Efficiency Metrics
One of the most important metrics we are trying to improve is our efficiency score. How do we measure efficiency? For us it’s a measure of daily revenue divided by number of techs working each day. Right now we only have one tech so the calculation is simply just a matter of how much revenue did we bring in each day.
Some days are good. Some days are not. The question is what are the factors that make it a good day or bad day? For example, a good day might be one where we just show up to the job and start doing the work and get a decent amount of revenue for the job. A bad revenue day might be a day where we do a ton of free inspections and we don’t get the time to do any repairs or sell the individual on the repairs before we have to run to the next job. On those days we end up with a lot of free inspections but no revenue.
There are others factors which also impact efficiency. For example building relationships with the customers takes time and may ultimately lead to higher sales or more repeat customers but on the short term side of things it does reduce your efficiency. I find I spend a lot of time teaching irrigation best practices and explaining why we do certain things the way we do. Many customers appreciate the education and better understand how we can help their lawn. This builds trust and many people who I have taken the time to talk to have said they would definatly call us back to do more work for them because they trust us.
An example of spending time with the customer is exemlified by a recent experience. On a particular day I spent a lot of time talking to two individuals and only brought in $390 in revenue (a poor day for us). Does that mean that it wasn’t worth it to talk to those customers for as long as I did?
Maybe not as long as I did. But because I was out there talking to one of the customers someone who was driving by stopped and said they needed work on their sprinklers and asked for business card. At the same time the customer I was talking to said we were great to work with and he would definitely recommend us. Sure, we didn’t reach our revenue goal for the day, but we did make a new contact and may possibly have more business with the drive by, but also the customer and I built a common bond and since then we have been back a number of times to work on their yard. Over the course of our interactions we have collaborated with them on things we can do to help get their yard green and looking good, even if it will be over the course of a number of months. The lifetime value of that particular customer is high because we have taken the time to communicate and work with them and their particular situation.
Photo by Luke Chesser on Unsplash
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