Did You Realize That Your Service Business Has Inventory?

What’s that you say? What have I been smoking? No, really, I’m not kidding you here. Service businesses really do have inventory they are trying to sell. Now before you think I’ve really gone off my rocker, let me explain…

A service has two main things to sell:

1. Time
2. Knowhow

And hey goofball, anytime you provide a service, you are selling both of these finite items. Let’s define what these mean…

Time: You do know that there are only so many hours in the day, right? You can’t add any more (unless you have some magical power). The only thing you can do to expand capacity is to hire additional service providers. And whatever you don’t sell at the end of the day is gone. Yep, that’s right. You can’t get it back once it’s gone. So it behooves you to sell as much time as possible until you reach the capacity of your service providers.

Knowhow: This is the sum of your collective knowledge gained through training and experience. It is your ability to do something for a customer that they can’t do themself. Whoa, that sounds heavy!! Well, it is. You are an expert, with unique knowledge and skills, and you have the unique ability to effectively deliver a solution to a customer problem.. So maybe you are a bit like a superhero afterall…

Service business inventory is no different than physical inventory. Still not convinced? Hmmm, you’re a tough one…

If you haven’t done it in a while, perhaps it’s time to take account of your service inventory. 

Is it time to get an eye exam? Let’s relook at your existing services?

• If you haven’t done this already, it’s time to list out your existing services. Why? Ok, I’ll tell you why… 
• When you strategically look at your service lines, you might find that you have services listed that you are no longer providing. Is that a good thing? Why did you stop providing them? Have you replaced them with something better? Is that something better really better?
• You might also have service capabilities that you’ve relegated to the back shelf where they are sitting there collecting dust. Maybe it’s time to dust them off and start selling them again.
• Are your business processes getting in the way of speeding up your services? Sometimes the way we do business can constrict how well you are providing your services. Are those processes stuck in inertia? Do they need an upgrade to speed things up?
• Is there a way to add technology to your current services to make them better,  to increase your efficiency in providing them, or to add additional value to customers?
• Are you effectively marketing your current services? Does your marketing need a refresh, or should you consider adding a new campaign?
• How well can your people provide your current services? Do they need additional training, or can they be cross-trained to provide more flexibility in scheduling?
• How well are you providing your services? Does the quality and timeliness match your current customer expectations? Can you upgrade them and make them better, and/or charge more?
• What is the profitability of your various service lines? Do you need to update your pricing

Got something new on your mind? What about adding a new service?

• You typically acquire new services capabilities over time. How? You see an opportunity to add a service for a client, or they ask if you can take care of something for them. You look at it and say, sure, we can do that. And then you begin to consider whether your other customers might like to have that done for them as well. So you launch a marketing campaign and let them know.
• Are they replicating or replacing old services that need to be dropped?
• Are you charging for these new services? Sometimes they slip in unawareness and become part of existing services. They might feel commonplace and not worthy of an additional charge. But is that really true? You might consider the CUSTOMER PERCEPTION OF VALUE, and not just yours to see if they warrant an additional charge. 
• Are your people capable of providing these new services? Do they need training or mentoring? Can you cross train them in the new services and technologies?
• Perhaps a new idea just fell into your lap, and now you’re considering 
• Every time you start new services, an investment of time, and sometimes money must be made to make the services available to your markets. Are you tracking the ROI of these new services?

Are you convinced that you have inventory now? So you see, it might not be as simple as you thought. 

If you need help evaluating your services (including profitability and pricing) let us know. We can help!!