As a seasoned entrepreneur, I know the importance of tracking key performance indicators (KPIs) in any industry. And when it comes to plumbing, there are seven KPIs that are crucial to monitor for success.

  • Customer satisfaction rate: Ensuring that customers are happy with the plumbing services they receive is paramount to building a successful plumbing business. Tracking this KPI can help you pinpoint areas where improvements may be needed.
  • Number of repeat customers: A high number of repeat customers indicates that your plumbing services are reliable and trustworthy. This KPI can help you assess customer loyalty.
  • Average time to complete plumbing service: Keeping track of the time it takes to complete plumbing services can help you optimize your workflow and minimize costs. This KPI can also help you identify opportunities to improve your efficiency.

These are just a few of the KPIs that are integral to monitoring success in the plumbing industry. By tracking these metrics and making any necessary adjustments, you can maintain a thriving plumbing business that consistently delivers high-quality services.



Customer satisfaction rate

Customer satisfaction rate (CSR) is a key performance indicator that measures how satisfied customers are with the services provided by plumbing companies. A high CSR is essential for long-term business success as it encourages customer loyalty and repeat business. Below is a detailed explanation of the key components of CSR.

Definition

CSR measures the percentage of customers who are satisfied with the services provided by a plumbing company. It is calculated by dividing the number of satisfied customers by the total number of customers, and multiplying by 100. A satisfactory customer is one who rates the service provided as either 'good' or 'excellent'.

Use Case

CSR is an essential metric for plumbing companies as it provides insight into the quality of the services provided. It helps identify areas of improvement and highlights strong points that can be leveraged to differentiate the company from its competitors. Companies with a high CSR tend to have better brand reputation, increased customer loyalty and improved chances of repeat business.

How to Calculate KPI

CSR is calculated using the formula:

CSR % = (Number of Satisfied Customers / Total Number of Customers) x 100

Calculation Example

Suppose a plumbing company has 100 customers, out of which 80 rated the services as good or excellent. The CSR for the company would be:

CSR % = (80 / 100) x 100 = 80%

Therefore, the Customer Satisfaction Rate for the plumbing company is 80%.

KPI Advantages

  • Identifies areas of improvement: A low CSR highlights areas that require improvement, which can then be addressed to enhance overall customer satisfaction.
  • Encourages customer loyalty: A high CSR builds customer loyalty, which results in repeat business and increased brand reputation.
  • Differentiates from competitors: A consistently high CSR differentiates a plumbing company from its competitors and helps build long-term customer relationships.

KPI Disadvantages

  • Subjectivity: CSR depends on customer perception, which can be subjective and influenced by factors beyond the scope of service provided by the plumbing company.
  • Standardization: There is no universal standard for calculating CSR, making it difficult to compare customer satisfaction rates between companies.

KPI Industry Benchmarks

Industry benchmark for CSR varies between 70%-80% in the plumbing industry. It is important to note that benchmarks vary depending on the region, therefore it is important to refer to local industry benchmarks for accuracy.

Tips & Tricks

  • Communicate effectively with customers to gain a better understanding of their needs and expectations.
  • Highlight the company's strengths and unique selling points to customers to differentiate from competitors and boost CSR.
  • Monitor CSR regularly to identify areas that require improvement and capitalize on strong points to build customer loyalty.


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Number of repeat customers

Definition

The Number of repeat customers KPI measures the percentage of customers who make a purchase more than once. It showcases the loyalty of a customer, the quality of products and services, and the customer satisfaction levels.

Use Case

The Number of repeat customers KPI is important for a plumbing business because it helps in improving customer retention, increasing referrals, and enhancing customer loyalty. Repeat customers exhibit a higher level of satisfaction and trust with the business, leading to long-lasting relationships.

How To Calculate KPI

The formula to calculate the Number of repeat customers KPI is:

(Number of repeat customers / Total number of customers) × 100

Calculation Example

Suppose your plumbing business had 100 customers in January, and out of those, 35 made a repeat purchase in February. The Number of repeat customers KPI for January will be:

(35/100) × 100 = 35%

KPI Advantages

  • Enhances customer loyalty and retention
  • Increases referrals and word-of-mouth marketing
  • Identifies satisfied customers and improves customer satisfaction

KPI Disadvantages

  • Does not consider the value of repeat purchases
  • May not apply to businesses that sell one-time products or services
  • Could be impacted by external factors, such as competitor offerings, economic conditions, or seasonality

KPI Industry Benchmarks

The Number of repeat customers KPI benchmark varies according to business type and industry. However, studies show that the average repeat customer rate across all industries is 20-40%.

