Maintenance agreements generate stable monthly income, increase customer retention, and fill slow seasons. Learn how to design, sell, and manage profitable programs.

Preventive Maintenance Agreements: Build Predictable Recurring Revenue

Your revenue looks like a roller coaster:

Summer: $180,000/month (AC season)
Fall: $90,000/month (slow)
Winter: $120,000/month (heating season)
Spring: $70,000/month (slowest)

Cash flow problems. Hiring/firing cycles. Constant stress.

Now imagine:

$45,000/month in predictable maintenance agreement revenue
Plus repair work on top
Smooth, consistent income year-round
Loyal customers who call you first

This is the power of preventive maintenance agreements.

Why Maintenance Agreements Matter

Predictable Revenue

Traditional business model (reactive):

Customer calls when something breaks
One-time transaction
No guarantee they'll call you next time
Revenue unpredictable

Maintenance agreement model (proactive):

Customer pays monthly/annually
Scheduled service visits
Recurring revenue (subscription model)
Predictable cash flow

Example transformation:

Before maintenance agreements:
- 500 customers
- $600,000 annual revenue
- $50,000/month (average, but varies wildly)

After 300 maintenance agreements at $300/year:
- $90,000/year = $7,500/month guaranteed
- Plus repair work from members
- Plus new customer revenue
- Smooths cash flow

Customer Lifetime Value

One-time customer:

Service call: $250
LTV: $250-500 (if they return once)

Maintenance agreement customer:

Annual fee: $300
Average membership: 5 years
Plus repair work: $400/year average
LTV: $3,500 (7× more valuable)

Plus: Maintenance members refer more customers

Competitive Moat

Customers with maintenance agreements:

Less likely to shop around
Call you first when issues arise
Higher tolerance for price
Less sensitive to competitor ads

Retention rate:

Non-members: 30-40% annual retention
Members: 85-95% annual retention

Fill Slow Seasons

Schedule maintenance during off-peak:

HVAC: Schedule AC tune-ups in spring, furnace in fall
Plumbing: Schedule drain cleaning in slow months
Electrical: Inspect panels in off-season

Benefits:

Keep technicians busy year-round
Reduce layoffs/hiring cycles
Improve employee retention
Smooth workflow

Types of Maintenance Agreements

Basic Annual Agreement

What's included:

1-2 preventive maintenance visits per year
Priority scheduling
10-15% discount on repairs
No service call fees

Pricing: $99-199/year

Best for: Price-conscious customers, simple equipment

Example (HVAC Basic):

$149/year includes:
✓ Spring AC tune-up
✓ Fall furnace tune-up
✓ 15% off all repairs
✓ Priority scheduling
✓ No service call fees

Premium Agreement

What's included:

2-4 maintenance visits per year
Priority scheduling (same-day when possible)
20-25% discount on repairs
No service call fees
Extended warranty coverage
Free minor repairs (under $100)

Pricing: $249-399/year

Best for: Value-seeking customers, complex equipment

Example (HVAC Premium):

$329/year includes:
✓ Spring AC tune-up + coil cleaning
✓ Fall furnace tune-up + safety inspection
✓ 2 filter replacements
✓ 25% off all repairs
✓ Priority same-day service
✓ No service call fees ($99 value each)
✓ Free minor repairs (up to $100)
✓ 2-year parts warranty

Commercial Maintenance Contracts

What's included:

Monthly or quarterly service visits
Comprehensive equipment coverage
Detailed inspection reports
Priority emergency service
Dedicated account manager
Custom service schedules

Pricing: $200-2,000+/month (depending on size/complexity)

Best for: Commercial buildings, multi-unit properties, businesses

Equipment-Specific Plans

Single system coverage:

HVAC: Just AC or just furnace
Water heater only
Specific appliance
Individual equipment

Pricing: $79-149/year per system

Best for: Customers with multiple systems, rental properties

Multi-System Bundles

Whole-home coverage:

HVAC + plumbing + electrical
All major systems
One flat rate
Convenience of single provider

Pricing: $499-899/year

Best for: Comprehensive home maintenance, affluent customers

Designing Your Maintenance Agreement

Step 1: Determine Services Included

Typical tune-up checklist (HVAC example):

AC Tune-Up:

Clean condenser coils
Check refrigerant levels
Test capacitor and contactor
Inspect electrical connections
Lubricate moving parts
Check thermostat calibration
Clean drain line
Replace air filter
Test system operation

