Retail Observer

RETAILOBSERVER.COM AUGUST 2014 64 R ecently, word reached us that a manufacturer had initiated a program to broker out of warranty calls to service companies within their network for a fee. This announcement has been less than popular within the appliance service industry, as traditionally, the out of warranty referrals had been made available to authorized service providers within a given service network. In a market with ever-tightening margins, it's not surprising that this news was not exactly welcome. However, various third-party administrators have been doling out calls at a cost for some time, and it was really only a matter of time that manufacturers did the same. In their eyes, the call was received through their service organization; therefore, they "own" the call and the right to sell that call to a service provider to recoup some of their expenses incurred in running a service organization. Whether we in the service industry want to admit it or not, service support at the manufacturer's levels are being squeezed, so it's likely that we expect more of this in the future. We may not like it (and we don't), but we need to understand it and prepare to deal with it professionally and effectively. The question becomes what you, as the service professional, can do about it. This is not a case where the calls are being forced on the service network- participation is voluntary and you have the right to not take part. It becomes crucial for you to take a look at your business model and decide if this is something you can or want to do. Is it possible to add the call fee to your base rate and still be competitive in your market? It might be tough to slip in, along with fuel surcharges and the like, but it may be necessary to keep your cash call business as profitable as it has been. Another thing to consider is whether or not paperwork needs to be filed with the manufacturer on an out of warranty call- this adds to your office expense and needs to be studied. These are just a couple items that you, as the business owner, need to be aware of. There is another option- work to capture the loyalty of this consumer yourself. If the manufacturer never receives the call for out of warranty service, they can't sell the call. If the customer has called you directly, you are now the "owner" of that call. In order to put yourself in that position, you need to be proactive in how you have managed the customer relationship in the past… if you were ever out to the home on a warranty call, you have had a direct path to building rapport with that consumer. Did you repair the product quickly and efficiently? Did you maintain a professional and courteous image? Did you leave something for the customer, like a refrigerator magnet or a similar item that had your name and phone number on it for future reference by the customer? And, maybe most important, did you leave that consumer with the friendly advice to make sure that, if any future assistance is necessary, that they call you directly for the quickest and most efficient service support? It does take some effort, but that's why you do what you do better than anyone else- supply quality local service support at a reasonable price. By studying your cost of doing business model, you can make informed decisions on whether the call brokering model makes sense for you or not. In fact, it is a very good idea to take a regular look at your business model so that you can adjust it to better reflect the realities that you are dealing with daily. PSA can assist you by providing software to assist you in doing this analysis if necessary. Take a look at our "Member Tools" section of www.psaworld.com if you feel that this program would be helpful to you. PREPARE YOURSELF: CALL BROKERING IS HERE TO STAY S E R V I C E D E P A R T M E N T RO Randy Carney- Executive Director, PSA

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