HVACR BUSINESS APRIL 2023

Direct relationships.

Nearly 130 years of one-on-one communication. No middlemen. That’s what it means to be in the Business of You.

CONTENTS

FEATURES

6 10 Benefits of Selling Residential Maintenance Agreements

Owners will learn the benefits of selling maintenance agreements including loyalty, employee retention, and more.

By Jennifer Shooshanian

10 Does Your Fleet Design Make The Cut?

As an HVACR field service company, it’s important to make sure your fleet design is competitive.

By Heather Langone

12 Seven Service Behaviors to Boost the Bottom Line

Applied with passion and consistency, your business results will improve. Service behavior matters and it is not simply about sales, it is professionalism, customer service, and first impressions.

By Joe Takash

14 Master the “Four Ps” of Retailing to Connect with High-End Homeowners

From the archives, this is one of the best articles on what contractors need to do to market better and get more customers – it’s all about the four P’s.

By Mike Callahan

19 The Compensation Equation

In this first of a three-part series, Crew explains the formula to compensation and why it matters.

By Chris Crew

COLUMN

16 Don't Let Your Key Employees Jump Ship

Prather explains how to keep your best employees to enhance your company’s legacy.

By Keven Prather

20 Are You Afraid to Fire a Customer?

All contractors want to keep customers, but King explains that sometimes, it costs you less to let some customers go.

Ruth King

DEPARTMENTS

5 Publisher's Page

Understanding best practices for leadership and communication

Terry Tanker

17 MRS | The Art of Trade

We offer amazing podcasts and book choices

21 Product Focus

22 20 Questions with Katie Davis

Vice President of Engineering & Technology at Trane Technologies

BADGE OF HONOR.

BEING THE BEST ISN’T JUST A TITLE—IT’S A RESPONSIBILITY. AND SO TO ALL OF OUR DEALERS WHO SHARE OUR UNENDING PURSUIT OF EXCELLENCE: THANK YOU. WE’RE STRONGER TOGETHER BECAUSE WE RUN TOGETHER

THE HVACR MANAGEMENT MAGAZINE

TERRY Tanker

Publisher ttanker@hvacrbusiness.com

HEATHER Langone Managing Editor hlangone@hvacrbusiness.com

MEGAN LaSalla Creative Director mlasalla@hvacrbusiness.com

BRUCE Sprague Circulation Manager bs200264@sbcglobal.net

BARBARA Kerr VP Operations bkerr@hvacrbusiness.com

BY TERRY TANKER

ADVERTISING STAFF ERIC Hagerman

VP Sales Tel 216-409-3246 ehagerman@hvacrbusiness.com

TERRY Tanker

Publisher Tel 440-731-8600 ttanker@hvacrbusiness.com

HVACR Business, founded January 1981, is a monthly national trade magazine serving contractors, mechanical engineers, manufacturers, manufacturer representatives, wholesalers, distributors, trade associations, and others in the heating, ventilating, air conditioning and refrigeration (HVACR) industry primarily in the U.S.

The editorial focus and mission of HVACR Business is to provide business owners and managers with the very best business management concepts available. Critical topics covered include leadership, management, strategy, finance, sales, marketing, training, education, staffing, operations, human resources, legal issues, customer service and more. We are dedicated to helping contractors master these key management skills and provide them with the resources necessary to build strong, profitable companies. Every effort is made to provide accurate information, however, the publisher assumes no responsibility for accuracy of submitted advertising and editorial information.

Copyright©2023 by JFT Properties LLC.

No part of this publication may be reproduced or retransmitted in any form or by any means, including, but not limited to, electronic, mechanical, photocopying, recording or any information storage retrieval system, without the prior written permission of the publisher. Unauthorized copying may subject violators to criminal penalties as well as liabilities for substantial monetary damages up to $100,000 per infringement, costs and attorneys’ fees.

This publication should not be utilized as a substitute for professional advice in specific situations. If legal, medical, accounting, financial, consulting, coaching or other professional advice is required, the services of the appropriate professional should be sought. Neither the authors nor the publisher may be held liable in any way for any interpretation or use of the information in this publication.

The authors will make recommendations for solutions for you to explore. Any recommendation is always based on the authors’ research and experience. The information contained herein is accurate to the best of the publisher’s and authors’ knowledge; however, the publisher and authors can accept no responsibility for the accuracy or completeness of such information or for loss or damage caused by any use thereof.

Subscription Rates: Free and controlled circulation to qualified subscribers. Non-qualified persons may subscribe at the following rates: U.S. and possessions: 1 year $48; 2 years $75; 3 years $96; Canadian and foreign, 1-year $108 U.S. funds only. Single copies $8. Subscriptions are prepaid, and check or money orders only. Subscriber Services: To order a subscription or change your address, write to HVACR Business, 31674 Center Ridge Road, Suite 104, North Ridgeville, OH 44039 or call (440) 731-8600; or visit our Web site at www.hvacrbusiness.com. For questions regarding your subscription, please contact bkerr@ hvacrbusiness.com.

HVACR Business (ISSN 2153-2877) Copyright ©2022 is published monthly by JFT Properties LLC,31674 Center Ridge Road, Suite 104, North Ridgeville, OH 44039, Phone: 440731-8600. Periodicals postage is paid at North Ridgeville, OH and additional mailing offices. (USPS 025-431)

POSTMASTER: Send address changes to HVACR Business, 31674 Center Ridge Road, Suite 104, North Ridgeville, OH 44039.

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(ISSN: 2153-2877)

Companies With The Best Leadership Skills Will Survive & Prosper

Depressions, recessions, or simply weak economies weed out weak and unfit business managers. And if there has ever been a time when weakness in management skills shows up, it’s managing during tough economic times. Over the last three years, I've read hundreds of articles on the topic, and all of them reference one of three reasons for business failures: weak leadership, lack of planning, or poor execution.

Ironically, these maladies are treatable, but for those who won't learn how to lead or won't take the time to review the fundamentals of good business planning and apply them — natural selection will take its course.

In business, as in sports, music, and hundreds of other skill sets, there are naturals — those born with the talent and skills necessary to perform at the highest levels. This certainly is true of leadership. Some just have it; the rest of us have to learn and practice the difficult skills of managing a business, whether large or small. Often small firms are more difficult, there’s less cover.

Attributes of great leaders at great companies are often displayed in excellence at communicating their organizational vision, motivating employees to want to fulfill and participate in that vision, and constantly driving home the vision in individual and group meetings. Salespeople know this axiom; tell them what you’re going to tell them, tell them, and tell them what you told them.

Communicating the vision of what your company is all about should be easy – if you can't do this off the cuff, how can you expect to keep and attract employees, customers, or prospects? Start by writing down your vision. Spend some time working and reworking this statement until it becomes part of who and what you and your company are. Make some copies and paste them up where you are sure to see them throughout the day. You will find it becoming easier to communicate this vision to others as it becomes part of your everyday thinking.

Motivating employees is a matter of taking the time to speak with them regularly to understand their needs, wants, and goals — both for the short and long term — and then giving them opportunities to obtain and achieve these. Find time every week to ask one of your employees: What are we

doing to make your job easier? And what are we doing to make your job more difficult? Listen carefully to their responses. Let them know that you want them to succeed, and to expand and improve their abilities and skills.