Time required: 45-60 minutes Cost to deliver: $45-65 in labor + $5-10 materials

Furnace Tune-Up:

Clean burners and heat exchanger
Inspect flue and ventilation
Test safety controls
Check gas pressure
Lubricate blower motor
Replace air filter
Test carbon monoxide levels
Check thermostat
Test system operation

Time required: 60-75 minutes Cost to deliver: $55-75 in labor + $5-10 materials

Step 2: Price for Profitability

Cost-plus pricing:

Total cost to deliver:

AC tune-up: $65
Furnace tune-up: $75
Drive time/overhead: $40
Administration: $20
Total cost: $200

Add profit margin (20-30%):

Cost: $200
Markup: $60 (30%)
Minimum price: $260

Market adjustment:

Competitor pricing: $249-399
Your positioning: Standard
Final price: $299/year

Value-based pricing alternative:

What customer would pay separately:

AC tune-up: $149
Furnace tune-up: $149
2 service calls saved: $198 ($99 each)
Total retail value: $496

Agreement price: $299 (40% savings)

Customer sees value, you maintain margin

Step 3: Add-On Options

Upsell opportunities:

Additional visits: +$50-100 each
Extra filter changes: +$75/year (4 filters)
Surge protector: +$199 one-time
UV light (air quality): +$399 one-time + $50/year service
Upgraded warranty: +$100/year
Smart thermostat: +$299 one-time

Benefits:

Increases average agreement value
Customization for customer needs
Higher profit margins

Selling Maintenance Agreements

Who to Offer To

Best prospects:

✅ New system installations (highest conversion: 60-80%)
✅ Recent repair customers (still top of mind: 30-40%)
✅ 5+ year old equipment (needs maintenance: 25-35%)
✅ Previous customers (seasonal tune-up calls: 20-30%)
✅ New homeowners (don't have established relationships: 25-35%)

When to Offer

Best timing:

During installation:

"Your new system comes with a 10-year warranty, but to keep it valid, you need annual maintenance. Our agreement covers this and saves you money. Only $25/month. Should I add that?"
Conversion rate: 60-80%

After repair:

"I'm glad we got your AC running again. To prevent issues like this, we offer a maintenance agreement that includes annual tune-ups and priority service for $299/year. That's less than this repair cost. Interested?"
Conversion rate: 30-40%

During seasonal tune-up:

"Your system is working well. These annual tune-ups really help prevent breakdowns. Instead of calling each year, our maintenance agreement gives you automatic scheduling plus discounts for just $299. Want me to enroll you?"
Conversion rate: 40-50%

Sales Scripts That Work

Value-focused approach:

"Mr. Johnson, I'd like to tell you about our maintenance agreement. For $25 a month, you get:

Save money: Two tune-ups per year (normally $149 each) = $298 value. You pay only $299 for the whole year, so it basically pays for itself.
Prevent breakdowns: Regular maintenance catches small issues before they become expensive repairs. Most members go years without major problems.
Priority service: When you have an issue, you get priority scheduling. No waiting days or weeks.
Discounts: 20% off all repairs when you do need them.
Peace of mind: Don't worry about remembering to schedule. We call you automatically.

Most of our customers find it saves them hundreds per year. Want to start today?"

Risk-reversal approach:

"Our maintenance agreement is simple: $299 per year, covers two tune-ups plus priority service and discounts. If for any reason you're not happy after the first visit, we'll give you a full refund. You literally can't lose. Should I get you signed up?"

Overcoming Objections

"That's expensive":

"I understand. Let me break it down: If you paid separately, you'd pay $149 for each tune-up, so $298 for the year. Our agreement is $299 total, so just $1 more, but you also get:

Priority service (no service call fees, saving $99 each call)
20% discount on repairs
Automatic scheduling

So you're actually saving hundreds of dollars. Make sense?"

"I'll think about it":

"Absolutely, it's your decision. Let me ask—is it the price, or is there something else I can clarify? (Listen to real objection)

Also, I have to mention: We're currently offering a special where we include a free surge protector ($99 value) if you sign up today. That's $99 in savings on top of the other benefits. Would that make the decision easier?"

"I don't need maintenance":

"I hear that a lot, especially from customers with newer systems. Here's what I've learned in 20 years: Systems that get regular maintenance last 5-7 years longer and have 60% fewer breakdowns.

