At ServiceTrade’s 2022 Digital Wrap Conference, CEO Billy Marshall presented an innovative solution to a core challenge that’s top of mind for everyone these days—the ongoing labor shortage.
The statistics are concerning. For every two techs that retire each year, only one enters the field. But demand for your services continues to grow. So what’s the play? Billy offered this 3-step strategy:
Minimize demand work
Sell to better customers
Organize around the goal of keeping your techs on track
We’ll get to those in just a minute. First, an illustration…
The F1 Analogy
Watch this:
In case the analogy isn’t clear, your technicians are your race cars on the track. The growth and limitations of your business rely largely on the quality and efficiency of their work. But in a labor shortage, skilled technicians are a constrained resource. You can’t just go out and hire more techs. You can’t tag in another race car.
But you can innovate and build up your supporting team, your pit crew, your technology-empowered office staff and sales team. Employ as much administrative staff as you need to achieve one mission – keep the technician solely focused on doing the high-value, hands-on work that only they can do.
3 Steps to Growing Revenue Without Hiring More Techs
Minimize Demand Work
You can’t plan for demand work. It causes chaos and throws off schedules. Prioritize maintaining and repairing equipment with routine service. If you have customers who refuse to properly maintain or repair equipment, consider cutting ties with them, raising their prices, or deprioritizing their service.
Sell Better Customers
If demand for your services is high, make room for only the best customers. Good customers would much rather sign up for your premium packages than risk their equipment failing. Good customers want predictable operating expenses, not the unexpected and unpredictable cost of demand work.
Organize Around the Goal of Keeping Your Techs On Track
Take administrative burdens off of your technicians. Invest in your office staff. Make sure that everyone in the company understands the goal and is working toward optimizing technician efficiency. Software helps you do just that.
You can learn more about growing your business despite the skilled labor shortage by watching the full presentation.
ServiceTrade Acquires NorthBoundary
Combination connects critical selling and service workflows for mechanical contractors
The inaugural Mechanical Benchmark report shows that top performers grow 49% more and invoice 5.4x faster than peers
Ahead of next week’s Digital Wrap Conference, ServiceTrade, a leader in purpose-built software for commercial contractors, announced the acquisition of NorthBoundary, a pioneer in sales solutions for commercial mechanical contractors.
A selling system built for mechanical contractors
Today, many business development teams struggle to deliver maintenance and project proposals that meet corporate margin goals. This is due to the laborious and time-consuming process of searching for asset data spread across multiple systems and the lack of repeatable best practices resulting in long client delays and, even worse, proposals that run over budget.
A sales rep today can’t sit back and wait for an RFP; they need insights based on equipment data and industry standards to deliver accurate proposals that meet margin goals and create great customer experiences. Likewise, the sales manager can’t manage their team on intuition alone, they need access to critical KPIs like prospecting activity, quotes delivered, and bookings to have confidence in hitting the number.
“We started NorthBoundary to streamline the sales process for mechanical contractors,” said Vince Kugel, CEO of NorthBoundary. “Before NorthBoundary, creating a single sales agreement was a laborious process requiring manual steps that didn’t benefit from any intelligence. In addition, existing CRM tools were too broad for a mechanical sales team, so we inserted 30+ years of selling best practices into an application teams love to use.”
At the heart of NorthBoundary is the Proposal Engine. The platform harnesses industry expertise and standards to assess coverage and delivers accurate pricing that meets margin goals while optimizing resources.
With NorthBoundary:
An HVAC sales rep can quickly generate accurate proposals with a professional look and feel, and quickly close deals with an e-signature.
A project-based sales team can leverage libraries of past proposals, easily modify to customer requirements, and price projects based on margin targets.
A sales manager can understand the business’s key performance indicators, making real-time changes based on data vs. intuition alone.
“NorthBoundary has been a game-changer for both our sales team and senior leadership group,” said Jim Moscariello from The Tustin Group. “The software is very flexible and user-friendly which enabled our team to quickly adapt to using the platform to its full potential. Before deploying the platform, we struggled to gain granular visibility into our sales performance and future pipelines. Through the use of the robust automated reporting features we now have insights into our business like never before, and utilize the data to continuously improve our sales and operational performance.”
Today’s news and the recent Asurio acquisition make ServiceTrade a complete platform for commercial contractors’ operations.
“Proactive mechanical contractors see 49% higher growth than those who sit back and react to what the market gives them. Our mission is to help customer-facing teams focus on the most valuable work and minimize the aggravations and avoidable mistakes with better planning and data-driven processes,” said Billy Marshall, CEO of ServiceTrade. “We’re excited to welcome NorthBoundary to the ServiceTrade family. Together we’ll deliver a more compelling solution for mechanical contractors looking to drive productivity and revenue from all of their field-based personnel, whether it be sales reps delivering contracts or the techs completing the work.”
