Updated: Feb 16
As a service-based business, one has to be more cognizant of best business practices than a product-based business. In many cases, you and your employees are your business, as you are the product - yourself. This seems to get lost on many small businesses that provide services, especially ones with a high demand for their service, as they operate like you are doing them a favour for doing business with them. There are several industries where this can be seen. Unfortunately, clients have very long memories, and though you might get the job, there is the adage of having a good experience, tell one person, have a bad experience, tell 10.
I am currently teaching a business course for Trades at an Ontario college, which focuses on the importance of setting up your business correctly, distinguishing yourself from others in your profession, developing the right policies and procedures and the importance of ethics in a service-related industry. It is an excellent course that almost any service-related business could benefit from taking. There are live case studies that show a potential business owner what can eventually happen by not making customer service your top priority in your business.
We moved to a smaller town, and getting any service performed on your house is nearly impossible. In most cases, you are lucky if you get returned call. Many times, these same individuals do not have a website or customer ratings on Google. If they do set an appointment, the chances of them showing up are few and far between. We even had one come and spend maybe 10 minutes after cancelling two times. He only provided a quotation after chasing them for a month, and his excuse was that he was too busy. It was so outlandish that you wanted to ask why they didn't just say they didn't want the job. Unfortunately, when there is a high demand, there are businesses out there that can end up tarnishing the reputation of those that run a reputable company and provide quality work and excellent customer service. A successful service business starts with how you want to set up and run your business from the beginning. You can do nothing about those who don't, but in the long run, you will win out over them.
Items to Consider When Setting Up a Reputable Service Business
Trying to provide services under the table to most makes most customers question how reputable your business is and what you are trying to hide. Set up your business correctly with a business number and an HST number. Make sure to apply for other numbers as appropriate such as WSIB and payroll.
Use the right systems to run your business. This includes an accounting system, CRM system, job tracking, and payment services system for accepting credit cards/debit. The systems used are very dependent on your business. Clients are growing leery of paying cash for services as they have no proof of purchase if anything goes wrong.
Hire the right professionals such as an accountant and a corporate lawyer.
Set up a mission, vision, code of ethics and policies and procedures that you expect your employees to adhere to and abide by with your customers. Employees must know what your business stands for and deliver the service as if you were providing it.
Set up a website and the appropriate social media accounts based on your target market. Many customers will not do business with someone who does not have a website as the company does not look legitimate. This fact is especially true with a target market under 40 years old. They tend to search online before they make a buying decision.
If you are in a service business where there isn't a set price for services, provide the customer with a written quote outlining what they will receive for the services you are providing and your terms and conditions for the engagement. Have the client sign or turn the quote into a contract or order agreement. This is unnecessary if you provide a service that prices are set and listed, such as hair or nail salons, medical services, or even a business providing oil changes for your car.
If you fall into the category of a service business above that does not provide a service with a price list, you need to provide an invoice from an accounting system before you collect any down payment or final payment from the client. It is the best practice to provide a receipt after they have paid, but at minimum, they should receive an invoice.
Once you have completed the service, follow up with the client afterwards. At this time, you could ask them if they would write a testimonial for your website or review on Google if the work that was performed met the client's expectations. In most cases, you will find they will be more than happy to write a review if they were pleased with the work. In many cases, they may have done this on their own.
With a service-based business, though you might be providing similar services to others, there are more ways to distinguish yourself by having a reputable business and providing quality services. You are the business in many cases and the business should represent what you want to portray to your customers.
If you need help setting up your service-based business, we can help you through business coaching.