When running your business, you should always know what factors to be looking out for and paying the most attention to so each job can go smoothly. Which is why using the right toolset can make a major difference in your business's overall success. For instance, implementing the right toolset can lead to a boost in customer retention, heightened levels of motivation among your team and technicians, and even an uptick in revenue. To completely understand some of the most important field service metrics, we have listed the following below:
Customer Acquisition Cost (CAC)
CAC can be calculated by dividing all the costs spent on gaining more customers (marketing expenses, etc.) by the number of customers acquired within that period of time where the money was spent. You will notice that CAC limits will vary from time to time. These limits will eventually provide you with a benchmark for the average cost of a new customer.
Davisware Tip: If your CAC is high, you could be spending too much on potential clients!
This metric can refers to customer turnover. Attrition is the calculation of the number of individuals that leave a larger collective group over a certain time frame. In other words, it takes into account how many customers have stopped paying for your services and provides insight into your revenue stream. For example, you can see if you are delivering exceptional field service, or if some improvements need to be made! Most businesses will commonly reflect at 30, 60 or 90 days to get exceptional feedback.
Davisware Tip: When asking an inactive customer why they stopped paying or canceled a particular service, think of this as an excellent opportunity to try and bring them back on board!
It is EXTREMELY important to attend to your loyal customers as they're the ones who continue to support and believe in your business. If you begin to neglect your current customer base, losing their business is a possibility, and your steady profits suffer. Retention gives you an accurate idea of your customer satisfaction with your company as a whole, instead of just individual departments.
Davisware Tip: Keep in mind that it's more expensive to acquire a new customer, as opposed to retaining a current one! Keep an eye on how many customers you’re losing compared to the amount you're gaining!
Lifetime Value (LTV)
Essentially, this is a prediction of the net profit you expect to earn over the entire future relationship with a customer. To calculate this metric, you will need to know how long the average customer stays with your company and then multiply the monthly revenue you'd expect in order to get their Lifetime value.
Davisware Tip: Make sure to subtract expenses from the total you spend on installation and maintenance to give you a clear idea of how much your brand is investing in active projects.
Last but certainly not least, revenue! Which is where you keep track of the total amount of income your business has from its sale of goods and services to customers. The most common form of measuring revenue is by sales or customer acquisition, but keep in mind there are other factors as well. For example, interest, late fees, service fees and more!
These 5 metrics are all used to help improve and understand your business. In order to improve, you must understand what need to be measured. It also helps to have a deeper understanding of the analytics capabilities your field service software provides.
Keep in mind, it doesn’t matter what industry you work in, or the size of your business. Whatever the case, field service metrics, like monitoring, reporting and analytics of this data, are extremely important to continually growing your business.
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