HVACR Business March 2018 by HVACR Business

Everybody Wants Control(s) By Pete Grasso 5

Try a New Pricing Level, Improve Your Bottom Line By Ruth King 7

Master SEO and Lead Generation By Michael Haines 14

Create Your Message and Grow Your Brand By Ryan Holden 16

A Safe Workplace Starts with You By Bob McEwan 17

MARCH 2018 / VOL.13 / NO.3

THE GENIUS OF LEADERSHIP

Page 9

Change the way you think, set a direction and then build a team to achieve the end game

ALSO INSIDE » Featured Entrepreneur: Jaime DiDomenico, president of Cool Today..............6 Product Focus: Residential Thermostats; Commercial VRF Systems....18

Business Insights...........................................................20 20 Questions with Carlton Harwood VP for Ferguson’s HVAC Business Group.........................22

THE COUNTDOWN TO AHR 2018 IS OVER, BUT…

WE’RE JUST

Limitless Vision | Innovative Technology | Unparalleled Commitment AHR 2018 attendees got a chance to see our latest innovations and experience the LG difference. Look out for more exciting advancements coming from LG Air Conditioning Technologies in 2018! Learn more at lghvac.com.

CONTENTS

MARCH 2018 / VOL.13 / NO.3

F E AT U R E S

9 14

The Genius of Leadership Change the way you think, set a direction and then build a team of personnel to achieve the end game. By Gary Elekes

Your marketing must include a comprehensive strategy to engage with and obtain new customers online. By Michael Haines

Try a New Pricing Level, Improve Your Bottom Line Add your overhead cost per hour and your direct cost per hour. This is the absolute minimum price you must charge your customers. By Ruth King

Create Your Message and Grown Your Brand

Coming up with a brand message is a smart strategy, whether your company is new or it’s been around for years. By Ryan Holden

Master SEO and Lead Generation

C O LU M N S

D E PA R T M E N T S

A Safe Workplace Starts with You Sexual harassment, workplace violence and hostile work environments are not acceptable. By Bob McEwan

M A R K E T WAT C H Stock Index: For the latest HVACR Business Stock Index and to read this month’s analysis, visit hvacrbusiness.com/stock-index.

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Editor’s Page This year’s AHR Expo featured a multitude of technology, especially in the Data, Automation and Controls segments. Pete Grasso

Featured Entrepreneur

Product Focus

Business Insights

20 Questions with Carlton Harwood

Jaime DiDomenico, president of Cool Today in Sarasota, Fla.

Residential Thermostats; Commercial VRF Systems

Franchising

Vice president for Ferguson’s HVAC Business Group

Paper is dead.

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Scan the QR code with a compatible app on your mobile device,or visit www3.buildingreports.com/ HVACRBusiness2017 to see the future of HVACR service delivery and documentation.

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EDITOR’S NOTEBOOK

BY PETE GRASSO THE HVACR MANAGEMENT MAGAZINE TERRY Tanker Publisher ttanker@hvacrbusiness.com PETE Grasso Editor pgrasso@hvacrbusiness.com JIM McDermott Editorial Advisor jmcdermott@hvacrbusiness.com MEGAN LaSalla Art Director mlasalla@hvacrbusiness.com BRUCE Sprague Circulation Manager bs200264@sbcglobal.net BARBARA Kerr Executive Assistant bkerr@hvacrbusiness.com