ServiceTrade’s new Mechanical Benchmarks Report shows the stark contrast between high and low performers
This acquisition comes against the backdrop of uncertainty in the mechanical contractor market. To truly understand what separates high-growth companies from their peers, ServiceTrade looked at anonymized transaction data in their platform of 1000+ customers and found:
Top performers are growing 49% more than poor performers and 31% more than middle performers on a year-over-year basis.
Top performers complete work on time 22% more often.
Top performers invoice 5.4x faster than their peers, with most invoicing in less than one day.
The “Mechanical Benchmarks Report” joins the “Business Growth Trends for Commercial Contractors Report” published in 2022. For more on ServiceTrade’s research on the commercial contractor market visit here.
Read more about ServiceTrade’s 10-year, 1000-customer milestone here.
Explore the ServiceTrade Mechanical Benchmark Report here.
10 Years, 1000 Customers
ServiceTrade Turns 10 Years Old
10 years and counting
Ten years ago, ServiceTrade was born when fire and life safety contractor DunnWell was sold. A proprietary internal project called ServiceNet became the jumping off point for an ambitious new product with a new company and a new set of customers paired with an operating motion that we knew intimately. We knew how to avoid all the old mistakes, so we plowed ahead and made new ones.
Along the way we got a lot of things right as well. We started with five employees, and we sold 30 new customers that first year. Fast forward to today, our tenth birthday, and we have 200 employees and 1,000 customers. Better yet we’re still committed to solving the same problems for that same customer set – commercial service contractors. If we were right about one thing, it was the type of customer we wanted to serve. It pays to have high quality customers.
Our tenth year was a big one for us:
Our customers generated a staggering $2.4B in new quotes for work.
We delivered game changing new innovations to help organizations better manage their parts and labor, released new mobile capabilities like offline mode to help drive technician productivity and greatly expanded our ecosystem with new partnership with Sage Intacct, NetSuite and Procore to name a few.
We even have a few surprise announcements left to make at this years Digital Wrap Conference, the only event dedicated to helping commercial service contractors grow their business.
These achievements feel good, but we remain in the early innings of a long game. There is a critical shortage of skilled labor in the markets that we serve, and we have an opportunity to help our customers close the gap between the sky-high demand for contracting services and the scarce supply of qualified technicians.
Every workflow in their business has room for improvement to remove wasteful effort and spending that does not deliver better technical outcomes for the facility owners. How can we help the best technical talent focus on the most valuable and enjoyable work and minimize the aggravations and costly mistakes that could and should be avoided with better planning and data driven service routines? Sounds like a good challenge doesn’t it?
So let’s get on with it.
We are continuing to invest to make us the most important technology vendor for commercial contractors in the fire and life safety, mechanical, electrical and plumbing markets. These markets represent a great opportunity for us, and we are focused on standing taller in these fields for these customers because we do not need greener pastures to achieve our growth ambitions. New competitors are emerging because they are watching our movie and they like the plot so far, and their turn on stage will twist the storyline and make the show more interesting for our customers. Welcome to the adventure I say. Catch us if you can.
The future is fun and bright. We’re committed to our corporate values as our north star and I am eager for the next ten years of challenging innovations and spirited customer engagements that make us and our customers better. We will continue to lead with game changing concepts like the Digital Wrap for customer engagement and leading edge technology for technician productivity and job satisfaction. No doubt we will continue to engage with technology partners in our markets, and we may even acquire a few of them as well.
All of this in service to a market that has selected us as their technology sherpa to climb the mountain of great customer service and thoughtful revenue growth.
Thanks for a great ten years, and the best is yet to come.
The combination will empower specialty contractors to reduce risk and streamline inspections.
Today, we’re excited to announce the acquisition of specific assets from life safety inspection software company, Asurio. Most importantly, we’ve acquired the technology and expertise behind the BirdDog Platform and the customers who trust it to speed the inspection process and reduce risk through enhanced compliance.
The team at Asurio has built a platform of the highest quality and consistently receives rave reviews from their customer base. With deep expertise in fire and life safety, executives who sit on key industry boards, and a comprehensive library of NFPA inspection reports, Asurio has been used in over 5 million inspections.
Software built with purpose
ServiceTrade began as an in-house software solution for a fire and life safety company. We saw a large gap between the current processes and systems used to run the business and the potential growth and efficiency that could be delivered through technology.
Today, there are many more field service and accounting/ERP software options on the market, but none that match our deep expertise and understanding of this industry’s critical business processes, regulatory challenges, and market conditions.