Tips & Tricks

  • Offer personalized and exceptional customer service to increase customer loyalty and satisfaction
  • Survey customers to collect their feedback and make changes to improve the customer experience
  • Use a customer relationship management system to track customer purchases and interactions to identify potential repeat customers


Average time to complete plumbing service

Definition

Average time to complete plumbing service is a KPI that measures the average time it takes for a plumbing service to be completed. This KPI helps plumbing businesses to assess their efficiency in completing plumbing services and meet customer expectations.

Use Case

The average time to complete plumbing service KPI can help plumbing businesses to:
  • Monitor the efficiency of their plumbing services.
  • Set performance goals for the plumbers.
  • Identify areas for improvement in their plumbing services.

How To Calculate KPI

To calculate the average time to complete plumbing service KPI, use the following formula:
Average time to complete plumbing service = Total time for completing all plumbing services / Total number of plumbing services

Calculation Example

If a plumbing business has completed 100 plumbing services in a month, and the total time taken to complete all services was 500 hours, then the average time to complete plumbing service would be:
Average time to complete plumbing service = 500 / 100 = 5 hours

KPI Advantages

The advantages of measuring the average time to complete plumbing service KPI are:
  • Helps plumbing businesses to identify areas for improvement and increase efficiency.
  • Improves customer satisfaction by meeting the expected service completion time.
  • Helps businesses to set performance goals for their plumbers.

KPI Disadvantages

The disadvantages of measuring the average time to complete plumbing service KPI are:
  • May not provide a comprehensive view of the quality of plumbing services.
  • May not provide meaningful insights into the causes of delays or disruptions in the plumbing services.
  • May not account for external factors that can impact the time to complete plumbing services, such as traffic or inaccessible locations.

KPI Industry Benchmarks

The industry benchmark for the average time to complete plumbing service KPI is between 3 to 5 hours. However, this may vary depending on the complexity of the plumbing service and the location of the business.

Tips & Tricks:

  • Regularly monitor this KPI to identify areas for improvement in your plumbing services.
  • Consider the complexity of the plumbing service and external factors that may impact service completion time.
  • Set realistic performance goals for your plumbers.


Revenue from Emergency Plumbing Services

Definition

Revenue from emergency plumbing services is the total income generated by a plumbing business from its emergency services, which typically involve repairs and installations performed on short notice.

Use Case

Monitoring the revenue from emergency plumbing services is crucial in determining the profitability and sustainability of a plumbing business, as it accounts for a significant portion of the income stream. It also helps in identifying revenue trends and making informed decisions on resource allocation.

How To Calculate KPI

To calculate the revenue from emergency plumbing services, use the following formula:

Revenue from Emergency Plumbing Services = Total Income from Emergency Plumbing Services - Cost of Goods and Services Sold

Calculation Example

If a plumbing business generates $100,000 in total income from emergency plumbing services and incurs $20,000 in cost of goods and services sold, the revenue from emergency plumbing services would be:

Revenue from Emergency Plumbing Services = $100,000 - $20,000 = $80,000

KPI Advantages

  • Provides insights into the profitability of a plumbing business's emergency services.
  • Helps in identifying revenue trends and making informed decisions on resource allocation.

KPI Disadvantages

  • May be affected by external factors such as weather and seasonality.
  • Does not account for non-emergency plumbing services revenue.

KPI Industry Benchmarks

The average revenue from emergency plumbing services for a plumbing business is about $250,000 per year.

Tips and Tricks:

  • Offer promotions to incentivize customers to choose your emergency plumbing services over your competitors.
  • Train your plumbers to handle emergency situations efficiently to reduce costs and increase customer satisfaction.
  • Invest in marketing and advertising strategies to increase the visibility of your emergency plumbing services.


Cost of equipment and supplies per job

As a plumber, it’s crucial to keep an eye on your equipment and supply costs per job. Keeping track of the average costs associated with certain jobs can help you make more informed decisions about pricing and profits. This KPI can also help you identify which jobs are the most profitable and which ones may be costing you money.

Definition

The cost of equipment and supplies per job refers to the average amount of money you spend on materials and equipment for each plumbing job.

Use Case

Keeping track of your equipment and supplies cost can be beneficial not only for pricing and profitability analysis but also for inventory control. By analyzing this KPI, you can determine which supplies and equipment you use the most often, which ones you need to stock up on, and if there are any inefficiencies in your system.

How To Calculate KPI

To calculate the cost of equipment and supplies per job, use the following formula:

Cost of equipment and supplies per job = Total cost of equipment and supplies for a job / Number of jobs

Calculation Example

Let’s say that you completed ten plumbing jobs in a month and spent a total of $500 on equipment and supplies. Your cost of equipment and supplies per job would be:

Cost of equipment and supplies per job = $500 / 10 = $50 per job

KPI Advantages

  • Helps you identify your most profitable jobs
  • Assists in pricing and profitability analysis
  • Provides insight into inventory control
  • Can help you identify inefficiencies in your system

KPI Disadvantages

  • Doesn’t account for other costs (labor, rent, etc.)
  • May not be as useful for larger companies or those with a variety of services

KPI Industry Benchmarks

According to a survey conducted by ServiceTitan, the average cost of materials per job for plumbers is $300-$500. However, keep in mind that this varies widely depending on location, type of service, and other factors.

