Facebook Twitter LinkedIn Google+

Increase Service Technician Profitability

Originally published: 03.01.16 by Ruth King

Service technicians are your company's eyes and ears in the field. They're driving trucks with your company's name on them, and you hope they're representing your company the way you want them to. Are they saying the things you want them to say? Are they diagnosing and repairing the systems the right way? Are they profitable for your company?

Each of your service technicians should be a profit center for you. Each should have revenue goals, billable hours goals and net profit goals. They don't impact the overhead significantly, so they're measured on their gross profit per month. Here are five ways to increase technician profitability:

Billable Hours

Great technicians are productively billing at least 6 out of 8 hours each day. If you're on flat rate pricing and have included the drive time, the technician is billing 8 hours each day.

Technician raises and bonuses should be partially based on the number of dollars that service technician is bringing into the company every month (technical competence, customer service and recommendations also count).

Track and Post

You should track and post the following: revenue per truck per month and billable hours per month

No service technician wants to be on the bottom in

either category. They will start competing against each other. The revenue for the department will rise and the billable hours will rise, thus increasing profitability.

Service Tickets, Call Backs

What recommendations did the technicians make? Does a technician always have the same repair? What were the callbacks and were they preventable?

A technician should have less than one callback per month. For warranty calls, what type of warranty call was it? If it was installation related, then you may have an installation issue to resolve.

By reviewing each technician's service tickets, you'll see a pattern and notice whether there are areas of technical weakness. If training is needed, there are many training programs, both on-line and in classroom provided by manufacturers and suppliers.

Maintenance Agreements

Each service technician should have a yearly maintenance enrollment goal. To reach this goal, each technician must believe in your maintenance program and perform the maintenance on a fellow technician's home on company time. These will be some of the best maintenances performed because the technicians know that a fellow technician is judging their work.

The more maintenance agreements, priced properly, the more service and replacement work the company will have. More work means less downtime.

Soft Skills

If your technician is doing the right things the right way, then he's educating the customer about system issues. He has their best interest in mind and understands it's the customer who writes his paycheck. You, as the owner, may sign it but there are no paychecks when there are no customers.

Your technician is properly diagnosing and finding the disease rather than only the symptom of the disease. He is recommending repairs or replacement when needed. This saves time, frustration on the part of the customer and the company and money.

Great technicians believe in maintenance and always recommend a maintenance agreement if the customer is not enrolled in your maintenance program. They also record everything they measure, good and bad, and make the proper recommendations to the customer.

Great technicians ask questions. They look for pets, smokers and hot and cold areas. They try to help the customer be more comfortable in her home. While doing this their revenue per service ticket increases. The increase in revenue drops directly to the bottom line.

Implement these five actions to increase your technician productivity.


Ruth King is president of HVAC Channel TV and holds a Class II (unrestricted) contractors license in Georgia. She has more than 25 years of experience in the HVACR industry, working with contractors, distributors and manufacturers to help grow their companies and make them profitable. Contact her at ruthking@hvacchannel.tv or call 770-729-0258.


About Ruth King

Ruth King

Ruth King has over 25 years of experience in the hvacr industry and has worked with contractors, distributors, and manufacturers to help grow their companies and become more profitable. She is president of HVAC Channel TV and holds a Class II (unrestricted) contractors license in Georgia. Ruth has written two books: The Ugly Truth About Small Business and The Ugly Truth About Managing People. Contact Ruth at ruthking@hvacchannel.tv or 770.729.0258.

Articles by Ruth King

Two Steps to Help You Grow and Build Wealth

Accurate books mean better decisions about your business future.
View article.


Profit or Wealth?

Looking at a balance sheet is more important than looking at a profit and loss statement. You build longevity (i.e. wealth), by building a strong balance sheet. From a business perspective, you cannot build wealth without profits.
View article.


Recurring Revenue is Your Rocket Fuel

Whether residential or commercially focused, all companies need a thriving maintenance program.
View article.


You Can’t Take a Percentage to the Bank

What matters is the bottom line dollars or that the gross margins are consistent.
View article.


Inventory is a Bet

Profitable contractors do two things extremely well: Manage labor and manage inventory.
View article.