For over 10 years, we’ve been committed to delivering top value to our fire and life safety customers to help them reduce risk and grow their businesses. That’s why we’ve acquired Asurio.
By unifying the inspection process with other critical business automation in ServiceTrade, fire and life safety contractors will now have a connected operations hub to reduce risk, improve service margins, and increase revenue.
For example:
Techs can now perform inspections faster with fewer flaws.
Front offices can now extinguish (pun intended) double data entry.
Owners can now reduce overall risk and liability.
When combined with our market-leading ServiceForms product that automates inspections and tasking checklists for your technicians, the possibilities are endless!
Our success is your success
This news builds on an exciting year for ServiceTrade. We’ve recently expanded our team to over 190 employees. And, in addition to receiving growth equity from JMI Equity with participation from Frontier Growth, ServiceTrade is now trusted by over 1,000 specialty contractors who are contracting $3B+ in commerce through the platform.
Additionally, in the past 12 months, ServiceTrade:
Made the Mid-Market Fast 40 list by Business North Carolina based on revenue and employment growth.
Received an average 4.6 of 5 stars from satisfied customers on Software Advice, GetApp and Capterra.
Was named a Top Performer in both Work Order Management and Electrical Contractor Software on Capterra.
All of this reaffirms our commitment to provide best-in-class products and solutions while being the most customer-responsive company in the industry.
Want to learn more about ServiceTrade’s future plans?
Watch our informational webinar to learn more about the Asurio acquisition and how ServiceTrade’s new expertise and library of NFPA inspection forms can help you streamline inspections and reduce your risk.
What exactly is ServiceTrade acquiring from Asurio?
ServiceTrade is acquiring specific assets of the Asurio business including certain operating assets, intellectual property, naming rights, trademarks, and customer contracts.
Why is ServiceTrade acquiring Asurio?
By combining the deep expertise of Asurio with the full platform of ServiceTrade, we’ll be connecting the systems used for code compliance and risk reduction to those used for technician productivity, contract sales, and customer service. This will unlock even greater efficiencies than ever before, resulting in faster growth and higher margins for our customers.
What does Asurio bring to ServiceTrade?
For 15 years, Asurio has been a leading provider of life safety inspection software to speed the facility inspection process, and improve safety and compliance. Asurio is led by a team of recognized experts in the industry, and its software has been used in over 5 Million facility inspections.
What products and services does Asurio offer today and how will that change?
Asurio has a suite of products developed to help perform fire and life safety inspections and audits, manage and share the inspection or audit data, conduct detailed fire extinguisher and pump inspections, and manage deficiencies identified through the inspection process.
As part of this acquisition, we’ll combine the best capabilities and features of our existing ServiceForms product with the market-leading code and risk management capabilities of Asurio. This will be the most connected, flexible, and scalable platform to market for fire and life safety.
What about ServiceForms, does Asurio overlap with ServiceTrade’s forms product?
ServiceForms remains a key part of our product strategy as we scale both our fire and mechanical segments. We’ll manage both offerings while we look to combine Asurio capabilities in ServiceForms giving us the most complete product in the market for Fire & Life Safety.
Can I still buy Asurio software?
We will no longer sell Asurio software, but will maintain all agreements for existing customers.
Over time Asurio customers will be offered a migration path to ServiceTrade for their critical workflows and processes.
What does this acquisition mean for Asurio customers?
Asurio customers will become ServiceTrade customers and should expect the same level of exceptional customer service and support they did before the acquisition.
In the coming months, we’ll share more about the product roadmap and what customers can expect from ServiceTrade in the months and years ahead.
What benefit does this acquisition provide ServiceTrade customers?
Asurio is a recognized leader in the Fire & Life Safety market and a developer of software used in over 5 Million facility inspections to date. We look forward to learning from their experience, incorporating their functionality in ServiceForms, and deploying our Go to Market engine to continue our success in this critical market.
In addition, we’ll be offering a more complete offering to our joint customers, unlocking faster innovation, and reducing their risk, all from a connected, flexible, and scalable platform.
Raising Prices During Inflationary Times and Beyond: Part II
InPart I of this series, I shared my thoughts on how a service contractor’sDigital Wrap enables them to routinely raise prices while retaining customers. We talked about (a) the importance of consistently presenting your brand as a premium product and (b) providing a superior customer service experience. Here in Part II, we’ll talk about the operational component.
The 3 Operational Must-Haves for Routinely Raising Prices
Now that your Digital Wrap has set the expectation that you’re going to charge a premium price and keep raising prices in the future, how are you literally going to do that?
Operationally speaking, there are three must-haves for routine pricing adjustments: (1) service contracts that set clear expectations, (2) a capable contracts system, and (3) a solid process for implementing and communicating pricing increases. Let’s look at each of these in more detail.
