It’s an understatement to say that a food service business relies heavily on refrigeration equipment. That’s why a refrigeration service contract is so beneficial: to keep your equipment in peak shape and prevent breakdowns that disrupt business.
However, when you shop for a refrigeration service contract you quickly realize there’s a wide range of prices as well as different types of contracts. It can be challenging to figure out which one is right for your needs.
That’s why we’ve put together this primer to help you understand the different refrigeration service contract types and what factors into pricing. Armed with this info, you can decide what level of coverage is important for you and be equipped to choose the right contract and the best price.
Refrigeration service contract types
A refrigeration service contract is intended to cover commercial refrigeration maintenance, and sometimes repairs, for all the units in your kitchen. They fall into these categories:
PREVENTATIVE MAINTENANCE: This is the least expensive refrigeration service contract, which covers a number of scheduled maintenance visits each year. The number will vary based on your operation, but most restaurants will need at least quarterly maintenance visits to keep equipment in good condition. During these visits, a technician will thoroughly inspect and clean your equipment, and test the components for proper operation. When needed, worn parts are replaced.
FULL LABOR: In addition to maintenance, a full labor refrigeration service contract covers all the labor needed for repairs. However, you are responsible for parts. This type of contract costs more than one that only covers maintenance.
FULL COVERAGE: This refrigeration service contract is the ultimate insurance policy, because it covers all parts and labor, emergency service and preventative maintenance. This level of coverage costs more, but can save you a lot of money if you need expensive repairs. A full coverage contract also gives you peace of mind and allows you to budget for your refrigeration service expenses with no surprises.
Factors that impact pricing for PREVENTATIVE MAINTENANCE contracts
1. Number of equipment items. If you have a large kitchen or several locations with many refrigeration units, your refrigeration service contract will be more expensive than one that only covers a couple of items.
2. Type of equipment. If you have many large components like walk-in freezers and display cases, your contract may cost more than one covering smaller low-boy or under the counter refrigerators.
3. Available hours for service. In many commercial kitchens, it’s impossible to perform service during normal business hours, because your staff needs access to the units and there’s no space for a technician to work. If service needs to be performed at 4 am, your refrigeration service contract will cost more than one allowing service during daytime hours.
4. Distance. If a smaller refrigeration service company has to travel a long distance to get to you, you’re going to pay for that. On the other hand, a company that’s nearby or is large enough to have trucks in your area every day won’t have to factor in additional travel time. That can keep your price down.
5. Included maintenance tasks. There’s no standard list of maintenance tasks, and some vendors are more thorough than others. Some might just clean and do a quick check before calling it done. Others will check refrigerant levels, electrical connections, clean coils, and replace worn parts before they cause breakdowns. If the included maintenance tasks are not listed in the refrigeration service contract, ask for that list so you can compare apples to apples.
6. Number of maintenance visits. For many restaurants and food service operations, a quarterly service call is sufficient to keep your equipment in good working order and prevent problems. However, the conditions in your kitchen or more complex equipment may require more visits (which means a higher price for your refrigeration service contract). TIP: Don’t be tempted to cut down the visits to reduce the cost. Preventing repairs saves you much more in the end!
Another factor that affects pricing for FULL LABOR & FULL COVERAGE contracts
7. Age and condition of equipment. Just like a life insurance policy costs more depending on your age and your health, a full labor or full coverage refrigeration service contract costs more if your equipment is older and/or in poor condition, and therefore more likely to fail.
Related article :Why Combine a Refrigeration & Commercial HVAC Service Contract?
How to tell if a price is too good to be true
When it comes down to it, the price of a refrigeration service contract for preventive maintenance is derived from the time it takes to do the maintenance tasks, times the company’s hourly labor rate.
If you get a price that seems too good to be true, take out your calculator and do the math to see what you’re really getting:
- Start with the price of the refrigeration service contract and divide that by the company’s hourly rate for service. That’s how many hours of service you’ll be getting.
- Now divide service hours by the number of visits. That’s how much time you’ll get for each service call.
- Divide service visit time by the number of equipment items covered. That tells you how much time the company plans to spend on each equipment item. You might be surprised to find out that this low bidder is planning on spending 4 minutes and 32 seconds on maintaining a piece of equipment.
It’s not too difficult to see if you’ll really get the service you’re paying for.
Why equipment condition is so important to the health of your business
We mentioned that the condition of your refrigeration equipment affects the price of your refrigeration service contract. That’s because well-maintained equipment lasts longer and works more reliably, without breakdowns. So the money you’re spending on preventive maintenance means you’ll spend less to repair it. And the longer life span reduces your total cost of ownership.
When all is said and done, you’re talking about preventing business disruptions, like a broken blast chiller, display case or walk in freezer that can result in disappointed customers and lost profits. Or even worse, poorly performing equipment can cause you to fail your health inspection (read more: 6 Ways You’re Jeopardizing Your Restaurant’s NYC Health Grade).
By now it should be clear that a good refrigeration service contract is not one-size-fits-all. Your contract should be customized to your coverage needs, your equipment and your space. Find out more about how to get what you need with our free guide to Refrigeration Preventive Maintenance Contracts: How to Find the Right One for Your Food Service Operation.
