The problem with breakdown work
Reactive work is the worst kind of revenue to build a business on. It arrives when it arrives, which means you are either turning customers away or paying technicians to wait. It is priced under pressure, often by the least experienced person in the conversation. And it gives you no claim on the customer next time, because the relationship resets with every call.
Maintenance agreements solve all three at once. The work is scheduled when you choose, the price is agreed when nobody is panicking, and when something does break the customer calls you first because you already hold the history of their equipment.
What a contract should actually specify
The agreements that cause disputes are the vague ones. The agreements that renew are specific about four things: which equipment is covered, how often it is visited, what each visit includes, and what is excluded.
Equipment should be listed as individual units, not as 'the air conditioning at the Lagos office'. When a unit is replaced, the contract should follow the new unit rather than quietly covering something nobody has priced. Visit frequency should follow the duty of the equipment: a kitchen condensing unit running continuously does not deserve the same schedule as a meeting-room split.
- Covered equipment, by unit, with location and nameplate details.
- Visit frequency and what each visit covers, in enough detail that a technician and a customer would describe it the same way.
- What is excluded: refrigerant beyond a stated top-up, parts, out-of-hours attendance, and anything caused by misuse.
- Response time for breakdowns, and whether contract customers get priority. If you promise it, you have to be able to see it.
- Term, price, and what happens at renewal if nothing is said.
Pricing them without losing money
The most common mistake is pricing a contract on the labour of the visits alone, forgetting travel, reporting, the parts you end up absorbing, and the breakdown attendances that contract customers expect to be quicker and cheaper. The second most common is never revisiting the price while the equipment ages and takes longer every year.
Price on the real total time a site consumes over a year, including the attendances you know from experience will happen. Then review it annually against what actually happened, which requires that each visit was recorded against the contract rather than disappearing into general service work.
The operational part most companies get wrong
A contract is a promise to turn up. The failure mode is not the pricing, it is forgetting. A quarterly visit that slips to five months is a renewal you will not get, and the customer will be able to tell you exactly how late you were.
Visits should be generated from the agreement automatically and appear in the schedule like any other job, far enough ahead to be planned rather than squeezed in. The measure worth watching is the share of contract visits completed in their due month. In companies that have never measured it, it is usually far lower than anybody expects.
What renewals actually depend on
Customers renew when they can see what they got. A year of visits that produced no report, no readings and no record of what was replaced feels like a year of paying for nothing, even when the equipment ran perfectly, because there is nothing to point at.
Give them the history: what was done, what was found, what was replaced, and what you recommend before next summer. The strongest renewal conversation is one where you show the customer their own equipment's story and they realise you know it better than they do.