1. Service Contracts That Set the Expectation for Pricing Adjustments
Do you have contracts with your customer that establish your ability to raise prices on a periodic basis? You should. Being transparent and talking about pricing from the very beginning is a good way to set proper expectations.
You certainly need to be able to pass along material price increases to the customer based upon fluctuations in commodity prices. Explain to the customer how you source parts and how they can expect you to be efficient, but if the price of copper is up 100%, they should expect pricing on copper parts to increase by 100%.
Similarly, you need to be able to pass on rising overhead and labor costs. Your service contract should clearly set the expectation that pricing will increase as you increase the value of your services. This ensures that customers are not surprised by price adjustments that are not directly connected to materials. It will also reinforce your commitment to continually improving your services.
2. A System That Can Account for Individualized Contract Agreements
If you do have contracts that establish your ability to raise prices, do you have a system that scales the delivery of prices to customer invoices based upon those contract agreements? When a customer rightfully negotiates a special rate due to volume or some other relevant factor, are you going to get it right when you create their invoices?
Each contract with any given customer should ideally be just a short list of exceptions from your master pricing, with each exception being triggered at an item or location level. When you alter your master agreement, your customer’s exceptions don’t change until their contract renews or is renegotiated.
Anyone in your organization should be able to generate an accurate invoice if the system has the capability it should have. If you cannot, schedule a call with a ServiceTrade representative to see what you should be getting from your contracts system.
3. An Automated Process for Implementing and Communicating Pricing Changes
Finally, updating prices to increase them (or decrease them in the case of falling commodity prices) should be simple and reasonably automated. Generally, the customer should get some sort of notification before an auto-renewal period, and perhaps there will be a discussion about the terms of the contract.
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With clear upfront expectations, a capable contracts system, and automated communication, you can successfully raise prices without a lot of fuss by your staff and without driving away customers.
And if your Digital Wrap has been active and customers can see all of the good stories about your services online, they cannot even consider terminating their relationship with you when the value of your brand is so transparent and obvious. A premium brand is worth the premium price.
Raising Prices During Inflationary Times And Beyond: Part I
What Should I Do About Inflation? Give ‘Em a Big Ass Price Increase!
The most efficient way to grow revenue in your business is to increase the price you charge for the services that you provide. Sounds easy, right? Well, it can be if you understand the underlying psychology of buyers and you have the operational capability to adjust prices easily across your business. The keys to successful pricing adjustments are:
An expectation on the part of the customer that your brand is worthy of a premium price.
A customer service approach that demonstrates value beyond the price of the service.
Operational capability to implement price adjustments seamlessly.
In this article, I’ll focus on commanding a premium price and demonstrating value through customer service. You can catch my thoughts on operational capabilities in Part II.
Inflation sets the stage for a price increase
Inflation rose 7% in 2021. Fuel prices rose a remarkable 58%. The price for trucks and cars is up between 10 and 30%, depending on the category. How easy has it been for you to raise prices for the services you sell to your customers?
Let’s start with this inflation excuse as a case study for customer reaction when they expect price increases. When all of the news outlets in America are braying about the highest inflation since 1982 and every Tom, Dick, and Harry is paying $15 for a burger and fries at 5 Guys, most folks will expect their vendor bills to be more pricey. When higher prices are all around you, it is difficult to single out a particular vendor for a protest over a price increase. The inflationary environment and all of the market symbols that go with it has set the stage for the price increase.
But how do you increase prices without help from these inflationary symbols?
How do you create symbols that confer an expectation on the customer that prices will be on the premium side of a fair trade?
Well, you do it by placing your own brand symbols in front of the customer everyday to reinforce the idea that you deserve to be paid more because of the way you do business. If the customer sees images of your brand everyday that are consistent with premium service, they are unlikely to protest when your invoice arrives sporting a higher price than they paid last year and one that is higher than the competitor down the street would likely charge. And then, they pay it.
Ideally, you are doing things differently to elevate your brand above the minimum commodity status where price is the only determinant of value. If you do not want to compete on price, you need to develop a premium brand, even if customer expectations for the products and services you deliver are generally low. How do you overcome commodity expectations? Let’s look at an example from a commodity market.
The Big Ass fan example
My first experience with a Big Ass fan was in an open air concourse at the airport in Punta Cana, Dominican Republic. This thing was huge! And it worked well also as I was there in August when it is hot and humid, and the fan in the open airport made a big difference.
Big Ass is a good case study for price expectations because generally speaking there is nothing more commodity than a fan. The market for fans generally should be one where price is the ultimate determinant of value. Yet when I recently went looking for a fan for an outdoor kitchen project, I totally expected the Big Ass version to cost significantly more than the competition. My expectations were met and exceeded.
