If your bottom line isn’t where you would like it to be, it may be time to change how you run your HVAC business.
Considering that the residential housing market has blown up with relatively low real estate inventory over the last couple of years, the opportunity to make new homeowners your customers is endless.
The commercial sector also has the market as businesses change and move. There is likely room for you to have more customers that require inspecting, repairing, maintaining, rebuilding, replacing, and installing HVAC systems.
The HVAC business is considered an essential service. No matter what season it is, if a natural disaster occurs, or if a global pandemic arises, HVAC businesses are vital to keeping systems working correctly.
How do I start growing my HVAC business?
Whether your business is big or small, keeping the needle moving up should always be your goal. Yet, before you try a new strategy or offer a different service, it is a good idea to evaluate and reflect on what is working and what is not.
Some questions to answer that may help you improve your HVAC business strategy are:
- Can your business keep your team in front of customers all year?
- Are you getting the financial return you deserve from your company?
- Is your cash spread growing or shrinking?
- Is your business surpassing break-even by the third week of every month?
- Are your employees happy enough to count on them for long-term employment?
- Do you offer training and development to retain your sales, installers, and customer service personnel?
- How are your marketing efforts helping to drive your business?
Improve Customer Service
Starting with the incoming service call, ensuring the individual(s) answering the phone or calling a potential customer following an online lead can determine whether you get a shot at that sales opportunity.
Improving your customer service team can help you book more business and increase revenue.
Besides scheduling your appointments, your customer service personnel are, in essence, salespeople. By knowing how to ask specific questions or offer other services, these people can often determine if or how much that customer will bring in revenue for you. When customers have a great experience and feel like whomever they speak with is trustworthy and listens to their needs, they will want an ongoing relationship with your company.
For example, Misty at ABC Heating & Air answers the phone in a cheery voice, constantly introducing herself and asking, “How may I help you?” The first impression is excellent. In addition, simply learning best practices for speaking with customers and calling them back for updates on service calls or parts delays helps build customer loyalty.
Have you ever spoken with many people who end up wasting your time and never giving the right messages to those who need them? We’ve all experienced that with doctors’ offices and other service companies. Endless repeating of your problems to different people answering the phone is not a good customer experience. Get your customer service under control to set your business up for success.
Invest in Technical and Business Training
It is no secret that finding good HVAC technicians is difficult. If your business is big enough, a good salesperson may also not be so easy to find in our competitive landscape. So, what should you do?
Ensure you invest in continuing education by sending your employees to the business and technical training classes. Many classes are now virtual, so no matter where you are, having your employees participate in training can be done off a phone, computer or tablet. Set a schedule to include training as part of their ongoing development. Many manufacturers and distributors host classes year-round. This is a win-win for you, the business owner.
- First, it will keep your employees on the cutting edge of new technology or products in the HVAC industry.
- Second, it will likely motivate them to perform better with their newly gained knowledge.
- Third, it shows them that you want to develop them for a long-term career. The more they know, the more valuable they can be, leading to more profitability. Move your team forward to move your company forward.
Market Your HVAC Business
Are you using traditional radio, TV, direct mail, or truck wraps to market your company? Unfortunately, what used to work, may no longer be the best and only solution. As yellow pages are no longer the way people find a contractor, today, if you don’t have any web presence, you are most likely not positioning your business to grow using lead generation. Sure, word of mouth still works, but online reviews have surpassed relying on recommendations from your customers.
Are you using digital advertising, including a company website or social media? A digital footprint on the web allows small businesses to compete with industry giants.
Depending on your growth plan and strategy, marketing should combine several tools to get your name out in your local community.
Search Engine Marketing (SEM) and Search Engine Optimization (SEO) are both forms of internet marketing that involve promoting your website by increasing its visibility and getting your ads in front of these future customers.
Hiring a consultant who knows how to do this will pay for itself. Unfortunately, much of the success is driven by analytics that most people don’t have the time or knowledge to do effectively.
There are numerous companies that specialize in digital marketing for service-type companies. You can start by talking with your distributor for recommendations on preferred vendors. In addition, many HVAC business training workshops offer in-depth classes on what path to take to meet your business goals. Seek those out first.