Speaking to employees as a group is almost always a learned skill. Face it — you're not Vince Lombardi trying to get alphas motivated to run through the proverbial brick wall. Your task is much more refined and difficult because your "locker room" isn't filled exclusively with alphas and omegas. Your challenge is to motivate the B’s and C’s. Only practice and persistence will give you the skill set necessary to get Vince's results. One way to practice this skill is to hold all-employee weekly meetings to review the week ahead — what goals and targets are set and what is expected from everyone. Work these talks into your weekly routine, and you'll find your speaking skills improving by leaps and bounds.

Where's your game plan? If your business plan is more than 12 months old, you're gambling with your company's future. Without a clear strategy and plan that can be communicated to all of your employees, they are left to guess what needs to be done and in what sequence. Keep it simple and short. And above all, share it with every employee.

Companies win or lose because of good execution or the lack of it. To execute well, your company strategy must be clear, simple, and grounded in economic reality so it supports and drives all actions and initiatives. In addition to this document, employees need to understand the company's plan. If employees have a full understanding of what's expected of them and how it helps to achieve the plan, they will be more motivated, creative, and innovative in finding ways to succeed. All too often, employees do not see how their work and actions relate to the company's success. Make sure you can show them how they fit in and track their performance. Tracking enables you and your employees to make necessary adjustments to improve. In business, the natural selection process isn't much different than in nature. The strong use leadership skills to do whatever is necessary to survive during the drought. When the economy turns, they will be poised for profit growth. u

Attributes of great leaders at great companies are often displayed in excellence at communicating their organizational vision, motivating employees to want to fulfill and participate in that vision, and constantly driving home the vision in individual and group meetings.

10 BENEFITS OF SELLING

RESIDENTIAL MAINTENANCE AGREEMENTS

BY JENNIFER SHOOSHANIAN

Maintenance programs are a crucial element of any well-rounded HVACR service department. An effective HVACR maintenance agreement program provides multiple benefits for contractors and customers and offers business owners a steady, yearround source of revenue.

HVACR maintenance programs can be complex, but successfully managing all the moving parts of such a program, results in increased revenue and profitability, new revenue opportunities, new leads, and enhanced customer satisfaction that more than make up for the investment. Maintenance agreements provide such a wealth of opportunities that are a foundational piece of HVACR business success. For contractors, it is easy to create a pitch – preventing costly repairs, and showing the cost savings of energy efficiency, and longerlasting systems. But to have a successful Maintenance Agreement portfolio, you should know the why from a business standpoint.

Residential maintenance agreements keep technicians active throughout the year, regardless of the seasonal shifts common to the industry. Effective maintenance means scheduled, predictable yearly income instead of seasonal spikes with reactive repair and emergency replacement.

Here are 10 key benefits of maintenance agreement programs that all HVACR business owners should know:

Loyalty

HVACR maintenance agreement programs help contractors build a dedicated base of loyal lifetime customers. Maintenance agreements tend to have high retention rates and offer the opportunity to build trust by taking care of customers year after year. With most agreements, technicians will see customers up to four times annually. This familiarity and quarterly service breeds trust and trust builds loyalty.

Referrals

Lifetime clients generate positive referrals and support your online presence with positive reviews. The better your reviews, the more your business grows.

Year-round revenue

Residential maintenance agreements keep technicians active throughout the year, regardless of the seasonal shifts common to the industry. Effective maintenance means scheduled, predictable yearly income instead of seasonal spikes with reactive repair and emergency replacement. You can run

your business smoothly without having to suffer ebbs and flows that may cause you to dip into savings.

Year-round replacement opportunities

Besides providing preventative maintenance services regularly, maintenance agreements allow contractors to develop a lead pool for future replacement opportunities. Proactive agreement performance reviews will position the contractor to discuss budgeting equipment replacements. As equipment ages, you can talk to clients about future replacements, energy code changes, or refrigerant changes. Continuous maintenance means more opportunities to upsell and present new equipment options. The best part is that now when you make a recommendation it is less of a “sale” and more of a recommendation because you have built a long-term relationship with these clients, engendering trust in the expert services you offer.

Year-round employment

In addition to the year-round revenue which helps you keep your business running well and predictably, maintenance agreement programs provide consistent and steady work year-round for technicians. With a labor shortage and lack of highly trained candidates, the best defense is to retain your top talent. Yearround revenue remedies the slowdowns that can lead to seasonal layoffs.

Accessory sales

Maintenance agreements connect contractors with clients for future business opportunities on replacement items such as UV lights, filters, and humidifier pads. This is an opportunity to expand sales, expand vendor relationships, and add revenue.

Education opportunities

Based on the client relationship enabled by maintenance agreements, technicians have a unique opportunity to educate clients on other services and accessories the company offers. One of the most effective marketing tools in social media is educational content. As a field service business, you have the opportunity to reach companies in

person with educational content and help them see why certain upcoming services or equipment may be the right choice. It’s a very auspicious opportunity if it’s positioned well. Maintenance visits help you do that.

Warranty maintenance

Regular maintenance is a requirement of many manufacturer warranties. Ensuring that equipment is protected enhances the customer experience

and delivers value. Value only helps bolster long, well-established customer relationships.

Reduce emergency breakdowns

One of the main benefits of maintenance agreements for customers is that they can guarantee their equipment gets serviced regularly. Just like we maintain our cars to keep them running, our HVAC systems must be maintained properly to remain efficient, safe, and reliable. Properly servicing HVAC equipment will result in decreased downtime. Keeping up with maintenance will help reduce emergency breakdowns and save money as well. Overall operating costs are reduced when equipment is maintained, and customers will see a reduction in utility costs over time.

Workforce retention

Year-round employment is a must if you want to retain technicians. Research has shown job satisfaction is improved and stress is reduced knowing seasonal swings don’t impact employment.

Based on the client relationship enabled by maintenance agreements, technicians have a unique opportunity to educate clients on other services and accessories the company offers.

continued from page 7

Optimizing the employee experience is critical to retention rates and continuity, during today’s ongoing skilled labor shortage.

UNDERPRICED MAINTENANCE AGREEMENTS

Maintenance programs must be profitable. While maintenance agreement programs are essential, many business owners severely underprice their membership agreements. Many contractors fear that the investment required to create an effective program won’t be recouped, or they will lose participants if they increase maintenance program prices.

When contractors underprice their agreements, they are also conditioning their customers to low prices for other services they offer. When membership programs are sold strictly at a low price or based on all the discounts a client can receive, it devalues the company and

conditions clients to the idea that all future work will be discounted. That’s a big hurdle that many dealers need to overcome.

ENVISIONING A PROFITABLE MAINTENANCE MEMBERSHIP PROGRAM

Understanding how to develop, price, and manage these programs properly is crucial to the company’s long-term success. Many strategies can be employed, but they all have the following features in common:

• A vision to create a profitable and growing maintenance membership program.

• A solid plan to achieve the vision.

• Putting processes and procedures in place to ensure a solid foundation for growth.

• Employing the right strategy and tactics for their company and market.

• Consistent leadership.

• Belief, buy-in, and commitment from the team.

• Clearly communicated goals for the department and individual team members.

• Reporting to measure growth and retention rates.

Maintenance agreements keep teams working and protect profitability. They help lock in customers and create lifelong clients, and many revenue opportunities become available through maintenance agreement programs.

HVAC systems must be properly maintained so they can remain efficient, safe, and reliable. Properly servicing the equipment will decrease downtime, offer better performance and greater efficiency, and overall customer satisfaction supporting your company’s success and growth. u

Jennifer Shooshanian is a Senior Service Coach and Trainer with Business Development Resources (BDR), the premier business training and coaching provider to the home service industry. With over three decades of experience specializing in HVAC Service Operations Management, Jennifer is one of the most knowledgeable and accomplished service performance experts in the United States. Learn more about BDR at www.bdrco.com.