A Big Ass fan at the Punta Cana airport
An 84 inch HVLS (high volume low speed) fan in oil rubbed bronze can be found online for less than $1,000. The comparable Big Ass versions will run between $2,000 and $3,000 depending on options. Really? For a fan? Why not? And people with the money will pay for it because they trust they are getting a better product and better customer service with the Big Ass brand.
I expected the Big Ass brand to command a premium (I was a little shocked at the 100% plus premium to be honest, LOL), but how did I come to have that expectation? What did they do to prime me to pay so much more for their product?
First, the brand caught my eye years ago in Punta Cana. Of course the name created a conversation among the people that were traveling with me (creating a conversation is good branding, btw). What did we do? Picked up our phones and began searching around for Big Ass information.
What did we discover? An interesting story, of course. The company began cooling cows, who apparently will eat more and produce more milk if cooler. Soon the company branched out into other industrial settings like warehouse distribution centers and open air applications like the Punta Cana airport and amusement parks.
The name came about from customer calls asking if they were the manufacturers of “those big ass fans.” The mascot, Fanny the ass, is ever present as both a part of the logo as well as numerous statutes on the Lexington Kentucky campus.
The company pays premium wages to employees, invests heavily in research and development, and has about 10,000 applicants for every 200 job openings. And the website sports customer reviews and makes it super easy to buy really expensive fans direct from the company. All of this information was readily available online from multiple sources.
Takeaways for commercial service contractors
So how are we going to use this review of Big Ass to teach your customers to expect big ass price increases from your company?
Lesson 1: Do something uniquely well. Do not try to serve everyone with the same old thing. Big Ass started with cows and industrial settings. These were unique markets that were likely underserved, but with a terrific value proposition for the customer: low cost cooling relative to the alternative of conditioned air. Who cares if the fan is super expensive when the alternative technology is prohibitive. Focus on a unique capability for a unique market.
Lesson 2: Tell an interesting story online. We talk about this all the time, but your Digital Wrap is really important. Your technicians gather lots of “stories” everyday with the work that they do. Get that story into the hands of your customers and prospects via your online marketing impressions (MIPS). If you don’t know what I am talking about, you really need to spend some time with ServiceTrade.
Lesson 3: Be transparent and available online. Big Ass publishes reviews on their website, including the poor ones. Several of the reviews indicated the way that the company recovered when the product failed to meet expectations – the customer service response was terrific. Also, it was easy for me to engage directly to configure and buy a fan online. It should be easy for your prospective customers to qualify themselves for a purchase or sales call from you using your website. Have you tried it lately disguising yourself as a customer?
Lesson 4: A premium price pays dividends in employee loyalty. You cannot build a premium organization if you do not charge a premium price. There is not enough money to go around. The customers have the money you need (as opposed to cutting corners in your business). Find a way to take it from them and pass it around your organization. You will find that your organization becomes better at taking more when you take care of them. Did you see the statistic on applications for jobs at Big Ass relative to openings? How would you like to have that problem?
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High inflation is not the only excuse for a price increase. A premium brand is the other excuse that works every time all the time. So get your Digital Wrap going and give the customer a Big Ass price increase as often as your contracts allow.
Five years ago, Shawn Mims and I wrote a book called Money for Nothing: How a Digital Wrap Earns More Pay for Less Work. We did that because we felt we needed a clever way to get the attention of a market that was generally not inclined to adopt new technology – commercial service contractors.
“Money for Nothing” was a play on the Dire Straits song that describes the lamentations of the blue-collar worker as he observes the success of the rock star. The rock star gets the money and the girls for doing “nothing.” We noted, however, that the rock star has a great business model – selling the stuff that makes us feel good.
For the contractor, when everything goes well and “nothing” ever happens at the customer – no breakdowns, disruptions, unplanned emergency work – how can he or she earn a premium? The answer was simple: give the customer a good story online demonstrating all of the great work that went into all of that boring “nothing” that is the best outcome for everyone. The customer gets a great story that makes them feel good, just like the rhythm and rhyme of the rocker.
I am pleased to announce today that our clever play on words worked, and ServiceTrade has become the market leader for customer service technology for the commercial contractor. Our money-for-nothing strategy has scored us some serious money for something.
JMI Equity has joined existing investors Frontier Growth and Bull City Venture Partners in sponsoring the next leg of growth for ServiceTrade to the tune of $85 million. [read our news release] That’s not just nickels and dimes. It is a commitment at a level that will allow us to deliver more cool technology solutions and more thought leadership to help our commercial contractor customers sell more services, charge a premium price, and hold onto customers longer. Helping the contractor build a premium brand is the something that gets us going every day. And now we can do more than ever to fulfill that promise.
