• iPod - Get the most from your iPod for two years
  from its original purchase date with the
  award-winning AppleCare Protection Plan. You get
  telephone technical support from our experts for
  questions about using your iPod, and you get
  global repair coverage ? both parts and labor ?
  on your iPod, its battery, and included
  accessories. iPod coverage 59
• Mac OS System - The AppleCare Premium Service
  and Support Plan covers both Xserve hardware and
  Mac OS X Server software. Get up to three years
  of expert telephone and email support and onsite
  hardware service to keep your Xserve system up
  and running. If you experience a problem, Apple
  technical support experts are available 24 hours
  a day to help you determine if it's a hardware
  failure or a Mac OS X Server configuration issue.
  In either case Apple's support staff will work to
  get your system up and running as quickly as
  possible. And because Apple's hardware and
  software are uniquely integrated there's only one
  AppleCare number to call.The AppleCare Premium
  Service and Support Plan delivers expert
  telephone and email support with 30-minute
  response time--24 hours a day, seven days a week.
  The hardware repair coverage ensures four-hour
  onsite response during business hours and
  next-day onsite response after business hours
  (terms apply). Onsite response time and
  availability of onsite service depend on your
  location. With the AppleCare Premium Service and
  Support Plan, you'll have the assurance that
  Apple-authorized technicians will perform repairs
  using genuine Apple parts. MacIntosh OS Operating
  Sytstem AppleCare coverage cost 950

9
DEFINITION OF A SERVICE MAINTENANCE AGREEMENT

• . . . It is not about the equipment component
  repair.
• It is about the complete experience when a
  problem does occur.
• THE WARRANTY COVERS THE EQUIPMENT
• THE MAINTENACE AGREEMENT COVERS THE SYSTEM

10
WHY TIME AND MATERIALS DOES NOT WORK

• . . . Not worth the risk

11
WHAT DO CUSTOMERS REALLY WANT AND EXPECT?

• Quick Responsive Service Time
• No Budgetary surprises
• Ease of purchase / under the radar
• Support without question or hesitation
• Proactive service with quarterly visits
• Value meets their needs (7/24)
• Reduce Client Real Risk perceived Risk
• Instant Loaner

12
A G E N D A

• Session Overview
• Define our Learning Objectives
• What is a Service / Maintenance Agreement?
• How to position, price and sell to the client
• The Agreement
• Trying it together - working group lesson
• Questions and Answers

13
DESIGNING THE CORRECT PACKAGE

• The presentation package determines mediocre or
  great results.
• Whats in a name?
• One plan or various packages?
• Existing Clients or New Client, how to sell to
  both.

14
THE OFFER

• 1. The Presentation
• Make a professional brochure that clearly
  outlines the different levels of coverage
• Looks professional
• Adds credibility to the plans being offered
• It empowers the client to make the right choice
  for their budget and individual needs

15
THE OFFER
2. Choices VIP Preferred Standard
16
THE OFFER
3. One plan or various packages?
17
CONSIDERATIONS

• Preventive Maintenance and Support
• (proactive and reactive service)
• New Clients
• Existing Clients
• COMMISSION FOR PMA SALES
• HAPPY CUSTOMERS REFERRALS
• A good reason to contact clients
• Past, new big box failures, competitors
• Instant revenue generation
• Up-sell

18
PRICING CONSIDERATIONSPreventive Maintenance
Agreement

• New Clients ( OF SALE)
• Existing Clients (Survey of client system, fixed
  annually or monthly, etc.)

19
How to price for new clients Full Service
Agreement (monthly) _at_ per mo. Annually,
Bi-annually Your thoughts on this example
20
PRICING ON LEGACY SYSTEMS

• Algorithm for service on old jobs
• Age of install (A)
• plus number of foreign sports cars in garage (S)
• divided by Miles from Ocean (O)
• equals Rate (R)
• A S /O R

21
PRICING LEGACY PREVENTIVE MAINTENANCE AGREEMENTS

• Client Survey

22
PRICING LEGACY PREVENTIVE MAINTENANCE AGREEMENTS

• Client Survey
• Estimate hours multiplied by labor rate
• Establish a minimum charge
• Collect Automatically -reoccurring revenue
• Upsell, upsell, upsell

23
A G E N D A

• Session Overview
• Define our Learning Objectives
• What is a Service / Maintenance Agreement?
• How to position, price and sell to the client
• The Agreement
• Trying it together - working group lesson
• Questions and Answers

24
DESIGNING THE PACKAGE FOR NEW CLIENTS

• New Clients -
• Seamless integration. Installation and service
  is one and the same.
• Leverage key features and benefits to win sales.
• Sales force integration via compensation
  incentives
• Not an option - essential element in the sale.
• Use a matrix table to show the benefits and need.
• Make it easy to sign. Same contract document as
  the sale.

25
PRESENT AND SELL THE FULL SERVICE PLAN
26
DESIGNING THE PACKAGE FOR EXISTING CLIENTS

• Existing Clients
• Research what they pay for T and M service calls.
• Raise your rates for T and M service.
• SA must be shown that they offer a higher level
  of service.
• Create awareness.
• Develop a package.
• Personalized letter.
• Respond by a specific date - call to action,
  sense of urgency, expiration of offer.
• Must provide and clearly show value.
• Use matrix table to show financial and emotional
  benefits.
• Telephone call follow up to the letter
  invitation. Big accounts a face to face meeting.
• Test market with key accounts.

27
Send a letter to your past clients offering the
maintenance service packages - This works
exceptionally well with past clients that have
had TM service calls. Follow up with a personal
phone call to discuss the letter and plan
options. Make more than one call if you dont
make contact the first try.
28
CREATE A BASIC AGREEMENT Keep it simple and
short. Clearly outline the services, performance
guarantees, and limitations to the maintenance
agreement.
29
CREATE A BASIC AGREEMENT Make sure you can
deliver what you promise.
30
A G E N D A

• Session Overview
• Define our Learning Objectives
• What is a Service / Maintenance Agreement?
• How to position, price and sell to the client
• The Agreement
• Trying it together - working group lesson
• Questions and Answers

31
WORKING GROUP CREATE AN AGREEMENT THAT SELLS

• 15-minute Collaboration
• Each Share 3 service/maintenance topics that are
  working well in your company
• Each Share 3 issues that present challenges
  within or preventing the rollout of
  Service/Maintenance Agreements
• Select groups top three in Working Well and
  Challenged Categories.
• Discuss Resolutions to Challenges
• One spokesperson to share with Class

32
(No Transcript)
33
QUESTIONS? Thank you for
attending! Please complete the course evaluation!
Heather D. Blease heatherb_at_savi-systems.com 207-8
41-3446 (cell) 207-774-2010 (office)