On an average day at an upscale food market, there was a table covered with more than 24 varieties of jam. Encouraged by free taste tests and "$1 off" coupons, shoppers swarmed the table. The profits were good, not great. No surprises there.
On another average day, another table was set up - this time, with only 6 varieties of jam. Lacking the variety of the previous display, this table only attracted a moderate amount of shoppers, but the results were astounding.
The results from Psychologists Sheena Iyengar and Mark Lepper's jam study were surprising: the table with fewer jam options had fewer visitors, but sold almost ten times as much jam per person.
Even in the service industry, sometimes less really is more. You want to make larger profits with your service company, so how can you tell if you're offering too many services?
If you don't read anything else in this post, at least read this:
"To make a new service profitable, you must calculate exactly how much money this service will cost you. Job Costing is the only way to guarantee that you are charging the right amount for your services."
How much do clients pay you for shrub trimming?
Now, how much does shrub trimming cost you?
If you own a lawn care business and you can't answer both of these questions, you might want to cut back on your non-core services like shrub trimming. You would be surprised how many thousands of service companies waste their time on jobs that cost them money.
How long will it take you to clean those windows?
You've cleaned windows before, just spray and wipe. No problem, right?
But two hours later you've used the wrong product on the glass, and you're still trying to get it to come off before the client gets sees it.
There's no point in selling a hundred different services to your customers if you are not ready to handle each of them. You're more likely to lose money on the services you don't know how to do, so think about cutting those services out altogether.
If you're looking to expand your services AND make more money, expand slowly.
"You sprayed pesticide on that spot last week, and look at it. It's completely dead!"
If you're lucky, this client will never talk to you again. If you're unlucky, she'll never talk to you again AND badmouth you to all of her neighbors AND leave a terrible review online.
It's an awful feeling to mess up a job. But if you keep messing up job after job, you might need to cut back to your core services and work on doing a small number of services really well.
Remember, don't let the naysayers get you down. You will get it right if you go slowly.
You've got an armful of door hangers, and a hundred houses to hit. As you go to place that first door hanger around the doorknob - you see another door hanger already there. Looks a lot like one of yours.
Bad news: it's your competitor's door hanger. If your marketing pieces are starting to look the same as your competitors - complete with long lists of services that you both provide - you're doing something wrong.
Take a step back. Just because your competitors are offering a hundred different services DOESN'T MEAN THEY ARE MAKING MONEY. Don't copy them.
"Yeah, I didn't read your website. There were too many words on it. But how about this? Can you just do this for me? And this, and this?"
Chances are, if you offer too many services, people will assume you're up for anything. It makes it look like you don't care how you get your money, as long as you get something. That's no way to streamline your business.
What is your specialty?
When asked this question, one or two services should immediately pop into your head. If not, you might be missing out on referrals because your own clients don't know what you're good at. When you focus on your core services, you get really good at them - and people will take notice.
Here's an example: My mom used to always come home from shopping with grocery bags rustling in her arms. Usually, she would ask my brother and I for help, and start talking about whatever she had bought.
One time we heard the door opening, and the tell-tale sound of bags rustling, but this time the first thing she said was, 'Hey. When did our neighbors get such pretty flowers? I need to ask them who they hired.'
"Wall washing? Power cleaning? Decks and Chimneys? Windows and Carpets and Steam or Shampoo and - I JUST WANT SOMEONE TO CLEAN MY HOUSE."
The hardest part of selling to a client is getting them to become your client. If you throw all of your services into their faces, they might get overwhelmed. You need to let them know what you do best, and leave it at that.
What if you have a pest control tech, but you don't have enough work to keep him busy full time?
What if you offer a carpet cleaning service, but it takes you three times longer to clean carpets than any other task?
What if you're a landscaper, and someone asks you to mow because you're already there?
You could be losing money every time you work outside of your core services. This is a huge problem that nobody talks about in the service industry, because most people don't realize it's a problem at all. When giant cleaning corporations offer dozens of services, they can do that because they've spent thousands of hours perfecting each and every one of those services.
Pricing isn't easy, and adding more services to your repertoire is only going to make it harder. If you are seeing any of these signs in your service business, you might need to take a step back, and figure out if you could make more money by cutting out some services.
Tags: Business Operation