Salado

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(No Transcript)
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Servicer Profile

• Consolidated Electronics Intl
• Raleigh, North Carolina

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CEI At A Glance

• A Quick Look at CEI

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CEI At A Glance

• Opened for business in 1980
• Employs twenty four people
• Three managers (ops, cust-serv, tech-serv)
• Nine technicians
• Three front end staff
• Six drivers
• Two administrative
• One shipping / receiving clerk
• C-CSC approved service center

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CEI At A Glance

• Three service trucks
• Four service vans
• Two locations
• Raleigh, NC Columbia, SC (satellite)
• Satellite in Chattanooga, TN (Dec 05)
• Satellite in Lexington, KY (1st quarter 06)

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CEI At A Glance
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CEI At A Glance
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Agenda

• Agenda

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Agenda

• Image is important
• Perceived value
• Maximizing income
• Reducing costs
• Speed of money
• Service

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Agenda

• Employees
• Diversification
• Building relationships
• Warranty vs. COD

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Image Is Important

• Image Is Important

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Image Is Important

• First impressions are hard to change
• The difference between a 5.99 burger and a
  12.99 burger is image
• Professional phone presence
• Professional dress
• Professional forms signage
• Professional attitude
• Professional service
• If we want to be treated and paid as
  professionals then we must be professionals

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Image Is Important

• Customers equate tidy with professional
• Neat, clean and professional facility
• Neat, clean and professional vehicles
• Proper functional equipment

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Perceived Value

• Perception is Reality
• Especially in sales

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Perceived Value

• Service is worth exactly what we feel it is
• Customers are easily able to detect our comfort
  level with what we are charging. If we do not
  feel we are worth much then neither will the
  customer
• Go the extra mile
• Follow up
• Association membership
• Industry certification
• Training

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NESDA
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ISCET
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Consortium ofCertified Service Centers
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Maximizing Income

• God did not say unto all service centers, Thou
  shalt be broketh for eternity.
• And we refuse to work as though he did

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Maximizing Income

• Know your cost of doing business (CODB)
• If you cant measure it you cant manage it!
• Negotiated rates with manufacturers based on CODB
• Negotiated rates with TPAs based on CODB
• Refuse to work on product that doesnt support
  our CODB
• Analyzed every contract as a whole for
  profitability
• Charge a high enough diagnostic fee to cover the
  cost of the diagnostics PLUS profit

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Maximizing Income

• Ask and thou shall receive

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Maximizing Income

• Bill for everything
• Every eligible mile even if its only 5.00
• Every part, even 0.02 resistors
• Obtain authorization for additional labor on any
  repair exceeding the average
• Obtain authorization for a second billing within
  the shop warranty period if the repair is
  unrelated
• Bill for return shipping to customer
• Bill TPAs for shipping and handling, dud return
  costs, shop materials, etc At a profit
• Bill COD customers for shop materials

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Maximizing Income

• Would you like fries with that?
• Up-selling is a great income producer

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Maximizing Income

• Projection TV maintenance
• DLP / LCD filter service
• Cables accessories
• Surge protectors
• Home theater set-up
• Customer education

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Reducing Costs

• There are thieves among us

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Reducing Costs

• Reduce time theft
• Recently found some employees not clocking out
  for lunch. Cost to the company was 8,900 per
  year
• Charge a monetary penalty for consistent
  tardiness of salaried employees
• Installed GPS tracking on all vehicles
• Blocked certain domain names from our network
  such as Yahoo Mail, AOL Mail, etc

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Reducing Costs

• Use Nextel instead of cell phones
• Flat rate long distance
• VOIP technology
• Eliminated yellow book advertising
• Eliminated most postage
• Pay bills online
• E-mail customers
• Fax whenever possible

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Reducing Costs

• Make arrangements with distributors
• No cost restock
• Free shipping
• Expedited shipping
• Free return labels
• Extended Terms

