How $55,000 in Missed Revenue per Year is a Significant Improvement

Want a really simple way to significantly increase the sales of your existing, appointment based business? Here it is: Call your customers the morning of their scheduled appointment. That’s it. Do that and you can expect a bump in your revenues and profits immediately. For us, we saw a decrease of about 65-70% in the number of missed appointments and an increase of about 10% in sales. This required no extra marketing costs beyond paying an employee for 30 minutes worth of work. Not a bad return on investment.

Let’s run through a quick example using JCD Repair as the case study. We offer people three options for scheduling their iPhone/iPod/iPad repairs. They can call us, email us, or use our online scheduling tool to book an open time. A significant portion of our customers book an appointment 24 hours or more in advance. This means they have to remember, perhaps 3 days later, to come in for their appointment. What we discovered is that about 3 people per day were simply not showing up for their appointment. Our normal scheduling allows for about 16 appointments in a day. On average about 10-12 of those are pre-scheduled. The rest are filled up by walk-in business.

JCD Repair Chicago Calendar
JCD Repair’s Chicago store calendar before reminder calls.

Something should be glaringly obvious right now: About 30% of our scheduled repairs were not showing up! You can see a sample calendar for our Chicago Store on the right. The red appointments are people that never showed up. As you can see, 16 people the week of April 1, 2012 did not show. For us, that equates to about $1,200 in sales per week that we’re losing. That’s $5,000 per month. $60,000 per year! I want to assure you that I’m not cherry picking a specific week. That pattern was very common for all the weeks before April 1. In addition, our Seattle location, which is busier than our Chicago store, was missing about 5 appointments a day. That equates to about $120,000 per year in lost revenue! In short, we were losing a lot of money from these people not showing up.

JCD Repair Chicago Calendar
JCD Repair’s Chicago store calendar after reminder calls.

Our solution to this problem was simple: We began having one of our employees come in an hour before we opened and call every single appointment on our calendar for that day. The results were incredible. You can see from the second calendar on the right that the number of missed appointments went down drastically. In this case, only 3 missed appointments all week.

After having followed this for a couple of months now, we have some pretty good numbers. The data shows that we still have about 5 missed appointments for the week in our Chicago store and about 8-9 in Seattle. Let’s do some fun math.

Before Calling

  • Our Chicago Store saw about 15 missed appointments/week for about $60,000/year in missed revenue.
  • Our Seattle Store saw about 30 missed appointments/week for about $120,000/year in missed revenue.
  • Total missed revenue per year company wide: $180,000.

After Calling

  • Our Chicago Store saw about 5 missed appointments/week for about $20,000/year in missed revenue.
  • Our Seattle Store saw about 8.5 missed appointments/week for about $35,000/year in missed revenue.
  • Total missed revenue per year company wide: $55,000.

As you can see, we still miss out on significant revenue from people not showing up for their scheduled appointments. Unfortunately I don’t think there’s anything that can be done to fix this problem completely (if you think you have a solution, please comment below). However, $55K in missed revenue is $125K less than what we were missing before we started calling people every day.

So if you run a business that allows people to schedule appointments – doctor/dentist, barber, pool cleaning, house cleaner – you might be able to significantly help your business by contacting those people on the day of their appointment to make sure they remember. You’ll also help your customers who presumably need your service and might have just forgotten. Good for you. Good for them. Just an all around win-win solution.

2 thoughts on “How $55,000 in Missed Revenue per Year is a Significant Improvement

  1. Tim Clark says:

    Hey guys, great work on another great blog post. Do you think that requiring a card number to book an appointment would be too much of an inconvenience for your customers? You could charge a no-show/cancellation fee to mitigate losses incurred, but I suppose it might serve as a deterrent for many possible customers.

  2. Hey Tim. I view putting in a credit card as a pretty big hurdle for a lot of people. I think we’d get way fewer appointments scheduled if we did that – people like waiting to give out their credit card until they actually meet us and see their repair finished (and a lot of people pay cash).

    That said, I have considered the idea of offering a 10% discount (or something like that) if people want to pay for their repair at the time of scheduling. They could choose to just do it the way it’s done now, or they could click on a link after the scheduling is done to “Pay in Advance”. It’s something that we might play with in the future to see if it helps.

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