June 9, 2014 3:10 pm

Service Contracts: A Small Price For Certainty

Topics: Service Agreements, Service Contracts, Business best practices

Picture the last time you made a technology purchase from a big box electronics store. Perhaps you purchased a refrigerator, television or a new computer.

As you walk up to the register ready to pay, the cashier asks you if you want to include service with that. Subtly, yet with conviction letting you know that if anything at all happens to the product for the next year or more that the product will be covered. No questions ask.

If you are like most consumers, you say no thank you and you go on your way. Most people tend to believe that their product will be okay, and often times they wind up in fact, being okay.

However, at some point the clock runs out on your good luck. It is day 2 out of warranty and the Fridge springs a leak or the motherboard sizzles and all you can do is shake your head and say, “Darn, I should have bought the warranty.”

In the Audio Visual industry we see the same behavior from many of our customers. We design and install systems that can be 10k, 100k or sometimes more than a million dollars and when the time comes for the customer to decide if they want a service contract on the project, they hesitate.

They see the value and are willing to pay for the design, hardware and installation, however they aren’t willing to spend 7-10 (insert rate) % of the price of the project to ensure that their investment runs efficiently for the years to come.

Understandably, companies all have budgets and when they are doing new technology implementations, they want to stretch their dollar as far as they can go to get the most equipment packed into the system.

As an integrator, we love that our clients want to spend their money on the hottest gear, however as a business partner we genuinely aspire to see our clients couple adequate service agreements to their systems so they can be sure that they will have the service and support they need when they need it.

You Will Need It…

The average lifecycle of an audiovisual system is 5-7 years in the current market place. New, lower cost hardware has shortened the cycle slightly, however with usually more than a dozen major components in a system, sometimes running 24/7, it is almost a certainty that service at some point will be required.

Now, we do offer traditional break-fix services, however there are multiple reasons depending on break-fix services can be problematic for your business. Some of the reasons are:

1. Availability: Service technicians are often scheduled on a first come first serve basis with preference given to service contract customers. If a call comes in and the techs are already out, the wait may be longer than you would hope and while we most certainly want to help, we can’t have a group of extra technicians “Just in Case.” Furthermore, most service agreements include service level guarantees that ensure a person is onsite at a certain time.

2. Price: It may seem less expensive to just roll a truck when needed, however emergency service can be very expensive by the time you pay the minimum fee and the per hour fee, you may be upside down after one or two service calls. Over 5+ years you may have the need for more than a few as components require maintenance

3. Preventative Maintenance: Most service agreements come with “Proactive” maintenance where technicians take care of equipment ahead of time with the hopes to minimize issues down the line. This approach reduces failures and spots problems ahead of time. Most of which are covered in the service agreement.

If there is one thing that we know for sure, system failures often take place at the most unpredictable times.

Service agreements alone won’t stop those incidents from happening, but with priority service, guaranteed pricing and preventative maintenance, those failures will happen less often and will be taken care of faster when they do occur.

Our business seeks to help you keep your presentation systems up and running when you need them. Get in touch with us to find out how we can help with your service needs!

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