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How to create a service maintenance contract

Guide to Providing a Maintenance Contract

What is a Service Maintenance Contract?
What are the Different Types of Maintenance Contracts?
How to Create a Planned Maintenance Contract
How to Create a Contract for Unplanned Maintenance
Creating a Maintenance Service Agreement with Joblogic Software

Whether your service business operates in the HVAC, plumbing or electrical industry, you’ll know that client assets can break down at any time. Thus, many companies will look to you for a maintenance contract to ensure their equipment is regularly serviced and maintained.

If you’re looking to access maintenance service agreements, alongside a full library of digital forms, this guide will show you how to get started with Joblogic.

What is a Service Maintenance Contract?

A service maintenance contract is an agreement between a service provider and a client that outlines the tasks, schedule, and frequency of maintenance services. For example, commercial maintenance contracts for HVAC clients may include four check-ups and one filter replacement on their systems per year.

There are many advantages to offering a service and maintenance agreement for your business. The most obvious benefit is that it guarantees regular income, which can help you better predict and manage company cash flow. Moreover, it can also help you build better relationships with your clients by fostering trust and transparency.

What are the Different Types of Maintenance Contracts?

Some clients may only require service when anomalies or problems occur, while others require regular preventive maintenance to avoid costly downtime. As such, there are four types of service maintenance contracts:

Corrective Maintenance

This service and maintenance agreement is activated after a problem has been identified, leading to further action to restore operating conditions. Because equipment downtime is often expensive, many clients are willing to pay a premium for corrective maintenance services.

Although corrective maintenance requires minimal planning and will only resolve a problem as it arises, it cannot identify any larger underlying issues. If not addressed, these smaller issues could cause equipment breakdown, requiring a replacement. Without client assets to maintain, service companies would soon become unprofitable.

Preventive Maintenance

Preventive maintenance is designed to fix minor problems before they escalate into bigger ones. Equipment maintenance is carried out at scheduled intervals with a set of predefined tasks, helping to avoid equipment failures and minimise downtime. For example, a technician sent to service an air conditioner may check and clean the coils, replace the filter, tighten all screws and bolts and check for gas connection leaks.

This maintenance approach is highly beneficial for maintenance companies as it requires a significant upfront investment on the client’s behalf and guarantees steady income.

Risk-based Maintenance

Risk-based maintenance is a proactive approach that uses data analytics to identify potential equipment failures. By analysing past failures, manufacturers can develop models that predict when a particular component is likely to fail. This type of maintenance contract is often used in critical industries, such as healthcare and power generation, where an unexpected breakdown could have catastrophic consequences.

Condition-based Maintenance

This type of maintenance relies on monitoring equipment condition data to identify when maintenance is required. Once performance compromising indicators or anomalies are detected, a technician is deployed to carry out the necessary tasks. This approach is often used in conjunction with other maintenance approaches, as it can be expensive to maintain a constant monitoring infrastructure.

How to Create a Planned Maintenance Contract

Many companies use planned maintenance software to generate contracts more efficiently and quickly when creating this type of contract. However, to ensure your arrangement is water-tight, it should include the below information:

Full name and details of service provider and client

This is self explanatory. Furthermore, the contract should state the purpose of the agreement.

The type of maintenance

The contract should clarify whether it’s a preventive or unscheduled maintenance service.

A disclosed scope of work

This should outline the services performed and any excluded services. For facility maintenance of a public institution, tasks could include plumbing, carpentry, painting and electrical work. Thus, you should describe all jobs explicitly in your facility maintenance service level agreement, so there is no ambiguity if there is a dispute.

A service schedule

This details when you will carry out your services. For preventive maintenance, this will be at specified intervals, while for unscheduled maintenance, it could be when a machine has operated for a set number of hours.

Payment terms

The contract should state how much a client will pay for your work and when payment is due. Furthermore, you’ll want to establish how a client will pay, i.e. hourly, per task, or quarterly lump sum. Additional details like discounts or penalties for late payments should also be included.

Warranties and guarantees

Both the service company and the client should have some form of warranty or guarantee in place. This will protect them if the service company does not meet the agreed-upon standards or the client’s equipment is damaged due to work carried out.

Information regarding legal disputes

Draft a section to include guidelines on how both company and client will resolve any legal disputes. This could involve an arbitration process, saving both parties time and money going to court. You’ll also want to establish any forms of compensation in a legal dispute.

Details on contract termination

All contracts should have a clause that details under what conditions the full service maintenance agreement can be terminated. For example, clauses could be not paying on time, one party breaching the contract, or the service company not meeting the agreed-upon standards.

Digital maintenance contract library

How to Create a Contract for Unplanned Maintenance

Unplanned maintenance is often referred to as reactive maintenance, as it’s only carried out when equipment breaks down. When creating a contract for unplanned maintenance, the process is similar to creating a planned maintenance contract. However, there are a few differences to take into account, such as:

Service Schedule

Because you’re offering unplanned maintenance, you’ll need to be more flexible with the service schedule. This means having to be available on short notice to carry out the emergency work. In your contract, state the maximum response time you can offer.

Scope of Work

Tasks for unplanned maintenance may be more extensive than preventive maintenance, as you may be called in to repair broken down equipment. This will usually require additional resources, such as a team of technicians, extra time, and specialised tools.

Payment terms

Unplanned maintenance is often charged at an hourly rate, as it’s difficult to estimate the amount of work that will be required. For a flat fee payment, ensure to state this in the contract and specify what services are included. If the work performed exceeds the original agreement, you must note how this will be charged.

Creating a Maintenance Service Agreement with Joblogic Software

Joblogic offers a wide array of business tools to streamline your operations, including facilities management software. With Joblogic, you can create a contract for preventive maintenance, unplanned maintenance or a combination of both.

Using our mobile form builder, you can easily create a customised contract and quickly fill out the necessary information, such as your company’s name, address and contact details. You can also select from our various professional templates to save time and boost company image. Once you’ve designed the perfect contract, simply send it to your client for signature.

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