Could Germany's Portable Woman's Toilet Expand Plumbing Product Offerings?

Photo: KETS

I don't make this stuff up. I'm not that imaginative. I just pass it along. According to a story from Germany's Spiegel...

A German company says it has designed the world's first pocket urinal for women and claims it will put an end to nightmare encounters with filthy public toilets, time-consuming queuing and having to relieve oneself into yoghurt cups during car journeys.

The disposable Ladybag is a plastic bag fitted with absorbent polymers that turn urine into a gel. It's the size of a chocolate bar when folded. It has a wide opening and can be used squatting, sitting or standing. Its gel can absorb half a liter -- enough to process the average amount of urine per sitting -- but the bag itself can hold a whole liter in an emergency.

Yogurt cups during car journeys? Maybe the Germans are a little too efficient.

A package of three Ladybags costs a little more than $16 in Germany ($13 without the German value-added tax). Over 20 thousand have sold in the first year. A similar product for men, called the Roadbag, sells at the rate of 200 thousand a year.

I don't know whether anyone is planning on importing these into North America, though this seems like the type of product Shubee or M.A.R.S. might carry. If so, it might lead to add-on sales during calls.

Personally, I'll never be able to drive the Autobahn again without wondering... Nah. I'm not going there.

24 Ways to Boost Your Average Ticket – Part II

4. Sell Six Packs

One of the classic approaches to boosting your average ticket is to sell packages. The plumbing contractor can approach the restaurant to offer six drain cleanings for the price of five (i.e., a six-pack). The same approach works with pest control, carpet cleaning, pool cleaning, air conditioning tune-ups, sprinkler head replacements, and so on.

Instead of billing by the quarter for pest treatment, pre-sell a year at a discount. Clean the carpets of six rooms for the price of five. Offer a discounted air conditioning tune-up for three years.

Will everyone buy a package? No. Of course not. But some will, especially if the customer believes he will take full advantage of the package and can save money. The advantage to you is the customer is locked up for a period of time and you get paid up front.


5. Create a Checklist of Common Problems

Depending on the neighborhood, type of home, builder, or common area practices, certain problems are likely to be repetitive. Often, these are problem in the making. Let me share an example.

We were at the beach house this summer when a capacitor failed on one of the condensing units. After the technician replaced the capacitor, he asked if we had a drain pan. He then proceeded to explain that whoever installed the HVAC in our beach development neglected to include drain pans.

The evaporator was located in a closet direct above the stairs. If the condensate line ever stopped up, the tech explained, it could ruin the ceiling over the stairs, affect the carpet, and stain the walls. The repair costs could easily run into the thousands and even if insurance were to cover it, we would still be out the deductible and the hassle.

We looked. There was no drain. I told him to put one in. As a consumer, it was a no-brainer.

As a contractor, it’s a no-brainer to alert your customers to common or repetitive problems. The best way to do that is to create a checklist for your dispatchers and your field service personnel.

“Mr. Homeowner, do you have problems with toilet stoppages? I thought so. When this neighborhood was built the low flow toilets weren’t all that good. We’ve got some super toilets now that simply will not clog. If you’re tired of plunging, let me know. Since I’m already here, it’ll save you some money.”

“Mr. Homeowner, I noticed some carpenter ants in a couple of your trees. These guys can do some real damage to your trees and possibly to your home if they infest it. Do you want me to treat the trees while I’m here?”

“Mr. Homeowner, your pool filter’s looking a little long in the tooth and might affect the pump if left unchecked. Do you want me to replace the filter while I’m here?”

“Mr. Homeowner, have you had any problems from lightening strikes? We’ve gone on a few calls around here where ground lightening strikes fried some computer power supplies and TVs. Have you ever thought about a whole house surge suppressor? It’ll add another layer of defense to protect you home. Since I’m already here, it’ll save you some money.”


6. Expand Your Offering

One way to boost your average ticket is to simply boost the number of products and services your customers can buy from you. Air conditioning contractors have long dabbled in the fireplace insert market and many sell stand-by generators. Why not ceiling fans or solar panels or condensing unit covers? For that matter, many contractors fail to offer the full range of conventional HVAC products, such as performance diffusers, geothermal, and zoning.

