Mikel recently invited a business owner to lunch. In his email invite he used the phrase “negative service company” and the owner chuckled. He said he had never heard that phrase before. He runs a multi location restoration business.
This sort of shocked me. Our flagship negative service company does autoglass repair & replacement. For me, the restoration of something broken is a fairly pervasive segment of the marketplace. Our tool & die shop also provides equipment repair and service for advanced manufacturers in our community. We bring back into working order that which has degraded.
The jokes in this segment of services are just great. Think about roofing companies excited by hailstorms. Or, auto repair shops when break downs occur. They are hired to bring the customer back to status quo. Often, with some sense of urgency. By their nature, the break down was not planned.
The negative service business contrasts with the positive service company. Positive service companies improve upon the status quo. Our flagship positive service is skydiving. You pay to have a bucketlist experience added to your life. Our tool & die shop fabricates specialized tooling and simple machines to help advanced manufacturers improve throughput.
If you are in a business that returns working order to the lives of your customers you are in a negative service company. Like the HVAC going out, your customers call with a clear problem. Fix it. Next up, you can consider a couple of pathways. You can restore the status quo. Or, you can present improvements. When our home’s heating & cooling system started glitching, I opted to explore improvements. I was excited by geothermal and had a large waterway on our property that could have made it super efficient. After talking with a few providers I reached the conclusion that my idea was too rare for my local vendors. They also did not give the impression that they had any expertise executing my idea. And, making matters worse, I was no expert in these matters. And they clearly were. As a result, I was “upsold” a hybrid heat pump system to gain a bit of efficiency without undertaking a massive and rare geothermal to the waterbody installation. This is one example of converting a negative service customer to a positive service (I spent more.) There are others.
Many negative service companies work closely with insurance companies to restore property to the status quo. Insurance itself is a negative service company. And they like to partner with maintenance and best practice firms. Perhaps you could add maintenance contract to your offering? Or, maybe you need to sell extended warranties? Do you already offer these? How do they effect sales of other areas?
Many people are risk averse. Business owners are usually more able to absorb risk for a profit. Look for ways to absorb risk in your negative service business and earn a profit through the law of large numbers. The law of large numbers states that as a sample size grows, its mean gets close to the average of the whole population. Your negative service company may be in a stronger position to know the average better than others. You can underwrite a price on an extended warranty better than most. As you grow you may also benefit from more and more specialized equipment and staff training; as fewer competitors will be able to duplicate what you can deliver.
You may also find preventative maintenance sub niches within the larger negative service space. Factory equipment repair is an example of this. The more niche the repair the further people are economically able to travel to deliver. One friend founded a company for workforce wearables to monitor safety of staff. This is a service that can travel!
The purpose of a negative service company is to restore order to the degraded. A sophisticated sales process can sometimes adjust expectations of the customer. However, in most negative services the choice of “just enough” or “upgrade” is most powerfully held by the customer before your salesforce engages. Think back to my HVAC example. Did I get upsold? Or, did I go shopping for an upgrade after I had an excuse to shop?
I believe segmentation is the key here. If you are geographically constrained, it’s probably best to implement a segmentation question early in your sales intake process. Are you after the cheapest option or want something a bit better than you had before? In our autoglass business many consumers simply want cheap. They will sacrifice safety and longevity simply to get back on the road. These are not our ideal customers. We prefer those who want speedy results at high quality. Our team goes above and beyond to earn high ratings and delight and surprise our customers. Small, thoughtful touches can deliver here. A cute notecard left in the vehicle may be all that it takes for them to enjoy the cleaner windshield that replaced the cracked windshield.
Reviews are important in a negative service business –just as they are in all businesses. High marks from past customers might not lead to repeat customers for you, but they accelerate the velocity of like-kind customers contacting you.
Learn how we manage sales workflows in our various team sizes; from 2 to 100 employees, in our Indiana headquartered make-to-order service companies.