Membership programs must be profitable. While maintenance agreement programs are essential, many business owners severely underprice their memberships.

DOES YOUR FLEET DESIGN MAKE THE CUT?

Good Fleet Design is a Billboard on Wheels

BY HEATHER LANGONE

As an HVACR field service company, it’s important to make sure your fleet design is competitive. Unlike a typical brick-and-mortar business, HVACR owners know that every time one of your service technicians goes to an appointment in a fleet-wrapped company vehicle it’s an opportunity to place an ad in front of potential customers. When the vehicle is stopped at a light, parked at a service call, or seen driving in a neighborhood or on the highway, your fleet design is being seen by potential customers.

Tops in Trucks Tells the True Tale

Our June Tops in Trucks Issue, found at: www.hvacrbusiness.com/news/2022/ jun/01/celebrating-the-15th-yearanniversary-of-fleet-design-excellence-1/ where we choose the best designs annually and just happens to be one of our most popular monthly issues.

One of the reasons for that is that most

Our June Tops in Trucks Issue where we choose the best designs annually and just happens to be one of our most popular monthly issues. One of the reasons for that is that most competitive HVACR business owners understand the importance of fleet as their most important and least expensive marketing tool.

competitive HVACR business owners understand the importance of fleet as their most important and least expensive marketing tool. The most consistent feedback we receive from entrants and overwhelmingly when interviewing the winners is that implementing customized fleet wrap design was and is the best marketing investment they’ve made. Some even report ROIs of 200% or more. However, if your design is not delivering, you may want to consider first, what might be lacking, and second, if it is time for a rebrand. (On the flip side, if you rebranded this year and you think your

design does make the cut, what are you waiting for? Get your entry in at www.hvacrbusiness.com/topsintrucks!)

But, if you are still finding your way, how can you figure out if your design makes the grade? The most obvious way to gauge effectiveness is an uptick in business tied to the vans. Do you consistently get leads from the fleet design? Does your customer service team report back that customers call after seeing the fleet wraps on service vehicles?

Let’s look at some ways to ensure that your current marketing is worth the “wrap” or if it’s time to redesign.

Be A Branding Beast

If you haven’t invested in fleet design or aren’t sure if the current design is paying off, likely, it isn’t. You want your fleet wraps to be powerful sellers. How do you become a fleet design branding beast? Simple – when considering a new design or reviewing your current one ask yourself these key questions:

1. Does the design best represent your brand? What was the why when choosing it?

2. Is it authentic to your story, your team, and your professional tone and company culture?

3. Does it convey your family story or business legacy in some way? Is it tied to the name in a way that might give it a hook?

An example: Last year one of our winners was Gee Heating & Air. The company already had a long legacy in the industry. But when Jacob Gee and his brother Joe took over the

family business, they rebranded and redesigned the fleet with Gee! as part of the logo and, “we deliver the O-M-GEE experience!” Said Jacob, regarding the overall branding. “Yes, we rebranded to the new GEE! logo to help people pronounce our name and capture the brand’s energy. Customers enjoy the infusion of excitement this innovative branding brings to our 33-year-old name.” And says the CFO, “It’s helped us stand out from the competition – the bright colors and messaging. It communicates the brand energy, our difference in quality, speed, and certainly the passion we put into our work.” Gee added that since rebranding with the fleet design in 2021, “the company has seen a 131% return on investment.”

4. Does your fleet look professional?

A well-designed, colorful brand not only gives prospects a professional first impression but from an advertising point of view, is your most costeffective method of attracting new customers in traffic, or in the neighborhood. A well-thought-out design is akin to a good commercial.

Why do you remember a TV ad?

The visuals move you in some way or the hook is catchy. Either way, good advertising is designed to change or modify behavior. A good fleet design does the same thing.

Is It Time to Rebrand

If you think your design may be underwhelming, examine the current creative assets first before you invest in a new strategy. What do you want to say creatively? How does it tie into your story and your company philosophy? Start there. One of our honorable mentions last year was Grasshopper Heating & Cooling. Not only was the design adorable, with a cute grasshopper as their company mascot, but the messaging tied into the owner’s personal and professional mission. When interviewed, the owner, Amanda Triolo, mentioned that grasshoppers only move forward – a concept that is a part of her philosophy

– so she incorporated that concept into both the company slogan and their fleet design.

Get Creative When Creating

Get your employees involved in the design. Have brainstorming sessions with them. You may be surprised how many great ideas come out of these meetings. (And not all of them will be focused on your branding. Other operational improvements will also come to light). You should also consider professional design help once you’ve established a direction. Professionals are trained to help you sharpen the creative messaging. Be authentic – authenticity is gold in the marketing world. On a practical level, pay attention to details. What kind of graphics do you want? Do you want full or partial wraps? You can also be creative in the practical aspects – is the font meant to be creative and fun or strictly professional? Remember you want people to want to look – fun is always a great way to go because typically it’s memorable. But a serious more straightforward design can work as well. That’s why knowing your brand and your why is so important.

Once you decide what is best for your fleet, decide on the budget and convey this to the company you work with for the final design.

My suggestion: Don’t skimp here. Go with the best of three choices and go by referral.

It’s A Van, Not A Book

Once you begin to work with a team, I would suggest a less is more approach. Remember it’s not a TV commercial. It’s a service vehicle and people are viewing it often in in passing. Come up with a great design, that pops, and has recognizable colors, and do not forget to include contact information in the form of a phone number, email address, or website. Customers have to be able to easily find you. Try to be consistent on the website with colors and brand messaging as well. You want recognition to be immediate and obvious when a customer or prospect

goes to your website, after seeing a vehicle from your fleet.

The Hook

If you recall, I mentioned a few past winners from memory. I didn’t do any extra research to suggest these as examples, I simply have many of the top choices committed to memory. It is not because my memory is exceptional. It is because the design, colors, and names were memorable. That is a good fleet design. What is your hook? Ask people if they like it. Do a mini focus group of current customers and employees. And remember, a great name without good colors and great design, isn’t enough. Another option, go through our past Tops In Trucks issues. Look at our past winners at: www.hvacrbusiness.com/ topsintrucks.

Investment vs. ROI

Lastly, we advise you to consider a budget. Fleet wraps should be part of a marketing strategy and are an investment, not an expense. Understand that while there can be a significant upfront cost, (depending on your starting point) if you do your research and create an authentic, well-done design, it will deliver a significant return on the initial investment.

And you don’t have to wrap every vehicle all at once. You can roll out a fleet design over time. See how it does and watch the business grow. By the way, if you already have a good design, it’s not too late. Enter our Tops in Trucks Fleet Design Contest NOW! u

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Heather Langone is the Managing Editor of HVACR Magazine. For comments and feedback, email hlangone@hvacrbusiness.com.

Get your employees involved in the design. Have brainstorming sessions with them. You may be surprised how many great ideas come out of these meetings.

SEVEN SERVICE BEHAVIORS TO BOOST THE BOTTOM LINE

Applied with passion and consistency, your business results will improve.

BY JOE TAKASH

Kathryn walked into a prospective customer’s home with low expectations of winning. Knowing the homeowners were calling around for quotes and she was the third in line, she already assumed the homeowners had made up their minds and were just keeping the appointment to be nice.

