Maximizing Success: Top 7 Appliance Repair KPIs You Need to Track

Appliance repair industry is an ever-growing business in the U.S. The numbers are quite impressive as it generates millions of customers and billions of revenue year over year. To keep up with the pace, businesses need to track and calculate their KPIs to ensure better performance and growth.

Are you a business owner who's struggling to keep up with the competition? Then you're at the right place. In this post, we'll be discussing the top seven appliance repair KPI metrics that you should be tracking to stay ahead of the game. Here are a few:

• Satisfaction rate: This metric is critical to measure as it gives insight into what your customers think of your business. It's essential to keep them happy to retain them and get new ones.
• Technician productivity: How many repairs can your technician handle in a day? This metric helps you to manage your resources and ensure that you're not overloading your team.

As you can see, these two metrics are not enough to scale your business. To learn about the remaining KPIs, keep reading this post, and you'll get everything you need to create a successful appliance repair business.

Satisfaction Rate

Satisfaction rate is an important key performance indicator (KPI) that measures the level of satisfaction of customers or clients with the services or products provided by your appliance repair business.

Definition

Satisfaction rate is defined as the percentage of customers or clients who report being satisfied with the services or products provided by your business. This KPI is crucial because a higher satisfaction rate means that your customers are more likely to return and recommend your appliance repair business to others.

Use Case

Appliance repair businesses can use satisfaction rate to understand customers' overall satisfaction with their services. Additionally, this KPI can provide insight into which specific services or products customers are most satisfied with, allowing the business to focus on improving areas with lower satisfaction rates.

How To Calculate KPI

To calculate satisfaction rate, you need to divide the number of satisfied customers by the total number of customers served and multiply by 100. The formula is:

Calculation Example

Suppose your appliance repair business served 100 customers in a month, and 80 of them reported being satisfied with the services received. The satisfaction rate for that month would be:

KPI Advantages

• Satisfaction rate measures customer loyalty and retention.
• It helps to identify areas for improvement in services and products.
• It can help the business to gain a competitive advantage and improve customer experience.

KPI Disadvantages

• Satisfaction rate does not provide details about why customers are satisfied or dissatisfied with a business.
• Some customers may be biased in providing feedback, leading to inaccurate results.
• Customers may rate the services or the business differently based on the cultural differences and expectations.

KPI Industry Benchmarks for the KPI: 'Satisfaction rate'

Industry benchmarks for the satisfaction rate depend on the industry and the types of services offered by the appliance repair business. For example, customer satisfaction rates for appliance repair can range between 75-90%. A satisfaction rate above the industry average can serve as a competitive advantage and improve revenue over time.

Customer retention rate

As a business owner, every management action you need to take must be taken with an aim to increase customer engagement and accountability. How many of your customers remain loyal to you and stay with your products or services throughout your entire business journey? Considering this aspect of your business can help you determine the inclination of your customers towards your business.

Definition

Customer retention rate measures the percentage of customers who continue buying from your business for a specific period like the previous quarter, year or any other time frame. This KPI measures performance and is essential for tracking how well your business is doing in maintaining its customer database.

Use Case

For an appliance repair business, customer retention rate comes in handy when aiming to maintain and expand the business's customer base. By tracking this KPI closely, you can generate insights to identify customer expectations, evaluate service delivery, pinpoint strengths weaknesses and opportunities, and establish goals to increase customer loyalty and overall profitability.

How to Calculate KPI

• CE = number of customers at the end of a specific period
• CN = number of new customers gained during that period
• CS = number of customers at the start of that period

Calculation Example

For instance, if your appliance repair business had 600 loyal customers as at 1st January and 50 new customers at the end of the first quarter, then you gained 450 new customers by the end of the year and ended the year with 500 customers. A 75% customer retention rate would mean that your business is retaining 75% of its current and existing customers.

KPI Advantages

• Helps to identify customer preferences.
• Benchmarks business operations against industry standards.
• Supports decision-making.

KPI Disadvantages

• May provide false assumptions based on customer behavior patterns.
• May not reflect customer satisfaction.
• The time period for which customer retention rate is calculated may affect business analysis.