I am thankful today for my co-founder, Brian Smithwick, ServiceTrade’s CTO, and all of the terrific employees that have joined us in our commitment to building technology for commercial contractors. I am thankful for the 800-plus customers that encourage us every day to do our best, and who also thank us for being their partner. It feels good, like a great “Money for Nothing” song. So let’s get after it and build something with that money-for-nothing haul.
News from ServiceTrade: New Partnerships With Frontier Growth and Bull City Venture Partners
I am very excited to announce today that ServiceTrade has partnered with Frontier Growth and Bull City Venture Partners to accelerate our technology innovations for the commercial service contracting market. I, my co-founder Brian Smithwick, and all of ServiceTrade’s employees are energized by the opportunities for growth that these two partners bring us with their capital and expertise. We would not be in this enviable position, however, if it were not for the investments and encouragement we received from our customers in the early days of ServiceTrade.
Just over five years ago, we were at a crossroads. ServiceTrade had signed about 100 customers in our first two years selling our application, which was a very satisfying achievement for certain, but breakeven cash flow was still nowhere in sight. The revenue from our customers was not enough to fuel the level of innovation we wanted to deliver to the market. We had big ambitions, and we needed more capital.
Looking Back to 2015
By 2015, Brian and I had spent enough time with commercial service contractors to understand the quality of their businesses and the relative lack of options, or in many cases poor quality options, they were being offered by technology partners. Explaining it to early stage venture capitalists was difficult because measuring the total available market (TAM in venture speak) was challenging and imprecise. Quantifying the TAM for the commercial service contractor market to the satisfaction of a venture investor always felt like a fool’s errand to us – obviously it was big, but there was scant data that would convince an institutional venture capital firm to allow us to honor our commitment to focus exclusively on commercial service contractors. Brian and I firmly believed that success in the market would only come from focus and discipline regarding the customer base. We knew the opportunity in our chosen market was rich, significant, and an exciting area for meaningful innovations. But how could we fund the engineering investment that was required to do it the right way?
We turned to our customers. Not for more revenue (although that happened over time as well), but instead we asked them about their appetite to invest in ServiceTrade directly. We targeted a select few customers that had aggressively and thoughtfully engaged us during both the sales cycle and throughout their subsequent adoption of our platform. We were also careful to focus on successful entrepreneurs who had plowed similar ground to the sod we were busting. They jumped at the opportunity. Within a few short weeks we had access to all the capital we needed – on terms far friendlier than would have been offered by a venture capital firm. Along with the capital, we also had the guidance of expert and committed customers to take ServiceTrade to the next level. We put our head down and went to work.
Jump Forward to 2020
Our customers were killing it using our technology, but we wanted to deliver even more innovations to them more quickly. ServiceTrade was generating plenty of cash to fund operations, but we felt the market would support a more aggressive approach to growth than we could fund through our operating cash flows. Brian and I along with our employees really wanted to go for it with new technology innovations. Our track record of growth proved the value of our highly verticalized focus and there was now zero skepticism from the software growth investment crowd. This time we could invest our energy in finding the right partner among a sea of interested parties instead of legitimizing our market focus. We needed a firm that specialized in vertical software as a service (SaaS), and we also wanted one that would respect the quality of the businesses represented by our commercial service contractor customers.
Bull City Venture Partners helped us in the process by initiating a bridge investment about a year ago, and it turns out the timing of that capital was great due to the challenges presented by the COVID-19 pandemic. I cannot thank Jason Caplain and David Jones enough for their commitment and guidance.
Frontier Growth stepped up quickly in the process and worked with us through the challenges of the pandemic to build a plan that made sense for their investment thesis and our existing investors and employees. From the first meeting when Richard Maclean came to our offices during our annual low country boil celebration last fall, the folks at Frontier impressed both of us with their integrity as well as their appreciation for the competitive advantages that come with a vertically-focused strategy. The Frontier partners love vertical SaaS, and they are committed to the level of investment that yields the type of growth that we believe is possible with this dynamic and underserved set of high value businesses – commercial service contractors. Just like ServiceTrade, Frontier are specialists, and they are committed to their craft.
The customers that believed and backed us initially are thrilled about the new partnership as well. They will always be the biggest cheerleaders for our business because we happily take their cues on what creates value in their business and deliver the technology goods, but they no longer need to be on the hook to fund all of those innovations. They will get more innovations faster while simultaneously having the satisfaction that comes from looking back upon a great investment decision. It doesn’t get much better than that.