Tips & Tricks

  • Consider investing in more efficient equipment and supplies to reduce costs over time
  • Determine which services are the most profitable and focus on marketing those services
  • Use software or other tools to track inventory and costs more easily


Number of new customers acquired through referrals

Definition

The number of new customers acquired through referrals is a KPI that measures the effectiveness of a plumbing business' referral program. This KPI refers to the number of customers who have been referred to the business by their existing customers and have subsequently made a purchase or used the business' services.

Use Case

Referrals can be a valuable source of new business for a plumbing company. This KPI can help businesses track the success of their referral program and identify areas for improvement.

How To Calculate KPI

Divide the total number of customers acquired through referrals by the total number of new customers over a given period of time. Multiply by 100 to get a percentage.

Number of new customers acquired through referrals / Total number of new customers x 100

Calculation Example

Suppose a plumbing company acquired 150 new customers in the last quarter, of which 25 were acquired through referrals. The calculation for the number of new customers acquired through referrals is:

25 / 150 x 100 = 16.67%

KPI Advantages

  • Gives insight into the effectiveness of a referral program
  • Can help identify areas for improvement in a referral program
  • Can help businesses increase their customer base and revenue

KPI Disadvantages

  • May not accurately reflect the quality of referrals received
  • May not take into account the indirect impact of referrals on revenue
  • May be affected by external factors outside of the business' control, such as seasonality or market trends

KPI Industry Benchmarks

According to industry benchmarks, the average number of new customers acquired through referrals for plumbing businesses is around 20%. However, this can vary significantly depending on the size and location of the business, as well as the effectiveness of their referral program.

Tips & Tricks

  • Offer incentives for customers who refer others to your business
  • Promote your referral program on social media and your website to reach a wider audience
  • Track the source of each referral to identify which channels are most effective


Customer retention rate

Definition

Customer retention rate is a KPI that measures the percentage of customers who continue to do business with a company over a specific period of time. It is an essential metric that reflects the loyalty and satisfaction of customers towards the brand.

Use Case

Customer retention rate is a critical KPI for plumbing businesses as it determines the level of customer satisfaction and loyalty. A high retention rate indicates that the plumbing services offered by the business meet customer needs and expectations, leading to positive feedback and repeat business. On the other hand, a low retention rate implies that the company needs to improve its services, customer support, and overall customer experience.

How to Calculate KPI

The formula for calculating the customer retention rate is:

((E-N)/S)*100

Where:

  • E: The number of customers at the end of the period (month, quarter, or year).
  • N: The number of new customers added during the period.
  • S: The number of customers at the start of the period.

Calculation Example

Let's assume that at the beginning of the year, a plumbing business had 500 customers. During the year, the company added 200 new customers, and at the end of the year, it had a total of 650 customers. The calculation for customer retention rate would be as follows:

((650-200)/500)*100 = 90%

Therefore, the customer retention rate for the plumbing business is 90%, indicating that 90% of the customers continued to do business with the company throughout the year.

KPI Advantages

  • Helps to measure customer loyalty and satisfaction towards the brand.
  • Provides insights into the effectiveness of customer support, services, and overall customer experience.
  • Helps to identify areas that need improvement to increase customer retention and satisfaction.

KPI Disadvantages

  • May not be suitable for businesses with a high rate of customer acquisition or those focused on one-time services.
  • Does not provide a clear picture of customer behavior, such as why customers leave or their lifetime value to the business.
  • May be affected by external factors, such as market trends, competition, or economic conditions.

KPI Industry Benchmarks

According to industry benchmarks, the average customer retention rate for plumbing businesses ranges between 85% to 90%. However, the benchmark may vary depending on several factors, such as the size of the business, the service area, and the target market.

Tips and Tricks:

  • Offer incentives or rewards to customers who refer new clients to the business.
  • Provide exceptional customer support to address concerns or complaints promptly.
  • Regularly follow up with customers to gather feedback, assess their satisfaction, and identify areas that need improvement.


In conclusion, tracking key performance indicators (KPIs) is crucial to the success of a plumbing business. Among the seven KPIs mentioned, customer satisfaction rate, number of repeat customers, and average time to complete plumbing service are fundamental metrics to monitor on an ongoing basis. Achieving high customer satisfaction rates, generating repeat business, and improving efficiency are all key factors for maintaining a profitable plumbing business. By using these KPIs, plumbing professionals can make data-driven decisions about their operations and improve their overall performance. Therefore, regular tracking and analysis of KPIs should be a vital component of any plumbing entrepreneur's business strategy.

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