Many plumbing contractors look down their noses at sprinkler systems. Running a complementary check and offering to replace a few broken heads seems like a simple add-on to other work. Plumbing contractors can also pipe gas for backyard grills. They can offer decorative fountains inside and out.

Electrical contractors could get into the solar and wind turbine business. They can also add home automation, security, and home entertainment wiring.

Pool contractors may have the greatest expansion opportunities of all. Not only can pool contractors continually expand home pools with fountains, water slides, ponds, and so on, but there’s a near infinite amount of pool toys. Plus, pool contractors are in the perfect position to create a backyard oasis, complete with barbecue pits, cooking areas, cabanas, and more.

Pest control companies can do much more than spray and set out rodent bait boxes. They can offer to install squirrel proof bird feeders, vent cages to prevent birds from nesting in dryer vents, and so on.


7. Ask, “Would Like A…?”

Before Ray Kroc entered the picture, the McDonald brothers figured out that asking, “Would you like fries with that?” resulted in add-on sales to three out of ten customers. Okay, you don’t sell fries. What do you sell as an easy add-on?

Washing machine hoses? Water alarms? Extra filters? Pool toys? Outlet insulators? Bug spray? Service agreements?


8. Ask, “What Else Can I Do?”

At the end of every service call, every plumber, technician, electrician, and pool cleaner should ask, “What else can I do for you today?” Then, smile, freeze, say nothing, and wait for the homeowner.

While it’s not quite as good as asking, “Would you like fries with that,” it does hold open the possibility to strike up additional conversations with the homeowner. It only takes a couple of seconds.


9. Offer Upgrades

Southwest Airlines allows up to 15 Business Select fliers to pay $20 to move to the front of the line for a better shot at the airline’s unreserved seating and carry-on space. The $20 also includes a beverage and frequent flier credits.

Southwest’s Beth Harbin said, “We wanted to add value rather than slap on a fee for everyone. But the reason was to boost revenue.”

And it has. Southwest sold $100 million worth of $20 “upgrades.”

How much would your customers pay for the next available truck? Could you offer a $50 service upgrade for a faster response? You could limit the number of available upgrades to the number of trucks in your fleet.


10. Present Replacement As An Option

Field service personnel like to make repairs. It’s why they’re doing what they’re doing. Yet, repairs are not always in the homeowner’s best interest or even desirable by the homeowner. It’s the height of arrogance to plow right in and start on a repair without giving the homeowner the option to replace a product.

“I can rebuild your pool sweep or I can replace it. What would you prefer?”

“What would you recommend,” asks the homeowner.

“Well, I can rebuild it and it’ll work fine… for awhile. But it’s probably going to act up again later this season or next. When it does, I may be able to rebuild it again or you might have to get a new one. With a new one today, you probably won’t have any problems for five years or so. It’s your choice.”

The last sentence is key. It is the customer’s choice. Some customers value their time enough that five years of trouble free operation is reason enough to replace the product. Others may be planning a move in six months and want the lowest cost alternative. It’s the homeowner’s choice, but in order to make it, the technician has to present the option.


11. Present Upgrades As A Third Option

Why not go one step beyond offering replacements as an option. Offer upgrades.

“I can rebuild this faucet, but before I do, I thought I’d give you the option of replacing it or upgrading. You know those new pull out spray faucets are really nice and would look great in your kitchen.”

Instead of repair, offer the option to repair or replace. Instead of repair or replace, offer the options to repair, replace, or upgrade.