When the homeowners greeted her, Kathryn was pleasant but her enthusiasm and confidence level could be aptly described as “low voltage.” The meeting wasn’t terrible, but Kathryn was correct, it wasn’t going to win her company the contract. And it didn’t. Poor Kathryn.

Question: What do the weather and your age have in common?

Answer: You have no control over either.

Question: What are some things you CAN control?

Answer: Every winning service behavior you’re about to read. If you apply them with passion and consistency, your business results will unequivocally improve, and swiftly.

1. Make A Great First Impression

It sounds academic, but start paying attention to how people greet you. Do they smile at you? Do they convey

warmth and enthusiasm? Do they ask questions and show interest in you? ABC in sales means “Always Be Closing.” Bunk! Try ABO: “Always Be Opening.” This is what sets the tone for profitable relationships.

Winning Behaviors: Smile, firm friendly handshake, direct and pleasant eye contact. Motivational pioneer Earl Nightingale said, “Treat every person you meet like he or she is the most important person on earth, because to that person they are.” Right on, Earl.

2. Be A Name-Learning Machine

When I ask seminar participants, “How are you at remembering peoples’ names: A) Fantastic? B) Not-so-hot? C) Embarrassingly bad?” I’m still amazed that more than 90% check off B or C. Fact: Names mean money in business. They create a comfortable atmosphere and make people feel great. Oh, and they are a competitive advantage.

Winning Behaviors: Ask people’s names. When you forget immediately, which we all do, ask again. Then create associations like “Donna from Detroit” or

“Stan the man.” Write names down. Use them while speaking to people. Most of all, practice the name game everywhere. You’ll get in great name shape.

3. Be A Fantastic Listener

Most people are lousy listeners. Sound negative? Sorry, but it’s true. Think of three exceptional listeners and I’ll bet it takes a while. Yet, listening is at the top for qualities that make up great leaders, salespeople, coaches, teachers, and business owners.

Winning Behaviors: Ask openended questions. Practice silence. Do not interrupt or finish people’s sentences. Show nonverbal attentiveness. Paraphrase what others said to show respect and gain accurate understanding. Show emotional support and empathy by trying to understand their perspective. Most of all, be fully engaged. Excellent listening is not just smart business, it says a lot about your character.

4. Create Common Ground

This is when you and others can relate to each other because of a shared interest or experience. When people have things

in common, seeds of trust are planted, friendliness and comfort are accelerated, and all this opens the floodgate for many business opportunities.

Winning Behaviors: Get great at asking questions that lead to sharing information like, “So, John, where are you from originally?” “Did you do anything fun last weekend?”

“Anything exciting you’re looking forward to?” By learning about people beyond the workplace, you discover a whole world that they are passionate about, much of which you can relate to or make a link to. Make these questions habits and you’ll soon be standing tall on common ground.

5. Show Constant Appreciation

The Godfather of psychology, William James, said, “The deepest principle in human nature is the craving to be appreciated.” We all love to be recognized. It feeds our spirit and soul. It motivates us to perform better and shows loyalty to those who pay us kudos.

Winning Behaviors: Send thank you cards every week. Fact: If you don’t send handwritten thank-you notes to customers or clients who patronize your business, you are losing money. Taking time to show gratitude is about class on

Use positive words, choose to look for the best in others, walk with confidence, speak with a genuine passion, and treat people with dignity.

a personal level and it creates a bonding that shows concern on a professional level. Whether you appreciate it via pen, phone, or in person, make it a habit. People like to do business with people they like.

6. Apologize and Admit Fault

Every long-term relationship is challenged by times of conflict and tension. Yet, the identifying marker of how those relationships progress depends on how you respond to that adversity.

Winning Behaviors: Be willing to say, “I’m sorry that I spoke to you like that” or “Team, before we start this meeting, I need to admit fault over how I handled a client situation.” Remember, your best relationships are not built. They are rebuilt.

you think or feel, only by what you say and do.”

Your behaviors are what count most. Play to win. u

7. Be Positively Contagious

Why is it that you can be wide awake, but when you see someone yawn, you yawn? Just writing “yawn” right now makes me want to yawn. You’re probably yawning too, stop it. Human actions are contagious, so why not be positively contagious? This attracts co-workers and builds morale; it connects with clients and builds business.

Winning behaviors: Use positive words, choose to look for the best in others, walk with confidence, speak with a genuine passion, and treat people with dignity. If Kathryn viewed her company as every bit as powerful as her larger competitors and opted to see herself and the benefits she could bring any prospect as breakthrough value, how do you think her in-home visit would have turned out? Realistically, one never knows, but perhaps she should have remembered this advice: “People do not judge you by what

Joe Takash, founder of Victory Consulting and author of “Results through Relationships” is a keynote speaker and business consultant who specializes in management, leadership, and communications. He helps clients like American Express, Prudential, and General Motors build morale, results, and profits through relationships. A syndicated columnist, Takash has been featured in Entrepreneur, Selling Power, Craine’s New York, and MSNBC.com. www.VictoryConsulting.com

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Every long-term relationship is challenged by times of conflict and tension. Yet, the identifying marker of how those relationships progress depends on how you respond to that adversity.

MASTER THE “FOUR Ps” OF RETAILING TO CONNECT WITH HIGH-END HOMEOWNERS

BY MIKE CALLAHAN

Are you a contractor who offers replacement air conditioning, or are you a retailer who markets replacement air conditioning? There’s a big difference, and I have personal experience to illustrate that difference. One recent night, our upstairs cooling system stopped working. Daytime highs were running 94 degrees with a relative humidity of over 75%. (According to the National Weather Service, that’s a “feels like” temperature of 124 degrees F.) We live in South Florida, so we could expect temperatures to remain this high for several weeks. Get the picture? The next morning, I used Google to search for a residential service company to solve our problem. The first company said they could come in three days. The second had no appointments available for a week. The third didn’t even answer the phone. All three of these firms advertise both 24-hour and same-day service on their Web sites. Their ads don’t say “as long as it isn’t too hot, and we’re not too busy,” but apparently, that’s the case. These companies are contractors that offer a

replacement. And because they stayed within that limited role, they lost at least one sale.

Personality Make an Impression

After exhausting my list of contractors, I reluctantly called a large, old-line firm that sports a fancy Web site. I was reluctant because, like everyone else, I thought that anyone who spends all that money on advertising could never have competitive pricing. But since I was having trouble getting anyone, I called Air Hero (a fictitious name). Ultimately, they got my business because they were a retailer, not just a contractor. What does that mean? It means they practiced the

four Ps of retail; Personality, Positioning, Presentation, and Price. Personality: Your company’s personality mirrors your own. If you display a harried, unorganized approach to your work during busy times, so will your team. It’s hot outside! You have more calls than you can handle, tempers are short, and patience is shorter. You have a choice — either jump into the melee and compound the frustration — especially from the customer’s perspective — or display the calm, organized approach that is required to maximize this fantastic opportunity.

In the case of Air Hero, my call was answered quickly and calmly by a friendly voice. “Good morning, Air Hero, this is Becky. How may I assist you today?”

Sounds like a long, drawn-out greeting. Time it. It takes all approximately four seconds to enunciate clearly and precisely. And after only four seconds, the company’s personality is showing. Even though they are busy, at this moment, they are making my problem a priority. I let Becky know I needed help NOW! She assured me that she could help, and even said something like “That’s why we’re here.” Then she asked me a few questions from a script that was on the screen in front of her. After inputting our address, her software alerted her to the fact that our home was over 10 years old. Since we had not done business with them in the past, she wondered about the age of the system. When I answered that it was original, she assigned the call to a welltrained technician who could sell, as well as repair systems.