We are doubling down on innovations for commercial service contractors, and we are ready to take ServiceTrade to a new level because we have partners that know exactly how to help us get it done. I am looking forward to meeting the new hires and the new customers that come with this type of success. I want to extend a big thank you to all of the employees and customers that brought us to this opportunity. Now let’s push down the accelerator and look for signs pointing us to the next crossroads.
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Contact Shelley Bainter 919-825-1562 shelley at servicetrade.com
What Software Buyers Can Learn from Agile Development and Lean Manufacturing
Software companies long ago abandoned complex release processes where comprehensive new versions would show up every few years. So why do software application buyers continue to plan for and tolerate implementation schedules that span several months or in some cases even years? What’s good for the goose is good for the gander, and software buyers need to wisen up and stop being lulled into an unreasonably long technology implementation that will almost certainly not yield the benefits promised during the sales cycle.
What is Agile?
Agile development has been a mainstay in software development for at least ten to fifteen years now. It coincides with the rising popularity (and dominance these days) of software as a service (SaaS) offerings. The basic premise of agile development is that you deploy new technology frequently with the smallest amount of incremental code possible. Agile development also gave birth to the popular notion among technology startups of the minimal viable product (MVP). In all these cases, the idea is to do and learn and do and learn and do and learn – over and over again. Here are the four key principles of agile development from the agile manifesto:
individuals and interactions over processes and tools;
working software over comprehensive documentation;
customer collaboration over contract negotiation; and
responding to change over following a plan.
These principles contrast with the historical waterfall method of software development where you plan and plan and plan and plan and plan and code and code and code and code and code and then deploy and OH SHIT! NOTHING IS AS WE EXPECTED!!! HOW DID THIS HAPPEN?!!
Agile is so popular because waterfall is simply broken. For so many reasons, but primarily because planning is filled with the flaws of confirmation bias. When development teams have lots of time to plan and code, they avoid real feedback from the market for extended periods of time and just do what they want to do. Agile and MVP concepts force the issue of a reality check as quickly as possible. It’s like the Japanese concept of lean manufacturing: reduce the amount of work in process inventory and you will find the flaws and waste in your manufacturing process. Funny how all these industries, from software development to manufacturing, all ultimately arrive at the same wisdom over time.
Use Agile and Lean Concepts for a Smoother Software Deployment
It’s time for the folks that buy and deploy software to learn from these agile and lean concepts. I cringe every time I hear about a potential customer’s long planning and deployment cycle for a new software package. When they are thinking in terms of several months or even years before the first system capability hits production, they are not thinking about the problem the right way.
The problem
Planning for the perfect system that does everything is the enemy of real progress that could improve the business tomorrow. First, you will inevitably not plan for several things that could improve the business because you have confirmation bias in believing that you really understand what will actually improve the business.
Second, the thing that you believe should improve the business (although it might not) will undoubtedly work differently in production than the staged demonstration that you observed. You simply cannot plan for success when the scale is too big because few organizations (none) have the resources to actually plan and deploy at large scale. It just doesn’t work for all the same reasons that software developers abandoned waterfall and embraced agile.
The solution
So what is the solution? Simple. Small and incremental deployments of minimal viable technology functions that deliver well defined outcomes (a minimum viable deployment, MVD if you will). And then another deployment. And another and another and another. In this manner, any singular failure is quickly discovered and quickly modified to address the flaw that was not visible in planning. The failures will also tend to be small and minimally disruptive. As the principles above direct, let people do, learn, collaborate, and correct instead of thinking you can plan your way to large scale successes.
3 Tips to Put Into Practice
How might this work in practice? First, constrain the timeline to have something, anything, deployed in production and improving the business. Any schedule longer than six to eight weeks from initial kickoff to first production output is too long. Narrow the scope until you can hit the schedule target. You can narrow the scope by feature winnowing or by narrowing the portion of the organization that faces initial adoption.
Second, don’t be overly concerned about integrations and optimizations until primary value is achieved. Primary value is NEVER the elimination of gaps between systems. Primary value is always something more fundamental like faster quoting, easier payment of invoices by the customer, easier scheduling due to a map or routing feature, a better sales demonstration, and/or faster communication to technicians through mobile dispatch.
You can always streamline administration between systems AFTER primary value has been achieved. I cannot tell you how many folks buy on the value of “integration” only to discover the integrated solution is a horrible piece of software that fails to deliver the primary value they were seeking. When the primary value fails, the promise of integration is worthless.
Finally, just say no to any vendor that proposes a huge services implementation requirement for your organization to see first benefit. Force them to absorb the risk or rescope the project until you see value in six to eight weeks. This will eliminate most of the failures you are likely to encounter BEFORE you spend a bunch of money for the simple benefit of learning from a failure.