© 2009 Matt Michel

24 Ways to Boost Your Average Ticket - Part I

This is the start of a new Comanche Marketing series on boosting your average ticket, or average sale. I’ve compiled a couple of dozen tactics, but this number may change before I’m finished. I’ll add tactics when readers suggest new ways to boost the ticket I haven’t thought of (hint, hint) or when I stumble across new approaches. And also, when it comes time to write about the tactics, what seemed brilliant when building the initial list seems hopelessly stupid when I try to describe it. Well, let’s get started…


Why It Matters

Raising your average ticket even a few dollars can make a tremendous difference to your bottom line. Let’s consider the following scenario. A pure service company has an average ticket of $325. The company promotes braided steel washing machine hoses for $49 installed on all service calls. The company buys these hoses for $9. The time required to install one is so minor, it’s incidental (e.g., 5 to 10 minutes). On every 10th call, a customer opts to add the house on the ticket.

This works out to an increase in the average ticket of $4.90. The material cost increases $0.90, resulting in an increase of $4.00 in gross profit per call.

Hose Price	$49
Material Cost	$9
Gross Profit	$40
% Buying	10%

Increase in Avg Ticket	$4.90
Increase in Avg Material Costs	$0.90
Increase in Avg Gross Profit/Call	$4.00

Ho hum. Yawn. Four bucks. That’s a whopping net increase of 1.2% of sales ($329 / $325). Wooooow. I can retire.

Don’t get hasty. Let’s get into the numbers in a little more depth. For grins, let’s say the following roughly describes the company’s income statement. The company is profitable, but barely once Uncle Sam gets a cut.

Gross Revenue	$800,000	100%
Cost of Sales	$440,000	55%
Gross Profit	$360,000	45%
Overhead	$320,000	40%
Net Profit (Pre Tax)	$40,000	5%

Now, what happens when an average $4 of gross profit per call is added.

Gross Revenue	$809,846	100%
Cost of Sales	$442,225	54%
Gross Profit	$367,631	46%
Overhead	$320,000	40%
Net Profit (Pre Tax)	$47,631	6%

The company has increased pre-tax profitability 20%! Slight increases in a company’s average ticket can result in significant increases in the bottom line. While not the only one, this is certainly one path to prosperity. Let’s walk down this path and see what we find.


1. Raise Prices

Yes, the simplest way to increase your average sale is simply to increase your prices. If this seems completely obvious, it’s not. Many a contractor moans about average tickets without really pondering the notion of a bump in prices.

A recession may or may not be the right time to bump prices. If you aren’t profitable at your current price levels, you should figure out a strategy to raise prices or increase volume while holding overhead in check. Otherwise, you might as well cut prices to the bone and go out of business faster, sparing yourself the prolonged agony of a long, slow bankruptcy.

Let’s return to our pure service company. Assume the company’s billable hour rate is $125 and the company charges a $65 diagnostic or response charge. With a 40% material gross profit (i.e., 67% mark up), and average of 1 billable hour per call, the company’s average service call looks like the following.

Average Ticket	$325
Diagnostic	$65
Repair Charge	$260
Labor Rate	$125/Hr
Billable Hours	1.0
Labor Charge	$125
Material Price	$135
Material Cost	$81
Material % of Total (Average Ticket)	41%

Bump the billable labor rate, 10% and the following results.

Average Ticket	$338
Diagnostic	$65
Repair Charge	$273
Labor Rate	$138/Hr
Billable Hours	1.0
Labor Charge	$138
Material Price	$135
Material Cost	$81
Material % of Total (Average Ticket)	40%

The total charge increased $13 or 4%. Let’s see the impact on the bottom line.

Gross Revenue	$831,818	100%
Cost of Sales	$440,000	53%
Gross Profit	$391,818	47%
Overhead	$320,000	39%
Net Profit (Pre Tax)	$71,818	9%

The pre-tax profit increased 80% or $32,000!

Of course, price increases might scare away customers. How many calls would this reduce? Let’s say 5%. That’s likely unrealistic. It would lower total company revenue. Yet, the company still makes more money!

Gross Revenue	$790,227	100%
Cost of Sales	$418,000	53%
Gross Profit	$372,227	47%
Overhead	$320,000	41%
Net Profit (Pre Tax)	$52,227	6%

The company would need to lose just over 8% of its customer base for the price increase to have a negative impact on the bottom line. In all likelihood, no one would notice. As Jim Kimmons, who developed the original Callahan-Roach flat rate system used to say, “If the customer’s upset at $338, would he be thrilled at $325?” The answer, of course, is no.