KPI Industry Benchmarks

According to the Net Promoter Score Benchmarks Report, the average customer retention rate across all industries is 80%. This means that, on average, businesses lose around 20% of total customers annually, a clear indication that businesses need to work towards improving this retention rate to stay competitive.

Technician Productivity

Definition

Technician productivity measures the average amount of work that a technician completes in a given period of time. This KPI helps to evaluate the efficiency of technicians, assess the productivity of the team, and determine the workload capacity of a team.

Use Case

Tracking technician productivity helps businesses to achieve higher productivity levels and increase profits. By identifying the strengths and weaknesses of individual technicians and the team as a whole, managers can create actionable plans for improvement and optimize work processes. In addition, monitoring technician productivity allows businesses to provide better customer service by ensuring repairs are done efficiently and accurately.

How To Calculate KPI

To calculate technician productivity, divide the total work completed by the number of technicians and the time they worked.

Calculation Example

Suppose a team of four technicians worked for 160 hours and completed a total of 320 work orders. Therefore, the technician productivity for the period is:

The technician productivity for this period is 0.5.

KPI Advantages

• Helps to identify areas for improvement.
• Allows better management of technician workload.
• Assists in the development of performance metrics for individual technicians and the team.
• Improves the efficiency of technicians and team performance.

KPI Disadvantages

• Not suitable for measuring quality of work.
• Doesn't provide an insight into the skills and knowledge of individual technicians.
• Can be influenced by external factors such as materials delivery.
• May cause technicians to focus solely on quantity, neglecting quality and accuracy.

KPI Industry Benchmarks for 'Technician productivity'

According to the appliance repair industry benchmarks, a good technician productivity rate is between 0.6 to 0.8 for a period of one month. However, this will vary depending on the size of the team, the complexity of the repairs, and the level of experience of the technicians.

Average repair time

As a appliance repair business owner, it's important to keep track of key performance indicators (KPIs) to ensure your business is running efficiently. One KPI metric that you should be tracking is average repair time.

Definition

Average repair time measures the average amount of time it takes your business to complete a repair job. This KPI is important because it can help you identify areas where your business may be falling behind, such as in the speed of your repairs. It can also help you identify the areas where your business is excelling.

Use Case

By tracking average repair time KPI, you can identify areas where your business can improve. For example, if you notice that your business takes longer to repair certain types of appliances, you can adjust your scheduling and training to improve efficiency.

How To Calculate KPI

The formula to calculate average repair time KPI is:

Calculation Example

Let's say in a month, your business completed 50 repairs. The total time taken to complete those repairs was 200 hours. To calculate the average repair time:

So, in this example, the average repair time for your business is four hours.

KPI Advantages

• Helps identify areas where your business can improve
• Offers insight into overall efficiency of your business
• Can help you identify your strengths and weaknesses

KPI Disadvantages

• Does not take into account the complexity of repairs
• May not be applicable to all types of repair businesses
• May be influenced by external factors such as parts availability or weather conditions

KPI Industry Benchmarks

According to industry benchmarks, the average repair time for appliance repair businesses should be around four to six hours. However, this number may vary depending on the type of repair.

Profit Margin

Profit margin is a metric used to assess a company's profitability by calculating the percentage of profit generated from its total revenue. It is an important KPI for appliance repair businesses to track their financial health and optimize their pricing strategies.

Definition

Profit margin is the ratio of net income to total revenue, expressed as a percentage.

Use Case

Appliance repair businesses can use profit margin as a key performance indicator to:

• Determine the profitability of individual services
• Evaluate the success of pricing strategies
• Compare the performance of different business divisions or competitors

How To Calculate KPI

To calculate profit margin, use the following formula:

Calculation Example

Suppose an appliance repair business generated $100,000 in revenue and had a net income of $20,000 during a given period. The profit margin would be:

KPI Advantages

Profit margin provides numerous advantages for appliance repair businesses, including:

• Identifying areas for cost reduction and optimization
• Encouraging efficient use of resources and assets
• Enabling effective decision-making

KPI Disadvantages

There are some limitations to using profit margin as a KPI:

• It does not consider the costs of investments or financing, such as interest expenses or taxes
• It can be influenced by one-time events like large expenses or unusual income sources
• Profit margins can vary significantly between industries and businesses

KPI Industry Benchmarks

Benchmarking is comparing one's business processes and performance metrics to industry bests or best practices from other industries. The profit margin benchmark varies across industries. The small appliances repair and maintenance industry's quarterly average profit margin is 4.83%.