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Speed of Money

• Speed of Money
• The quickest way to go broke is
• to be owed too much money

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Speed of Money

• Attempt to file all invoices same day
• File digital invoices whenever possible
• Fax invoice if possible when email and online are
  not
• Accept credit cards from TPAs
• Follow up on stalled invoices immediately
• Utilize all resources (field rep, warranty rep,
  etc)
• Call COD customers immediately
• Follow up continually
• Make payment options easy such as credit card
• Utilize a collections procedure for COD
• Send out professional collection style notices

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Service

• Service
• The business of fixing customers
• Its our responsibility to take care of customers
• before the competition does

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Service

• Maximize repair efficiency at every stage
• 1-2-3 procedure for approaching repairs
• Repairs done in sessions
• Evaluate certainty level of all part orders
• Utilize tech support
• Involve field rep personnel

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Service

• Pick up and delivery service
• Run routes in circles to cover broader area
• Run drivers 4 days on and 3 off to extend work
  day
• Guarantee 50 hours to promote expedience
• Utilize GPS tracking for truck supervision and
  assistance with directions
• Proper equipment
• Blankets
• Straps
• Lift gate
• Pads

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Service
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Service

• In-Home service
• Strong inventory
• Make liberal arrangements with distributors for
  for restocking and terms
• Keep track of turn rates
• Run circular routes
• Offer guaranteed hours
• Only provide in home service if 99 sure unit can
  be repaired on first trip otherwise pull it

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Service
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Service

• Counter Service
• Same day / next day evaluation
• Limited counter hours
• Ship in service
• Profitable in volume
• Make contract deals for bulk product
• Charge a profitable price for shipping and
  handling

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Employees

• Employees
• You can succeed best and quickest by
• helping others to succeed

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Employees

• Hire On Attitude
• Its easier to train than to accommodate a bad
  attitude
• Attitude is a little thing that makes a big
  difference
• Hire good people
• Lousy staff costs far more in lost opportunity
  than the extra you pay for good staff
• Let employees know you care
• Include employees in the decision making
• Provide feedback

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Employees

• Provide benefits
• Not necessarily company paid or even subsidized,
  but would still be pre-tax
• Health Insurance
• Life Insurance
• Disability Insurance
• 401K or Assistance with IRA
• Profit Sharing
• Medical Savings
• Vacation time

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Diversification

• Diversification
• Unless you try to do something beyond what
  youve already mastered, you will never grow

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Diversification

• Microsoft Development partners
• Commercial Equipment
• Industrial Equipment
• Depot Service
• Home theater set-up
• Specialized service level agreements with
  manufactures, TPAs and other customers

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Building Relationships

• Building Relationships
• Problems become opportunities
• when the right people join together

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Building Relationships

• Know your field reps well
• Communicate frequently
• Make sure they are aware of your willingness to
  be flexible
• Be sure they know they can count on you
• Establish a close relationship with suppliers
• Network with fellow servicers
• Get to know your association volunteers
• Establish relationships with stores

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Warranty vs. COD

• Warranty vs. COD
• Choose your poison

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Warranty vs. COD
Advantages

• COD
• Greater speed of money
• Fewer restrictions on type and path of repair
• Potentially higher rates
• Able to make faster pricing changes to
  accommodate market conditions
• Less restriction on repair path and parts sources

• Warranty
• Greater support
• Better access
• More options
• Board level repair
• Exchange possibilities
• Technical support
• Corporate involvement
• Repair cost is less of an issue
• Steady work stream
• Referrals

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Warranty vs. COD
Disadvantages

• Warranty
• Rates negotiated annually
• Stricter guidelines
• Repair times
• Parts sourcing
• Repair path
• Potentially greater administrative costs
• Slower speed of money
• Pricing changes are inhibited by contract rate
  negotiations

• COD
• Must take full responsibility for the repair
• Limited corporate backing
• Higher administrative costs with estimates and
  customer contact
• Higher advertising costs
• Volume is subject to market conditions

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Pictures

• Pictures of CEI

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Full Store Front
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Business Office Entrance
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Customer Entrance
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Front Counter
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Reception Area
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Reception Area
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Customer Service Stations
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Literature Library
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Literature Library
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Warehouse
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Warehouse
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Warehouse
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Warehouse
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Big Screen Burn In
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Service Trucks
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Service Truck
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Service Vans