Offer Higher-efficiency Products With Financing
Don’t leave money on the table. Contractors who offer customers financing options consistently tend to close more jobs and sell more high-efficiency systems. Talk with your customers and explain that the cheaper option may not be what they want. Whether your customer is looking at a long-term solution to pay for their HVAC system or has sticker shock, contractors can easily navigate the financial challenges of their customer’s budget by breaking down the cost of a more expensive system into feasible monthly payments. Who doesn’t want to invest in a higher-efficiency system for a few dollars more monthly?
When you offer it as if you were selling a home or car, your customer understands that a mortgage or car payment can be digested better in smaller chunks over some time.
HVAC manufacturers and third-party financing partners can help you provide your customers with the best products and services while helping to establish a path to your financial success.
Understanding your customer is an integral part of the HVAC sales process. Your customer may not want to separate from their cash for this emergency. Suppose you can offer customers a way to make an HVAC replacement system more affordable. In that case, a customer may be more likely to accept and appreciate your winning bid.
Pay Attention to The Replacement Cycle
Grow your business by expanding your offering with new parts and other services. Look for something else you can sell.
- Do you offer your customers a quarterly maintenance service?
- Have you discussed indoor air quality (IAQ) products?
- Do you keep a log of all your customer’s equipment ages?
- Older units could spark a conversation with your customer to replace them with something more energy-efficient.
- What about helping your customers with Smart Home products to control their indoor comfort system?
Stay connected to your customers and show them how their devices can alert you if a problem arises. Depending on how sophisticated customers’ needs may be, there are many great solutions.
You need to know that each time you set foot in a customer’s home or business, you have a better chance of finding potential problems or, at minimum, being paid for a service call fee while getting a boost in customer satisfaction resulting in customer loyalty.
Growth From New and Existing Markets
Another way to grow is to expand geographically. Increase your service territory with satellite operations in nearby towns or suburbs.
- Has a new community been built?
- Has the population density increased in local areas that you could service?
- What about HVAC companies closing in a place you service?
Many company owners are retiring, leaving a hole in a market you may want to enter. Know your competition and be ready to pick up the slack of business left behind.
Industry Trends and Insights in the HVAC Sector
Introduction to Current Trends
The HVAC industry, like many others, is undergoing significant changes driven by technological advancements, environmental concerns, and evolving customer expectations. Staying abreast of these trends is not just beneficial; it’s essential for any HVAC business looking to thrive in today’s competitive market.
One of the most notable trends is the rapid integration of smart technology into HVAC systems. Smart thermostats, sensors, and IoT (Internet of Things) enabled devices are revolutionizing how HVAC systems are monitored, controlled, and maintained. These technologies not only improve energy efficiency but also offer unprecedented convenience for users. For HVAC businesses, this means an opportunity to offer new, value-added services such as remote diagnostics and system optimization.
Shift Towards Eco-Friendly Solutions
There’s a growing consumer demand for eco-friendly and sustainable HVAC solutions. This shift is partly driven by increased environmental awareness and regulatory changes aimed at reducing carbon emissions. Modern HVAC systems are now being designed to be more energy-efficient, utilizing renewable energy sources like solar power. Businesses in the HVAC sector need to adapt by offering green solutions and staying informed about environmental regulations.
Consumer Preferences and Expectations
Today’s consumers are more informed and have higher expectations. They seek quick, efficient, and reliable services. There’s a growing preference for customized solutions tailored to individual needs and spaces. HVAC businesses must focus on customer-centric strategies, offering personalized services and maintaining high standards of customer service.
Impact of Global Events
Recent global events, such as the COVID-19 pandemic, have also impacted the HVAC industry. There has been an increased focus on improving indoor air quality to ensure health and safety. HVAC companies are now more frequently tasked with installing advanced filtration and air purification systems.
The Role of Data and Analytics
Data analytics is playing an increasingly important role in the HVAC industry. By leveraging data, businesses can gain insights into system performance, predict maintenance needs, and optimize energy usage. This not only helps in providing better service to customers but also in reducing operational costs.
Jobs, Not Leads
Look for service companies that can put your technicians to work when your company isn’t busy. Some companies service large, national property owners by providing HVAC and other maintenance services for single and multi-family homes or commercial properties. They need skilled contractors they can depend on. And you choose which jobs you wish to accept without bidding or negotiating with the customer. Your technicians consistently have work, so you aren’t paying anyone to sit around and wait for the next service call.