The agreement costs $299 per year. The average AC replacement is $6,000. If maintenance extends your system's life by even 2 years, you save $12,000. That's a pretty good return on a $299 investment, don't you think?"

Managing Maintenance Agreements

Scheduling System

Automated reminders:

30 days before due: Email reminder
14 days before due: SMS reminder
7 days before due: Phone call
Day of appointment: Confirmation text

Batch scheduling:

Schedule all March agreements in bulk
Assign to technicians by zone
Fill slow days/weeks
Maximize route efficiency

Pro tip: Schedule AC tune-ups in April-May (before peak), furnace tune-ups in September-October (before winter)

Member Benefits Communication

Welcome packet (email or print):

Welcome to [Company] Maintenance Agreement!

Your membership includes:
✓ Annual AC tune-up (spring)
✓ Annual furnace tune-up (fall)
✓ 20% off all repairs
✓ Priority scheduling
✓ No service call fees

We'll automatically call to schedule your tune-ups. You don't need to do anything!

Your membership card is attached. Show it to any technician for your discount.

Questions? Call us at [number]

Thank you for trusting [Company]!

Quarterly newsletters:

Maintenance tips
Seasonal reminders
Special offers for members
Company news

Member portal (if available):

View service history
Schedule appointments
Pay invoices
Manage account

Renewal Process

Renewal timing:

60 days before expiration: Renewal reminder
30 days before: Special renewal offer
14 days before: Final reminder
Day of expiration: Last chance offer

Renewal email template:

Subject: Your [Company] Maintenance Agreement Expires Soon

Hi [Name],

Your maintenance agreement expires on [date]. We'd hate to see you lose your member benefits!

Renew today and lock in:
✓ Your current rate of $299/year (rates increasing to $329 next year)
✓ Bonus: Free air filter delivery (4 filters, $60 value)
✓ Continue priority service and discounts

[Renew Now Button]

Questions? Call us at [number]

Thanks for being a valued member!

Auto-renewal option:

Charge credit card automatically
Email notification 7 days before charge
Option to opt-out
Increases renewal rate to 90%+

Maintenance Agreement Economics

Sample P&L (500 members at $299/year)

Revenue:

Agreement fees: $149,500/year ($12,458/month)
Repair work from members: $100,000/year (average $200 per member)
Total revenue: $249,500/year

Costs:

Labor for tune-ups: $60,000 (500 members × 2 visits × $60 cost)
Materials/supplies: $10,000
Drive time/overhead: $20,000
Administration: $10,000
Total costs: $100,000/year

Profit: $149,500/year (60% gross margin)

Plus intangible benefits:

Higher customer retention
Referrals from satisfied members
Competitive advantage
Smooth cash flow

Growth Trajectory

Year 1 (launch):

Goal: 100 members
Revenue: $29,900
Effort: High (selling, setup)
Profit: Moderate (learning curve)

Year 2:

Goal: 250 members (100 new + 90 renewed)
Revenue: $74,750
Effort: Medium (systematized)
Profit: Good (economies of scale)

Year 3:

Goal: 500 members (250 new + 225 renewed)
Revenue: $149,500
Effort: Medium (mature program)
Profit: Excellent (sustainable)

5-year goal: 1,000+ members, $299,000+ annual recurring revenue

The Bottom Line

Preventive maintenance agreements transform your business from reactive to proactive, from feast-or-famine to predictable revenue.

Benefits:

Recurring monthly revenue (smooths cash flow)
Higher customer lifetime value (7× more)
Better retention (85-95% vs. 30-40%)
Fill slow seasons (scheduled work)
Competitive advantage (customer loyalty)
More profitable (60%+ margins)

Getting started:

Design 2-3 agreement tiers (basic, standard, premium)
Price for profitability (30%+ gross margin)
Train technicians to sell during service calls
Offer during installations and repairs
Market to existing customers
Automate scheduling and renewals
Track and optimize

Target: 20-30% of customers on maintenance agreements within 2-3 years

Start today. Your first 100 members = $30,000/year in predictable revenue.

ServiceSync includes maintenance agreement management with automated scheduling, renewal reminders, member portals, and profitability tracking. Learn more →

Preventive Maintenance Agreements: Build Predictable Recurring Revenue