Becky always called me by name and always exuded confidence. She ended the call by saying that either Steve or Jim would be there between 2 and 4 p.m. TODAY and that she would call when he was on his way. She called at

Are you a contractor who offers replacement air conditioning, or are you a retailer who markets replacement air conditioning? There’s a big difference, and I have personal experience to illustrate that difference.

This is a previously published article from our archive. Unfortunately, our friend and colleague, Mike Callahan passed away in June of 2022. But with summer approaching, we thought this would be a great article.

about 3 O’clock and said Steve was on his way. During one of the hottest days of the summer, how is a company able to provide same-day service? They plan for it. They set aside some of their technician resources to respond to the “right-now” calls on old, stressed systems that are likely to have serious (and expensive) problems and probably need to be replaced. They also know I am much more willing to buy today, if only they can satisfy my immediate need for cooling. Most importantly, they understand the old retail adage, “You can’t sell off of an empty shelf.”

Positioning – How Does Your Company Fit into the Market

So far, my impressions were all positive. I liked Air Hero’s personality.

Positioning: Air Hero created its position in the marketplace. They are retailers of comfort products for the residential, owner-occupied, home market. They provide reliable products and services in a visibly superior fashion on an almost immediate basis. They know that this position requires a big-dollar investment in people, technology, and infrastructure. This requires a significantly higher pricing structure than their nonretail (contractor) brethren. Because of pricing, they know that their customer base is limited to less than half of the residential replacement market. This is the market segment that they target and successfully serve. They understand that these customers will remember the superior treatment long after the price is forgotten.

Presentation – It’s Nine-Tenths of the Truth

Finally, they know how to convey their positioning through their presentation.

Presentation: Steve arrived right on time. He parked his truck at the side of the building and came in through a manned gate. Even though it was near the end of the workday, he was cleanly dressed in a white shirt. His hands were clean, and he displayed a picture ID on a lanyard. After calling me by name, he introduced himself, shook my hand, and politely asked if he could bring his truck around and park inside the gate. He moved his truck to the front of the building. The truck was clean, well-identified, nicely wrapped, and

appeared to be organized. He parked, put caution cones around the truck, and then retrieved his diagnostic tools, which were housed in an attractive closed case. He then donned shoe covers. Once inside, he reiterated his goal — to get us cooling, today. He also stated that, should the system need to be replaced, Air Hero would do the installation the next day.

Steve then outlined his diagnostic procedures and asked about the location of the indoor unit. Next, we went to the elevator to gain access to the heat pumps located on the roof of our four-story building. The elevator doors wouldn’t open because someone changed the entry code. When I told Steve that we would have to hoof it up four flights, he just smiled and offered to go up alone if the units were marked. They weren’t, so we both went up and I identified our units. Steve thanked me and suggested that I return to my relatively cooler home and wait for his report. It was hot up there. I went down. Steve’s presentation — his truck appearance, how he looked, and how he handled himself — went a long way in furthering my positive perception of Air Hero.

Price – It Can Be a Deal-Breaker

Now to the most dreaded P. Price: After about 30 minutes or so, Steve rang the doorbell, again donned his shoe covers, and reported his findings. First, after inspecting both outdoor units, even though I had not requested this, he found that, because of their age (14 years) and proximity to salt water, both units were severely rusted outside and in. He then showed me a series of cell phone pictures. They verified his verbal report. There was a small refrigerant leak in the unit that was not cooling. It was located in the hard copper line at the very top of the compressor. Several hundred dollars would be required to repair it, and there was no guarantee. However, he assured me that he had added refrigerant, and the system was cooling fine for the moment. Steve then outlined my options. He quoted prices on two different system replacements and explained the differences between them. He did not try to sell me the super high-efficiency system. Instead, he asked how long we planned to stay in the house. When I said that it was currently for sale, he recommended the less-expensive option.

Even the lesser option was expensive.

I asked if his pricing was competitive. Rather than becoming defensive, he replied that his pricing was comparable to any other company that provided equal levels of responsiveness and customer service. He knew this was true because no other company provided an equal level of service. He explained that it costs money to have technicians standing by for same-day service. It costs money to get next-day installation during the heat of the summer. It costs money to train team members to be attuned to customer needs. In short, it costs money to provide value. But, value-driven customers are always willing to exchange a few extra dollars for exceptional service and peaceof- of mind. I was certainly willing. I bought.

The following day we had, not one, but two new systems installed and running in our home. As you might expect, the installation was just as thorough, clean and complete as the process that led us there. Want to be a retailer rather

than a contractor? Develop a “cando” personality for your company. Understand whom you serve and position your company to take maximum advantage of every opportunity. Make a presentation that displays your personality and explains your market niche. Finally, Price your offering to cover all the value-added that you provide. Your customer expects it. u

Mike Callahan was the former President of Callahan Roach & Associates Inc.. – now Profit Rhino powered by Callahan Roach. The firm is an industry leader in management and marketing training, consulting, and business sales, mergers, and acquisitions Mike served as president of The Air Conditioning Contractors of America and was an internationally known speaker and writer on business topics. sales@profitrhino.com

PROVIDED BY KEVEN PRATHER, CFBS EXIT PLANNING

Don't Let Your Key Employees Jump Ship

Next-level management teams are the drivers behind building business value. But how can you and your advisors attract and keep next-level management teams? The answer lies within incentive plans.

Employee Incentive Plans

When incentive plans are properly designed and implemented, your business has the potential to grow well after you sell. Well-executed incentive plans can motivate each member of your management team to measurably increase the value of your company.

It is recommended that incentive plans only reward key employees if the business value and/or cash flow increases by a predetermined amount each year. Each incentive plan should be customized to each key employee’s’ role and responsibility and incorporate these four basic elements:

1. Set performance standards that are tied to increasing the value/cash flow of the business necessary to meet your goals.

2. Create specific, attainable standards.

3. Implement substantial incentives and rewards if targets are met.

4. “Handcuff” your key employees, so to speak, to make the incentives so appealing that they are encouraged to stay with the company until goals are achieved.

Many owners create incentive plans or bonuses for their key employees so that key employees cannot obtain the bonus unless they stick around for a certain amount of time. This way, you can increase the chances that once the business is sold your key employees stay and continue to grow your business. This strategy “handcuffs” employees to the business by giving them greater access to compensation benefits the longer they stay. Having these types of plans in place

may also increase the likelihood of a sale because potential buyers love to see trusted employees motivated to stay on and continue to grow the business.

Understanding Employee Motivation

Understand what motivates your employees. It might not only be a bonus of some kind. Think about promotions or other rewards. Are they interested in equity or cash? If your employees are not motivated to achieve their rewards, the incentive plan may become ineffective. The plan also becomes obsolete if the standards don’t increase the value of the business.

Consider these various forms of incentive plan alternatives:

• Non-Qualified Deferred

Compensation plans with incentivebased benefit formulas

• Stock Appreciation Rights plans

Phantom Stock plans

• Cash bonuses (current and deferred) Stock bonus plans

• Stock option plans

• Stock purchase plans with or without minority discounts

Each of these types of plans has its strengths and weaknesses. The lesson here is that there are a variety of types of incentive plans to choose from.