Online bookings conversion rate

As a serial entrepreneur who has started and run many businesses, I know that tracking key performance indicators (KPIs) is crucial to success. For appliance repair companies, one essential KPI is online booking conversion rate.

Definition

Online booking conversion rate measures the percentage of visitors to your website who make a booking. This KPI is essential because it helps track the effectiveness of your online booking system and website design.

Use Case

For appliance repair companies, online booking conversion rate is a vital KPI because most customers prefer to book appointments online. By tracking this metric, companies can identify areas of improvement and optimize their websites to increase appointments.

How To Calculate KPI

Calculation Example

KPI Advantages

• Helps track the effectiveness of website design and online booking system.
• Helps identify areas of improvement to increase appointments.
• Allows businesses to optimize their online booking systems to increase online bookings.

KPI Disadvantages

• Does not account for factors such as website traffic sources or user experience.
• May be affected by external factors such as changes in the market or the economy.

KPI Industry Benchmarks

Industry benchmarks vary, but generally, a good online bookings conversion rate is around 20-30%. For appliance repair companies, it's essential to monitor their rate closely and aim for continuous improvement.

Understanding and tracking KPIs such as online bookings conversion rate is crucial for the success of any appliance repair business. By monitoring this metric, companies can optimize their online booking systems and increase appointment bookings, leading to increased revenue and growth.

Marketing ROI

As a serial entrepreneur who has started and run many businesses, I know that keeping track of KPI metrics is critical for business success. In this chapter, we will dive deep into the top seven KPI metrics for appliance repair businesses and discuss how to track and calculate them. We will start with Marketing ROI.

Definition

Marketing ROI is a key performance indicator that measures the effectiveness of a marketing campaign. It is a financial metric that compares the revenue generated by a marketing campaign to the cost of running that campaign. Essentially, it tells you whether or not your marketing efforts are profitable.

Use Case

Marketing ROI is widely used in businesses of all sizes and industries to evaluate the performance of their marketing campaigns. An appliance repair business can use this KPI to determine the success of a marketing campaign by comparing the revenue generated to the cost of the campaign. If the marketing ROI is positive, it means that the campaign has generated more revenue than it cost to run, and the campaign was successful.

How To Calculate KPI

Calculating Marketing ROI is relatively simple:

Calculation Example

Let's say that an appliance repair business runs a marketing campaign that costs $5,000 and generates $8,000 in revenue. To calculate the Marketing ROI, we can use the following formula:

This means that for every dollar the appliance repair business invested in the marketing campaign, it generated $1.60 in revenue.

KPI Advantages

• Marketing ROI is a financial metric that directly measures the profitability of a marketing campaign, making it easy to understand and interpret.
• It allows businesses to evaluate the success of their marketing efforts and make data-driven decisions about future campaigns.
• Marketing ROI helps businesses to identify which marketing channels are most effective and allocate their marketing budget accordingly.

KPI Disadvantages

• Marketing ROI only measures the financial return on investment and does not take into account other intangible benefits, such as brand awareness or customer loyalty.
• It may be challenging to calculate the cost of a marketing campaign accurately, especially if the campaign includes multiple channels or has indirect costs.
• The Marketing ROI metric may not be suitable for businesses that have a longer sales cycle or a complex customer journey, as revenue generated from a campaign may not be immediately attributed to that campaign.

KPI Industry Benchmarks

According to a study by HubSpot, the average Marketing ROI in 2021 for B2B companies is 8.4%, while the average Marketing ROI for B2C companies is 13.2%. However, it's important to note that these benchmarks vary widely between industries and company sizes, and businesses should strive to set their own benchmarks based on their specific situation and goals.

That's it for Marketing ROI! In the next section, we will discuss another crucial KPI for appliance repair businesses: Customer Lifetime Value (CLV).