From trucks to equipment to insurance, field work is a pricey business to get into. However, technology is opening up opportunities to lower fixed costs in ways that used to be impossible. In one national field work company’s case, it led to 6-figure savings per day.
The magic KPI: first time fix rate
First time fix rate - the measurement of how many jobs you get done in one trip - is probably the most critical KPI in the field service industry. Not only does it signal profitability, but also customer satisfaction. In financial terms, ICwhatUC data found the average truck roll costs $350 when you factor in labor, vehicle maintenance, wear and tear on equipment, etc., so it adds up quickly if you need to do more than one trip.
In a similar vein, customer patience and satisfaction rests on having their problems solved. If you have to keep coming back, you risk destroying satisfaction and your customers’ overall opinion of your business. This in turn limits referral opportunities, further harming your ability to be profitable and grow.
How to improve first time fix rate with visual tools
The most efficient field work companies have a first time fix rate of 88%, according to Aberdeen Research. The bottom quartile is somewhere around 63%. For this example, we’re going to look in the middle - assuming a 75% fix rate (meaning 25% of fixes require a second trip. We’ll assume none require a third trip for this example).
If you have 500 service calls in one day across your business, that actually means you need to do 625 trips (500 calls x 1.25, since 25% of calls require two trips). At $350 per trip, that’s an average cost of $218,750 per day.
Now, let’s insert visual assistance into the equation. With a visual work platform, you can:
- Remotely help a customer fix the problem with live guidance.
- Create a video library of common problems (with solutions) you can send to customers with minor issues or questions that might not require a person onsite.
One ICwhatUC customer implemented this video strategy and was able to solve 62% of customer challenges virtually - meaning they didn’t have to send a truck out at all. They had an average of 500 service calls per day, but only needed to make 238 trips (Only 38% of calls required a truck roll, and keeping the same metric that 25% of the time you send a truck out, it requires two trips).
The cost for 238 truck rolls, covering 500 service calls, is $83,300: a savings of $135,450 per day while still solving the same number of problems.
Eliminate the trip altogether
The trick to saving significant costs in the field work industry is not incremental decreases to fixed costs. Unfortunately, you can only get so far with that strategy. The real win is to think of ways to eliminate the home visit altogether, and that’s where video technology really shines. While we used the client example of 500 trips per day, the reality is even small operations can save thousands of dollars (for example, a smaller operation with 15 daily trips could save almost $2,500 per day). Technology has opened up huge opportunities to eliminate fixed costs without lowering customer satisfaction (or even improving it). Once you’ve tackled that, there are even opportunities to create net-new revenue streams using technology in field work.