Building the Right Incentive Plan

There are a few basic steps to follow when developing the right incentive plan. First and foremost, back up a step and identify your asset gap. By determining where you are today and where you want to be, in terms of business value, you can start establishing some goals, and then you’ll design an incentive plan that is intended to help you meet those goals on your desired timeline.

Create personal and professional goals. You will want to plan for the success of your business but making plans for your personal life after you leave the business will also help provide clarity to you and your team.

Build and train your management team to be trusted enough to grow the business after you leave. Ensure they have the ability, expertise, and most importantly, willingness, to grow the business at the rate necessary for you to achieve your goals and objectives.

Finally, uncover how you can utilize your management team to help you achieve these goals. Create effective incentive plans to increase business value and motivate your employees. Incentive plans not only benefit key employees, but if designed correctly, they can benefit you as well as the new owner and the business well into the future.

No matter whom you choose as your successor, capable management that stays with the company after an owner’s departure is an important element for a successful future.

We strive to help business owners identify and prioritize their objectives concerning their business, their employees, and their family. If you are ready to talk about your goals for the future and get insights into how you might achieve those goals, we’d be happy to sit down and talk with you. Please feel free to contact us at your convenience. u

Keven P. Prather is a registered representative of and offers securities and investment advisory services through MML Investors Services, LLC. Member SIPC. Call 216-592-7314, send an email to kprather@financialguide. com or visit transitionextadvisors.com.

It is recommended that incentive plans only reward key employees if the business value and/or cash flow increases by a predetermined amount each year.

Management Resource Shelf

Art of the Trade

The art of the trade – in this case the home services trade. We offer a mix of podcasts and books this month that are game-changers. They run the gamut from an invaluable PR strategy to a podcast that is based on field service experts and five questions they should answer to perform better in the field. Please take advantage of our research cultivating this list. We enjoy the work that goes into providing this knowledge for you. Now, all you have to do is read, listen, and learn. So, here it is – our version of “the art of the trade”.

The Duct Tape Marketing Podcast The Most Popular Small Business Marketing Podcast

By John Jantsch

John Jantsch is a marketing consultant, speaker, and best-selling author of Duct Tape Marketing, Duct Tape Selling, The Commitment Engine, The Referral Engine, and SEO for Growth. He is the creator of the Duct Tape Marketing System and Duct Tape Marketing Consulting Network which trains and licenses small business marketing consultants around the world. Since 2005 John Jantsch has interviewed thought leaders, experts, and authors. Subscribe today and hear some of today's most influential marketers and entrepreneurs share their stories and secrets. https://ducttapemarketing.com/about/ duct-tape-marketing-podcast/

Service Business Mastery - Home Service Business Tips and Strategies for the Skilled Trades Service Industry

By Tersh Blissett

Service business mastery is a podcast that helps business owners and managers succeed in business by sharing tips on leadership, marketing, financials, pricing, HR, and much more. If you want to grow a successful and profitable HVAC, plumbing, electrical, or other home service skilled trades business, click here to listen and learn more. And he even interviewed one of HVACR’s regular contributors, Zac Garside. This is a good one. https://podcasts.apple.com/us/ podcast/service-business-masteryhome-service-business-tips/ id1530427467

Five Questions for a Field Service Expert Podcast

By Mobile Reach

Mobile Reach hosts a podcast series called “Five Questions for a Field Service Expert.”

On this podcast, we interview leading field service experts including practitioners, CEOs, analysts, and consultants. We dig into the big questions about field service delivery and management. Every episode we ask a field service expert five questions that can help field service leaders and practitioners do their jobs better.

https://open.spotify.com/show/5jt1vWzPWxKImnNRQ7POeb

Future of Field Service

By Sarah Nicastro

The Future of Field Service podcast welcomes you to hear the firsthand perspective of how business leaders are evolving, innovating, and overcoming. Reaching far beyond the “field service” in our name, we feature guests across industries and geographies to tell of the trials and triumphs they experience as they modernize their businesses. Hosted by Sarah Nicastro, who has 15 years of tenure covering business transformation, technology, and leadership trends. Her authenticity paired with interesting guests and relatable subject matter make for compelling conversations and lightbulb moments.

https://open.spotify.com/ show/3oxT3Q8OIhC2acwsFQsYjX

Next Level Now: PR Secrets to Drive Explosive Growth for Your Home Service Business

By Heather Ripley

Heather Ripley is passionate about helping business owners in the skilled trades embrace the power of public relations to grow. Throughout her career, she’s advised hundreds of contractors on how to effectively boost their visibility and reputation. Now, Heather shares the insight that has made her public relations agency, Ripley PR, one of the most respected and successful firms in the country. NEXT LEVEL NOW is written specifically for professionals in the home service industry. On every page, you’ll find secrets you can use to tell your company’s story, highlight your services, and demonstrate your expertise. Heather is also one of our regular contributors – this is another great choice.

https://www.amazon.com/Next-LevelNow-Explosive-Business-ebook/dp/ B08Z49JZLH/

Get More Customers for Your Home Service Business: Lead Generation Playbook

By Dean Scaduto

For a quick background, I’ve been able to generate more than 70,000 home service leads for both my clients and my own companies. Think roofers, plumbers, HVAC companies, and so forth. Through digital marketing alone, for example, I was able to create a brand new flooring company that broke $1,000,000 in revenue the first year without any flooring experience whatsoever. That means I was able to take away market share from well-established local businesses in the same industry without having any industry reputation or word-ofmouth referrals. This may not be super impressive to some, but I think it’s a great start that highlights the power of digital marketing. So to those people looking to start a new business or maybe expand their existing business into a new vertical, you will get value from this book.

https://www.amazon.com/More-CustomersYour-Service-Business-ebook/dp/ B0BTCB7LNP

Can’t stop a common cold.

When you become a YORK® contractor, your technicians will still be everyday people, but they’ll also have the extraordinary ability to keep customers comfortable. Because our exclusive programs and rebates, expert-led training, and world-class HVAC systems will give them the power to do more.

Become a YORK contractor.

But knows how to bring the heat.

THE COMPENSATION EQUATION

The Complication with Compensation

PART ONE OF A THREE PART SERIES

BY CHRIS CREW

The idea to offer our members a compensation class came to fruition in early 2022 at our company's signature event, Acceleration Days Workshop™. During the event, we opened the floor up for questions, and one of them was regarding compensation. What followed was a lengthy group discussion that made us realize that if we reviewed the compensation structure of ten different members, we'd find ten different methodologies on how they pay. The worst part – none of them would be cost-effective.

The Creation of The Compensation Equation™ Formula

We ran the Compensation Equation as a two-part class held for our Blue Collar Success Group members. Part one was virtual and covered what we'll be going over in this series. Part two consisted of an in-person workshop that helped attending members customize their own company's plan. The formula and materials we use are based on methodologies that Kenny Chapman, Founder of The Blue Collar Success Group, and I used to create The Blue Collar $100M Playbook™. When putting the Playbook together, we sat down and asked, "how do we get our members to a hundred million?" We quickly realized that compensation was a big part of that equation.

In this, the first of a three-part series, you will see how we created The Compensation Equation™ and the subsequent formula and Playbook. And we will explain how you can do the same. In subsequent installments of this article, we will not only dive into the specifics of restructuring compensation plans,

but we will also cover compensation's impact on profits and company culture. First, however, let's examine why most compensation plans don't work.