Forcing the discipline that has made agile development so popular onto the application purchasing and deployment process will speed deployments, minimize expenses and failures, and maximize the amount of innovation your organization is able to absorb. Pay close attention to the key principles of agile enumerated above as you plan your next software purchase and deployment, and I bet you will get a far better result for your organization.
The Economic Downturn is Coming. Are You Ready for Greedy Growth?
Trade wars have sent steel prices up twenty five percent and farmers are getting killed by the collapse of the agricultural commodities market. Job growth slowed to a paltry 75,000 in May, and the two prior months of April and March were revised downward by 75,000. The European Central Bank is already easing monetary policy and hinting at future stimulus measures to fend off weakness in the Eurozone economy. Jerome Powell, the head of the US central bank, just telegraphed a rate cut. Brexit is a mess with all manner of political and economic uncertainty driving the UK economy into a contraction. Chinese investors are pulling out of the US real estate market due to retaliatory regulations associated with the trade wars.
A downturn in the economy is coming. It always comes, and the signs are everywhere that the happy days are close to an end. When the easy-money construction market dries up, will your contracting business still be poised for profitable growth? Will you be ready to take advantage of your weak competitors? Or will you be one of the weaklings that struggles to keep the wheels on the bus as competitors sharpen their knives in the battle for the stability of a highly profitable service business?
Warren Buffet is fond of saying “When others are greedy, be fearful. When others are fearful, be greedy.” What steps should you take to exercise fear now and be greedy when the downturn comes? Here are some ideas to prepare for greedy growth during the downturn.
Lock In Service Contracts Now
The last thing you want during the downturn is for your best customers to be shopping for service or responding to the desperate sales pitch of the low price competitor who is getting killed in the downturn (and hence getting more desperate and lowering prices even further). Customers can always breach a contract, but most will not want to do that, or they will simply ask for some consideration (payment terms, maybe a slight rate cut) in a down economy. Get on the right side of this negotiation now by offering a good contract that commits you to the services that will keep their facilities in top shape during the boom times when others are out chasing new construction opportunities.
Optimize Website SEO with Reviews
When the weak competitors begin to go belly up, or more likely they fail to make payroll and their technicians begin looking for the next opportunity, you want your company to be the number one hit (and number two and three and four as well) on the search engines. The downturn is prime-time to lock in new technicians who discover their employer is a weak player. They will be looking online. Will they find you? They will if you have your online reviews juicing your SEO results.
Get Your Careers Page Looking Spiffy
Hiring is difficult, but it is even harder when no one knows what types of positions you are offering. Always list openings for skilled technicians on a careers page on your website. Be specific about the skills that you value and the unique capabilities of your company, including any special technology capabilities that you deploy in service to your customers. Being specific about these things is better than simply declaring your company is better because you work harder, care more, been around longer, love mom and apple pie and blah blah blah.
Upgrade Your Customer Service Technology
When competitors begin their desperate attempt to keep customers at all costs, you want to be the one that has the most leverage in the fight for keeping the best customers. If you have put in place systems that help you understand customer contract performance, equipment maintenance condition, and technician productivity and revenue performance, you will be in the best negotiating position possible.
You will be able to reward good customers that follow maintenance protocols and repair recommendations with better rates while letting the customers with a history of poor maintenance and disruptive emergency calls fall to the competitor. Let them have the aggravation and low rates for these customers.
You will also be able to provide more competitive rates when you can use technology to maximize technician productivity and minimize wasted unbillable time. If you can increase their billable productive time by 10%, you can lower rates by 10% if necessary to keep the good customers from making a mistake and switching to Desperate Don.
Offer Customers Unique Capability and Insights
Although this is a capability that should be part of your customer service technology upgrade, it is worth mentioning as a separate item. In a world of Amazon and Uber, customers will expect their suppliers to give them more than just the labor and parts they bargained to buy. They expect information and insights as part of the customer service experience, and they expect them to be delivered online.
Challenge the customer that is about to make a mistake by switching to Desperate Don to make Don prove that he can provide the unique, information based and convenient experience that comes with your service. If the customer works with Don, can they:
See evidence of the work performed online?
Review and approve quotes online?
Review equipment service and repair history online?
Request service online?
See the progress of the technician online as he executes the maintenance routine on a complex site?
Maybe they will turn Don’s desperate offer down when he cannot provide any of this customer experience value.
Are you ready to be greedy when others become fearful? The key is having the confidence that you are operating with the best information to provide the best experience with maximum technician productivity so that you can aggressively hire and sell. When you know that the sale is going to stick and technician productivity is going to be high, you can hire and sell and hire and sell when others are struggling and become tired as hell of trying to figure out how you do what you do. Let’s hope the downturn is soon so the best competitors can wipe the floor and benefit from some greedy growth.
