1) The #1 Reason is Relocation.
Dealers have more control than you would think. Statistics show that many “moves” are “move-ups” to larger homes in the same area. If you have happy customers, you should expect to keep them if they move within your service area. You also have the opportunity to gain a new customer as a new owner moves into the location you currently serve.
2) Service and Billing Problems.
Dealers have near complete control over these areas. Sometimes there are unavoidable mistakes or customer expectations are not met. But what distinguishes the leading companies is the fact that their employees are: a) aware of the problem and, b) in a position to fix them in a respectful manner. A 1995 U.S. News and World Report Survey highlighted that 68% of customers quit because of an attitude of indifference by an employee or specific department. Often it is not what you do, but how you do it.
3) Affordability.
Successful Dealers sell “solutions” to problems. A range of security solutions and price points can be offered to meet customers´ needs. “Low dollar down” options often get expensive with add-ons. A solution can be tailored to ability to pay.
4) False Alarms.
While Dealers cannot directly control false alarms, they can be instrumental in monitoring their frequency and identifying ways that customers can reduce them. Beyond the inconvenience factor, more and more communities now impose substantial fines for repeated false alarms. As such, dealers should be proactive in working to reduce the incidence of false alarms in their client base.
5) Bankruptcy.
Dealers do not have control over attrition that occurs as a result of customers who go out of business or file personal bankruptcy. Through consistent slow pay or no pay policies, however, dealers can limit their exposure. Up-front credit scoring, D&Bs, or reference checks can also mitigate losses.
HOW CAN CORNERSTONE HELP?
Cornerstone´s Billing and Customer Management System provides frequent customer communication using the invoice – front and back – as the vehicle. The system also streamlines your billing process and enhances cash flow.
Use your customer database and invoices to reduce attrition and build the value of your account base:
Proactive Move-out /Move-in Program. Minimize attrition caused by relocation. Make it easy for customers to let you know their plans to move and provide incentives to sign up for service.
Customer Feedback Mechanism. Survey your customers to know how you are doing on installations, service calls, monitoring and overall service. What you don’t know can hurt you — what you do know, you can fix.
Happy Customers Generate Referrals. Solicit referrals from your customers, and reward them for doing it.
Easy to Understand Invoices. Minimize billing questions and enhance cash flow.
Customer Communication. Provide your customers with useful tips and information. Understand their needs as they change. Keep your company top of mind. Let them know you care.
In a business where recurring revenue drives value, increasing customer retention and creating customer loyalty go a long way toward maximizing the value of your business.