The Birth of The Compensation Equation™

The more we dug in, the more we discovered that most businesses have either inherited or duplicated a comp plan from someone else in the industry. Even where it seemed to be working, closer examination proved it to be much less advantageous than a custom plan. Case in point — one of our clients had a challenge with their overhead and their direct labor based on their current compensation structure, which was borrowed from a friend in the industry. I asked them to show me the input sheet, and within less than an hour, I saved him a hundred thousand dollars on his compensation plan. He told me that he had no idea how broken his system was. There was a need to dive deeper into this topic, and that's how The Compensation Equation™ workshop was born.

The Complexity of Compensation

We live in a world where people often expect before they deliver, and how we compensate people often affects the results that we get from them. Performance, morale, and retention are a big part of the compensation complexity. For example, you may be paying people based on seniority, which is how the trades have historically operated. The challenge this presents is that it can create

complacency and a sense of entitlement. There are other ways to incentivize longevity and inspire renewed motivation in the process. One way to achieve this is through incentive packages that go beyond the paycheck. For instance, after three years of service with your company, a team member qualifies for more time off and is awarded a gift card to a store or restaurant they frequent. Then after five years, you may decide to pay for a short vacation for that team member and their significant other, along with the paid time off.

In another scenario, you may find that someone who has not been with your company as long as their co-worker may be higher skilled. When this occurs, we point out that there are several ways you can pay based on performance without creating animosity. Sales Program Incentive Funds (Spiffs) and bonuses for achieving certain measurable goals, receiving positive online reviews, etc., put the ball in every team member's court.

If you are not able to create incentives for every position, try creating incentive base pay. Start with what are the most important items a team member can do to contribute to the company's goals and compensate for incentivizing that behavior. For example, your apprentices' main objective is attendance and punctuality. For this, you may choose to pay them a monthly bonus based on these requirements. Remember, all incentives must be completely "objective-driven" so that anyone in that position has the same opportunity.

When comparing team members in separate roles, it’s also important to understand what value they bring to the table.

Here is an example: A technician may generate $400,000 a year in repair work while earning between $80K and $100K a year. A properly trained CSR, however, may only get paid $35,000 despite booking well over $1,000,000 a year via phone work. Do you see the inequity there? The way to compute proper compensation for the CSR is to multiply the number of appointments they booked times your revenue per lead. Run this exercise on your CSRs and see just how much revenue is generated through their phone work. If you find that this position is underpaid, you could be having a challenge retaining or acquiring top talent. Remember, you always get what you pay for.

As previously stated, paying commissions should be easy and uncomplicated. How do you know if your compensation plan falls under these parameters? Simply ask a team member to parrot back to you how their compensation plan works. If they struggle to explain it, there's a good chance they struggle to understand it. Remember that when things are simple, they are also scalable. u

After a journey in the HVAC industry that began when he was sixteen, Chris Crew went on to coach a large electrical company helping franchisees achieve success. Later, he shifted to owning an electrical business, growing it in a four-year span to 60 trucks, five locations, and generating $18 million. Ultimately, he sold his shares to join The Blue Collar Success Group® where he now serves as President. Chris Crew offers extensive knowledge about every facet of in-home services. www.thebluecollarsuccessgroup.com

The more we dug in, the more we discovered that most businesses have either inherited or duplicated a comp plan from someone else in the industry.

BY RUTH KING FINANCE

Are You Afraid to Fire a Customer?

We’re going to go out of business…but we don’t care if we do — this is what three partners said to each other when they went through their entire customer base and decided whom to fire. It was the end of their fiscal year and they were tired of doing business with some customers who were costing them money.

These were the following types of customers:

• Always complaining

• Always wanting a discount

• Late on paying their bills; not paying without collection calls; and/or notoriously 60 to 90 days or more late

• Consistently rude to their employees, and...

• In one case, the building that their employees visited, was unsafe

Once these partners finished making the list, they were ready to fire nearly 10% of their customers.

Value Your Service Enough to Say No

We’ve always been taught to honor the customer, but to grow as a business, you must understand your value. So, while this move made the partners nervous to do, they were resolute. And they fired them with “ruthless compassion.” What does that mean?

It means they met with each customer they were letting go and explained that they were not going to do their maintenance/service/projects in the upcoming year. They also gave these fired customers a list of potential companies as referrals for future work. The result – to their surprise, profits increased the following year. They realized that they weren’t spending time with unprofitable, draining customers, and they could spend time with profitable customers.

Now, at the end of every year, they review their customer list and decide who, if anyone, should be fired. Incidentally,

the list was never as long as it was that first year.

The thing that surprised them was somewhere around the third year, several of the fired customers called to ask if they could come back. The owners agreed with these qualifications. They could return as long as they didn’t complain, paid their bills on time, and treated employees with courtesy. These customers realized how well this company took care of them and could not find another one who performed as well as they did.

Note: One more criterion to the list for firing this kind of customer –the customer is unprofitable. How do you determine whether a customer is unprofitable? Job-cost all their service calls, maintenance work, and replacement/projects.

Here’s an example of a service call that is unprofitable:

Your technician goes to Mrs. Jones’ home. He inspects the home and finds a refrigerant leak. It takes three hours, and

he charges $300. The service department’s gross margin is 50% and the overhead cost per hour is $60. The gross profit for the work your employee performed is $300 X 50% or $150. Your gross profit per hour is $150 divided by three hours or $50 an hour. Your overhead cost per hour is $60. You lost $10 per hour or $30 on that call.

Yes, the technician should have charged more than $300. However, many feel that $300 is a lot of money and won’t pay more. Also, most customers don’t put a value on time. Or, the customer may have complained about the price and was given a discount. Either way, it was a loss. Technicians must charge enough to have profitable service calls.

Use the same process to calculate maintenance profitability.

have 1,000 maintenance plans, that is a $10,000 loss. If your net profit is 8%, then you must generate $125,000 to recover from that loss.

If you find that a customer’s commercial maintenance plan is losing money, then you need to determine what the price needs to be to break even and have a discussion with the customer. You cannot afford to pay customers to perform a valuable service for them.

Replacement/projects can be job costed as well. Where they become unprofitable is usually when crews take longer than estimated to complete the job. Or the customer complains about the proposal price and the price is dropped to accommodate and keep the customer.

One contractor handled this situation very well. He consistently found the same customer always asking for a discount. He discovered that the people in their procurement department got bonused on the discounts they obtained from customers. As a result of this discovery, he always added 10% to the proposal price. So, when the buyer asked for a discount, he gave them the 10% off. He got the price he wanted, and the buyer got the bonus.

If there is no way to make it profitable, that customer is costing you money. Never be afraid to fire unprofitable customers whether for repeated discounted prices, not paying bills, safety, or any other reason. It doesn’t make sense to keep a customer that you pay to do their work. Value your service and you will attract customers who do the same. u

Here is

the formula to calculate maintenance cost vs. profitability:

If you calculate that your company is losing $10 per maintenance plan and you

Ruth King has more than 25 years of experience in the HVACR industry and has worked with contractors, distributors and manufacturers to help grow their companies and become more profitable. Contact Ruth at ruthking@hvacchannel.tv or at 770-729-0258.

If you find that a customer’s commercial maintenance plan is losing money, then you need to determine what the price needs to be to break even and have a discussion with the customer. You cannot afford to pay customers to perform a valuable service for them.

