How often have you been stood up on a repair appointment at your cell phone repair shop? And how many times have you repaired the devices and no one comes to pick them up for days?
Quite a few, right?
You know inquiring after appointments is time-taking and often futile. Pushing people to pick up their repaired devices is uncomfortable and offers a bad customer experience. So, you avoid all of it.
And you hope against hope that you’re not stuck in that situation.
But let’s be honest, you’ve got bills to pay! No-show appointments are a waste of time (and sometimes even money!), and delayed pickups prolong the payment cycle.
A lot of customers are uncomfortable with paying upfront payments and do get discouraged by them. However, you can still resolve the issue of no-shows.
You can put an end to your woes by charging initial deposits instead of full upfront payment. This will make the customers comfortable and give you some working capital as well.
Most repair shop owners, however, are apprehensive about charging initial deposits. For one, they fear customers will take their business elsewhere. Secondly, they feel that it gives a bad customer experience. And lastly, they are not confident enough to charge initial deposits.
They will come up with a whole list of reasons why they shouldn’t charge initial deposits.
But here’s why you SHOULD charge deposits to discourage no-shows!
The rate of non-payments goes down.
When customers make a partial payment for a repair, they automatically have stakes involved. They will be more punctual and vigilant to pick their repaired devices up. They will also be more vested in the repair and keep updated on its progress.
You get working capital.
With repairs, you often have to buy a part. It can be a screen, a camera, or a battery. Either way, getting an initial deposit usually covers the cost of the part. That gives you working capital. You do not have to wait for some payment to come in so you can buy a specific part for a repair. This way, you avoid unnecessary delays and increase cash flow.
You get confirmed business for your cell phone repair shop.
When potential customers fix an appointment with you, they often don’t show up. If you charge an initial deposit, you will lower the chances of no-shows and get confirmed business. Someone who has paid even $5 or $10 is vested in showing up for an appointment. So, charging a minimum deposit when fixing appointments is a great idea.
It covers the cost of out-of-stock parts or special orders.
Sometimes, you have to especially order a part for a customer’s repair. You may or may not stock it regularly. Either way, you should charge a small deposit to cover the cost of the part. This saves you from personally investing in a phone part that the client may later not pay for. Moreover, it also keeps your cash flow in order. You do not have to worry about your money stuck in a repair while the customer is taking forever to collect their device.
What to Keep in Mind when Charging Deposits
There are a few factors that you need to consider before charging initial deposits.
New or old clients
A new client is more likely to be unreliable where payments are concerned. So, charging an initial deposit from them makes sense. Simultaneously, if a new client is a referral, they will most likely be reliable. So, they can be exceptions to the initial deposits rule.
You know the payment patterns of most old clients. There may be instances of old customers delaying payments. But they are generally less likely to bolt out of paying you or keep you waiting for long. Besides, you have built a relationship with these customers, so asking them for initial deposits sometimes may sound untrusting.
You should definitely charge an initial deposit to new clients and deal with old clients on a case-to-case basis.
Duration/Value of project
If a project takes a long time, it is smart to charge some initial deposit. The same goes for high-priced repairs. This will keep you above water until the repair is completed and you get the full payment. A quick repair, on the other hand, will be less of a risk.
Contractual projects vs. individual projects
Some repair shops have contracts with government or private organizations. A contract binds the organization to make payments, so asking for initial deposits becomes unnecessary unless there are special part orders. Individuals are not as bound to make timely payments and may falter.
What You Can Do To Ensure Customers Pay Deposits
Here are some steps you can take to make sure your cell phone repair shop customers feel comfortable paying you upfront.
Back your claims
Make sure you have a lot of positive reviews. If you are just starting up, give your customers a voucher or a discount for posting an online review. This will help you get reviews quicker. The technique can also work for repair stores around for a while but does not have any online reviews.
Ideally, email your customers a link to write a review.
Full upfront payment can put some customers off. However, if you offer a discount on paying upfront, people will avail of it. Moreover, you may also charge extra for late pickups. This will also encourage people to pick up their devices on time and pay up.
You can use reinforcing payments to encourage online appointments also. For instance, Metrics Mobile in Winnipeg offers a 10% discount if you book and pay online.
RepairDesk appointments and scheduling module does not offer partial payments. So while it is used to give discounts on full upfront payment, it cannot be used for partial payments when booking online. For this, you can use Acuity Scheduling and create an online appointment module as per your requirements.
Charge at least 50% for special parts
Once you have diagnosed the device, you can discuss the repair with your customer. When they know a special part is required for their device repair, most customers will be willing to make an initial deposit. Do not hesitate and ask them for 50-100% of the special part’s cost. There are a lot of repair shop owners doing it already so do not worry and charge your customers an initial deposit.
Last, of all, be confident in your services and your cell phone repair shop. If you are confident, your customers will be more comfortable trusting their devices with your shop and paying a partial fee.
Keeping the above information in mind, it is okay to charge initial deposits. Remember that customers you lose over partial deposits aren’t the kind of customers you want to do business with.