Service Agreements That Lock in Customers for Life (And Add $100K+ in Recurring Revenue)

Jim Cosmas

Service Business Strategist - Growth Expert | Consulting, Coaching, & Profit Maximization Specialist | Scaling Strategies for Sustainable Success

May 14, 2025

Most plumbers treat service agreements like an afterthought.

❌ They mention them once and never follow up.

❌ They assume customers won’t sign up.

❌ They don’t make them attractive enough to sell.

🚨 That’s a $100K+ mistake.

The highest-profit plumbing businesses don’t just sell service calls—they sell RELATIONSHIPS.

They don’t rely on Google searches for their next job—they’ve already locked customers in.

They have steady, recurring revenue—so they don’t panic when business slows down.

This is Week 2 of the Plumbing Profit Multiplier Series - your blueprint for building a high-profit, high-retention plumbing business.

Week 1: The $100K Profit Leak – Why Most Plumbing Businesses Are Losing Money Without Realizing It ✅ (Done!)

Week 2: Service Agreements That Lock in Customers for Life ✅ (Today!)

📌 Week 3: Pricing for Maximum Profits (Without Scaring Away Customers)

📌 Week 4: The Referral Formula – How to Get More Business Without Paying for Leads

📌 Week 5: Systemizing & Scaling – Building a Plumbing Business That Runs Without You

The Big Myth: "Customers Don't Want Service Agreements"

Plumbers tell me this all the time:

❌ “Customers just don’t care about them.”

❌ “They only call when there’s an emergency.”

❌ “People don’t want to pay for a membership.”

That’s complete nonsense.

Customers DO want service agreements… when they’re positioned the right way.

People DO sign up for memberships all the time—just look at Amazon Prime, Costco, and Netflix.

The smartest plumbing businesses use service agreements to keep customers for life.

Step 1: Build a Service Agreement People Actually WANT

🚨 If your service agreement is just “priority scheduling” and a discount, it’s NOT compelling enough.

Here’s how to structure it so customers feel STUPID for not signing up:

✅ Annual Plumbing Safety Check – Catch leaks, pipe issues, and water heater problems before they get expensive.

✅ VIP Service Perks – Skip the scheduling line and get same-day service.

✅ Exclusive Member Discounts – 15% off ALL repairs and replacements.

✅ Water Heater & Pipe Protection – Extend equipment life with regular checkups.

✅ No Emergency Fees – Nights, weekends, and holidays at NO extra charge.

🔥 The Hook? “This plan actually SAVES you money.”

Most homeowners see plumbing as a “fix it when it breaks” expense. Your job is to show them that NOT having a plan costs them MORE in the long run.

Example Script: "With this plan, you’re protected from surprise plumbing disasters. The small monthly fee is NOTHING compared to what you’d spend on emergency repairs. Would you like me to sign you up today so you never have to worry about your plumbing again?"

Step 2: Train Your Techs to Sell Service Agreements on EVERY Call

Most plumbers make a critical mistake:

❌ They hand the customer a brochure and mumble something about “an optional plan.”

❌ They don’t explain WHY it benefits the customer.

❌ They assume people will “think about it” and call later (they won’t).

How to fix it:

✅ Techs should talk about service agreements before they even start the job.

• “Most of our customers are on our membership plan because it saves them money and prevents emergencies. Let me show you how it works.”

✅ Techs should NEVER ask ‘Do you want to sign up?’

• Instead, ask: “Which plan makes the most sense for your home—the standard or the premium?”

• Customers are more likely to choose an option instead of saying no.

✅ Techs should be PAID to sell agreements.

• Give a $25-$50 bonus per signup.

• The difference in buy-in from your team will be night and day.

🚨 If your techs don’t sell, your customers won’t buy. Period.

Step 3: Automate Renewals (So Customers Stay Locked In)

Most plumbing companies lose money because they don’t have a renewal system. Customers sign up… then forget about it… then don’t renew.

Here’s how to keep them locked in:

✅ Set Up Auto-Renewals – Charge monthly instead of annually so customers don’t think twice about it.

✅ Send a ‘Renewal Reminder’ Email & Text – “Your VIP Plumbing Membership is about to renew! No action needed to continue enjoying your benefits.”

✅ Give a ‘Loyalty Bonus’ for Renewing – “Renew now and get a FREE drain cleaning as a thank-you.”

When service agreements become automatic, your revenue becomes predictable.

Bottom Line: Service Agreements Are Your Fastest Path to Recurring Revenue

Customers WILL sign up—if you make it valuable enough.

Your techs MUST sell it on every job—or you’re missing out.

You MUST set up auto-renewals—so you don’t lose members.

The difference between struggling plumbing companies and the ones scaling fast?

💰 One-time jobs vs. predictable, recurring revenue.

Want to see how to scale without relying on new leads every month?

Take a Free Tour of Our Profit Acceleration Software – Learn How Top Plumbing Businesses Are Scaling Smarter & Faster Click Here to Watch the Training

Next Week: Pricing for Maximum Profits (Without Scaring Away Customers)

🔥 Most plumbers are afraid to raise their prices - so they stay broke while their competitors make a fortune.

Next week, I’ll break down:

✅ How to price for maximum profit (without scaring customers away)

✅ The biggest mistakes plumbers make when setting prices

✅ How to get customers to say YES to premium services, even at higher rates

See you then.

Jim Cosmas