DANFOSS

For commercial refrigeration customers looking for a wireless IoT solution to monitor their assets in the field, Danfoss’ Alsense foodservice platform now offers an affordable, flexible, and secure app-based monitoring solution for temperature tracking, refrigeration operation monitoring, alarms, and HACCP (Hazard Analysis and Critical Control Point) compliance. The app works in conjunction with hardware that acts as an IoT enabler to provide end users with real-time data 24/7/365, including instant alerts, location, and automatic data logging. This helps asset owners ensure food quality, and equipment performance and reduce costs due to food waste.

www.danfoss.com/en-us/

GE APPLIANCES

GE HVAC Evaporator Coils have been tested under extreme climate conditions and subjected to 500 hours of salt spray, so you know they’re going to perform in any region or climate. You can have peace of mind knowing the iconic GE brand carries a legacy of quality, reliability, and innovation. An antimicrobial drain pan helps keep mold, mildew, and other unwanted microbes out of the unit and the air in your home. You can double the standard five-year warranty just by registering your equipment. It’s a simple way to bring peace of mind that your GE unit will keep you comfortable season after season.

www.geappliances.com/ hvac-evaporator-coil

LOCHINVAR

Lochinvar, an industry leader in high efficiency boilers and water heaters, announces the addition of the NOBLE® Floor Mount Fire Tube Combi Boiler to its current residential line of boilers. The NOBLE floor mount combi boiler brings to market a new, easier-to-install option for contractors and homeowners with models ranging from 110,000 to 199,000 Btu/hr. The floor mount provides customers with the proven performance of a Lochinvar NOBLE combi boiler, but now in a new configuration for more installation flexibility. For additional application flexibility, Lochinvar strategically placed the water connection, venting, and gas connection on the top of the unit.

www.Lochinvar.com

ROTOBRUSH

Rotobrush® International LLC, a global market leader in providing indoor air quality solutions, announces the launch of a completely nall-newduct cleaning machine. The next-generation Beast™ DR features next generation smart technology, more vacuum power, and more control while maintaining the same portability and ease of use that is known with the Rotobrush brand. The BrushBeast DR (Drive) is equipped with smart, patent-pending technology. Featuring a direct drive system that has eliminated the need for pulleys. The brushless motor provides significantly higher efficiency, which also reduces costs and necessary labor for maintenance.

www.rotobrush.com

1. Where is the best place to relax in North Carolina?

North Carolina offers some of the most beautiful places to wind down – cool mountain air, warm sandy beaches, and going to the Symphony in Charlotte. My favorite place to relax is Lake Norman.

2. Are you a dog or cat person?

To say that I am a dog person is an understatement! I am the proud owner of 9 Siberian Huskies. I adore all animals, with dogs having a strong hold on the #1 spot.

3. What’s your secret ambition?

I love being an engineer. I am blessed to have been given such fantastic opportunities to have a career doing what I love to do. A fun secret ambition – to be a Master Jedi. I am quite a Star Wars fan.

4. Who is your role model for excellence?

My grandmother – she was a Rosie during World War II, an amazing woman. She taught me to be inquisitive, to think outside the box, and to never stop learning. Her positivity always opened doors to solving problems, and she was quite the technology fan, well into her 80s!

5. Do you have a philosophy that you live by?

Be the very best version of yourself, and you will set the world on fire.

6. What drew you to engineering when you were young?

My father was a welder, and he was a master at repairing and building things around our home. He encouraged me to be curious. I was always fascinated by how he used tools and techniques to bring his ideas to life. With his encouragement, I developed a great interest in all things mechanical.

7. How did you get into the industry?

Before my time at Trane, I studied Engineering at Mercer University. Going through engineering school, it was typical to be one of the only women in the room. In my first-ever position in the industry, I saw elements of myself in the female Vice President I interviewed with, which solidified my decision to pursue a career in a traditionally male-dominated space.

8. You’ve been in leadership roles a long time, what business principles guide you when you manage the team?

As many mentors did for me, I strive to foster the same “yes you can confidence” in aspiring male and female engineers that an Engineering Director with Trane once sparked in me.

9. How do you effectively communicate with your team?

Effective communication happens when a leader can connect with the team in a way that fosters trust.

10. What has been your most recent "the buck stops here moment"?

I don’t know if there was one moment. However, a professor once gave me the advice to stay laser-focused on developing talent. I am focused on inspiring my team and I know it starts and stops with me. I take that responsibility seriously.

11. What is Trane’s climate commitment to clean energy?

We are committed to reducing our customers’ emissions by providing innovative, energy-efficient heating and cooling solutions. We joined the Gigaton Challenge and are well on our way to our goal. Trane surpassed the requirements for the Department of Energy’s Cold Climate Heat Pump Challenge.

12. What advancements will there be in heat pump technology in the next three years?

Trane’s Cold Climate Heat Pumps shall employ a refrigerant that has a GWP of no more than 750, per the requirements of the challenge. While each of the A2L refrigerants has specific competing advantages and disadvantages for cold-climate heat pumps, the right refrigerant is the one that provides the best value for our customers. These heat pumps will utilize R-454B, a Low GWP refrigerant.

13. How has Trane been able to surpass DOE requirements for Residential Cold Climate Heat Pumps?

When tested at the DOE’s lab, the Oak Ridge National Lab Facility, Trane’s CCHP prototype performed in temperatures as low as negative 23 degrees Fahrenheit, surpassing the mandatory negative 20 degrees Fahrenheit DOE requirement. Our prototype pushed the limits of the testing with high performance even as temperatures moved beyond the trial scope. To stop our Trane unit, they had to manually cut the power.

14. When do you expect the results of your newest heat pump trials?

We’ve moved to field testing. The DOE may decide to extend the field trial testing into a second heating season. If this is the case, we will participate in the second field trial and should have the results by the end of 2023.

15. What trends are emerging for high-efficiency heating?

Climate change and urbanization are two macro trends that are influencing the need for high-efficiency heating. These trends influence the industry and consumer perspectives on the reduction in carbon emissions and dependence on fossil fuels.

16. Are the 2030 Sustainability Commitments attainable?

Absolutely! We are well on our way to meeting the Gigaton Challenge, which is reducing our customers’ carbon footprint by 1 gigaton.

17. Trane set a long-term goal of Net-Zero carbon by 2050. Are there big steps to accomplish this or a series of small ones? Our strategy is grounded in our sustainability commitment as a company. This strategy involves long-term goals as well as short-term goals to meet the commitment by 2050.

18. What is the importance of playing the long game in the climate and energy initiative?

As we continue to innovate and deliver energy-efficient solutions through the electrification of heating and heat pump technology, we know that the world’s need for higher-efficiency solutions will continue to grow, and we are ready to meet the demand. We are in this for the long haul.

19. Besides mandates, can you explain the importance of the industry in understanding the need for a collective commitment to cleaner energy?

One industry can change the world. Through initiatives like the Cold Climate Heat Pump Challenge with the Department of Energy, our industry has the unique ability to join as partners and advance technology to provide solutions that reduce emissions for our customers and the world.

20. What advice do you have for contractors managing businesses regarding clean energy? Get on board with the innovation that is happening around higher efficiency equipment and electrification of heating. It’s important to stay informed. We stay in constant communication with our partners to keep them informed and up to speed on the latest government-mandated regulatory changes, tax incentives, or other opportunities to provide homeowners financial relief to upgrade to more efficient products.

Managing Editor, Heather Langone, interviewed Katie Davis, Vice President of Engineering & Technology at Trane Technologies. She spoke of Trane’s strong commitment to energy and sustainability, being a Master Jedi, and her commitment to fostering talent.

Efficiency. Sustainability. Compliance.

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