Increasing your prices a small amount, even during a recession, may have a huge benefit to your company profitability. And if you aren’t profitable, what’s your choice?

Surprisingly, many contractors hesitate to raise prices because they don’t want to order new price books. That’s the silliest notion of all. Who wouldn’t spend an extra $2,000 if they could be guaranteed it would result in $32,000?


2. Courtesy Inspections

Charlie Greer teaches service personnel how to perform a “courtesy inspection.” Friends of mine have used Greer trained companies, reported that the inspection uncovered other issues – some had been festering for years – resulting in higher tickets AND… happier customers.

At the end of the work, the homeowner spent much more than the original problem necessitated and thanked the service personnel.

Charlie describes his approach to a Plumbing Courtesy Inspection on his website. It’s worth the read…

Here’s the scenario: I went to the immediate problem that prompted the service call, checked it out, and said, "Okay. I can fix that. That won’t be a problem," thereby putting the customer’s mind at ease.

I then said, "You know, Mrs. Smith, whenever I come out to someone’s house, I always do a quick, courtesy inspection of all their fixtures and drains, just to see if there are any little free adjustments I can do."

Charlie proceeds to check stuff out, tighten things that are loose, clean aerators, and so on. In the process, he builds his value, builds customer rapport, and creates a sense of obligation. In the course of the inspection, inevitably problems or deficiencies are revealed. In many cases, addressing these now will save the homeowner a lot of money down the road. Other times, the problems are like open sores, festering and irritating.

Sometimes the homeowner knows the problem should be fixed, but lacks the skills, knowledge, or inclination to tackle the job. That’s where you crack team of professionals comes in. It’s why you were called in the first place… to solve problems the homeowner couldn’t solve for himself or herself.

Other times the homeowner isn’t even aware the problem could be fixed. Millions of homeowners live with comfort problems, unaware that it’s possible to have even and consistent comfort levels throughout the home.

Remember, no consumer knows all of the things you can do for them like you do. You offer products and provide services that could improve their lives, but you can’t keep them a secret.


3. Sell Service Agreements

This is another no-brainer. Service, or maintenance agreements are contractors between you and the customer to perform repetitive annual maintenance at discounted rates scheduled at times convenient to both of you. Service agreements help you fill in valleys of demand, keeping your service force working during slack times.

Because they are prepaid or charged monthly, service agreements also help with cash flow. And, they represent an unspoken agreement between you and the customer that the customer will do business with your company exclusively during the term of the agreement.

Service agreements are well accepted in the HVAC and pool industries, less well accepted in plumbing, and practically absent from electrical. Often, plumbers and electricians express skepticism about their ability to sell and maintain a base of service agreement customers. The trick is to build sufficient value that the service agreement is an obvious value for the homeowner.

Pool & spa varies around the country, but generally the contractors build up maintenance routes and then, incredibly, sell them. Why not keep the route and keep the future add-on, accessory, toy, and backyard oasis sales? Why not keep the future equipment replacements and resurfacing?

Call takers and dispatchers should start the service agreement sales process by stating at the appropriate point, “I’m required to inform you that we give priority service and discounts to our service agreement customers.”

Pause, and if the customer asks about the service agreement say, “You can save quite a bit of money with our service agreement. In addition to priority service and a ___% discount on repairs, the service agreement includes… [benefit, benefit, benefit]. The investment is only $______. Would you like to save money with a service agreement or simply schedule your repair today?”

Even if the homeowner refuses the service agreement, the stage has been set for field service personnel to repeat the offer. One of the best approaches is to use an apples to apples comparison sheet that compares today’s repair plus the service agreement with today’s repair plus the maintenance services covered by the service agreement.

© 2009 Matt Michel

Add Ons Work Like Magic

The easiest way to boost your company's profitability is to increase add-on sales during service calls. For a profitable company, the gross profit from an add-on sale magically falls straight to the bottom line.

Read the rest in a column I wrote for Contractor Magazine.