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Be Careful When Offering Add-On Services

Don’t let extra services distract you from your company’s primary role

For years, building service contractors have heard and read articles about the opportunities in and importance of expanding their service arsenal. Instead of solely performing their primary role—providing traditional cleaning services to offices, schools, and similar facilities—companies have expanded into pressure washing, carpet cleaning, window cleaning, and even some not-so-closely related services such as landscaping and lighting.

The benefit of offering add-on services comes down to one thing: creating additional revenue streams for the company. Because cleaning contractors, like other businesses, can have their ups and downs, additional sources of income can help them “muddle through” the more painful periods.

While some contractors have certainly had success offering and marketing a variety of different add-on services to customers, they can also have serious drawbacks. What can, and often does, happen is that a company can lose its primary focus. It stops paying close attention to its primary service offerings, and in time, quality may decline, the company may not stay on top of industry changes, or it may not take the time to properly train its staff. When this happens, it’s possible that the entire company, along with all its add-on properties, will start having difficulties.

While it does not involve the professional cleaning industry, a good example of this is Yahoo. At one time, Yahoo was the No. 1 search engine in the industry. To maintain its dominance, its leaders started hiring journalists to write for them. It also branched out into such things as Yahoo Finance, Yahoo Sports, Yahoo Movies, and began spending resources on many initiatives such as social media and creating its own media properties, all to stay on top.

In time, visitors began finding the site confusing. According to Robert Simons, the Charles M. Williams Professor of Business Administration at Harvard Business School, “They underinvested in search, and the website became messy and confusing.”

At roughly the same time this was occurring, Google entered the picture. From the start, Google focused entirely on search technologies. It innovated, found ways to help visitors get the specific information they were looking for faster, easier, and more reliably. Google’s innovations were developed solely to serve its primary business, search engine technology. Using this “sharply focused value proposition and business model, Google quickly leapfrogged Yahoo in the competitive marketplace,” Simons says.

This same phenomenon can easily occur to a cleaning contractor, and it’s why we must be careful. However, as previously noted, some contractors now provide add-on services with great success; is there a reason these companies did so well?

Yes. What many of these contractors did, and we certainly see this among very large cleaning companies, is to break up these different add-on services into separate units or divisions. This allows each unit to concentrate on its specific services, the demands of its customers for those services, and supply each unit with the necessary training and equipment required to perform those services.

For most BSCs, adding additional services is a sound idea, but only when the business has the required resources and is large enough to add them as separate units. Until then, remain focused on your primary service offering. This will help you build the foundation necessary to expand into different service areas.


           
Posted On July 28, 2017

Ron Segura

President of Segura Associates

Ron Segura is president of Segura Associates. His company works with all segments of the cleaning industry to help streamline their cleaning and building operations as well as promote sustainability and healthier cleaning strategies. He can be reached at www.seguraassociates.com.

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