ADVERTISING STAFF EAST COAST/SOUTHEAST JIM Clifford Regional Sales Manager Tel 201-362-5561 Fax 201-334-9186 jclifford@hvacrbusiness.com MIDWEST ERIC Hagerman Regional Sales Manager Tel 440-471-7810 Fax 440-471-7943 ehagerman@hvacrbusiness.com WEST COAST TERRY Tanker Publisher Tel 440-471-7810 Fax 440-471-7943 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 refrigerating (HVACR) industry primarily in the USA. 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©2018 by JFT Properties LLC. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, or by recording, or by any information storage or retrieval system, without written permission from the publisher. 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, 24651 Center Ridge Road, Suite 425, Westlake, Ohio, 44145 or call (440) 471-7810; or visit our Web site at www.hvacrbusiness.com. For questions regarding your subscription, please contact bkerr@hvacrbusiness.com. HVACR Business (ISSN 2153-2877) Published monthly by JFT Properties LLC., 24651 Center Ridge Road, Suite 425, Westlake, Ohio, 44145. POSTMASTER: Send address changes to HVACR Business, 24651 Center Ridge Road, Suite 425, Westlake, Ohio, 44145. Postage paid at Cleveland, OH and additional mailing offices. (USPS 025-431)

24651 Center Ridge Road, Suite 425 Westlake, OH 44145 Tel: (440) 471-7810 Fax: (440) 471-7943 Web site: www.hvacrbusiness.com (ISSN: 2153-2877)

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Everybody Wants Control(s)

always enjoy walking around the AHR Expo (I covered more than 15 miles over the course of two days). And it’s always great to see old friends and meet new ones. But most of all, I appreciate the opportunity to view all the latest technologies the industry has to offer. I’ve noticed throughout the years that each show seems to take on a theme. I remember when 13 SEER was all the rage back in 2006, and of course the big North American push into the ductless market. The last couple of years, it’s been all about education (which continues to be a major initiative by most manufacturers). If I had to pick a theme for this year’s show, it would undoubtedly be Data, Automation and Controls — in both the commercial and residential markets. Here are just a handful of interesting controls-related initiatives I saw at this year’s AHR Expo.

Daikin

Honeywell Honeywell has introduced a new D6 Pro Wi-Fi Ductless Controller, a simple and intuitive replacement for handheld ductless remote controls. The clear and concise menus offer easy-to-read visualization and give your customer access to advanced features such as flexible scheduling, auto-change over and the ability to group D6 controllers into systems if they have a multi-zone ductless installation. “We’ve designed this product to help our contractors provide more value to their existing accounts and to expand the solutions they can offer new accounts,” said AJ Smith, vice president and general manager, Honeywell Home and Building Technologies.

If I had to pick a theme for this year’s AHR Expo, it would undoubtedly be Data, Automation and Controls.

As I mentioned a few months ago, I was lucky enough to get a preview of Daikin’s Intelligent Equipment, which connects directly to 150 data points on rooftop units and 350 data points on air-cooled chillers to monitor energy consumption at the equipment level for deeper, more accurate performance measurement. “Organizations need the right insights and tools to ensure those inside the building are positively contributing to an organization’s strategic goals and outcomes,” said Mike Schwartz, CEO of Daikin Applied Americas. On the residential side of Daikin, new digitally programmable thermostats, such as a ComfortNet Thermostat, feature both comfort and efficiency-enhancing functionality with their smart technology and remote access.

Emerson The Sensi Multiple Thermostat Manager is Emerson’s latest innovation to leverage Internet of Things (IoT) technology to help ensure comfort and energy efficiency. “Customers were sharing that the Sensi thermostat made it easy to remotely control thermostats in buildings they manage, but that being able to change multiple thermostats in one process would help them do their jobs more efficiently,” said Bob Sharp, executive president of Emerson Commercial and Residential Solutions. Through the Sensi Multiple Thermostat Manager, facility managers are able to experience significant savings — both in energy conservation and manpower.

Johnson Controls

Johnson Controls introduced Metasys Enterprise Management, a comprehensive, analytical, cloudbased optimization platform that proactively analyzes building energy and equipment data across an enterprise to identify issues, faults and opportunities for improved performance and operational savings. “Metasys Enterprise Management helps customers close the loop by providing a single platform solution that identifies a fault, suggests the appropriate corrective action, lets users create a work order and then track progress toward the solution,” said Sudhi Sinha, vice president of Data-Enabled Business, Johnson Controls. Metasys Enterprise Management is provided and activated through cloud-based licenses with a variety of subscription options, ensuring customers can easily stay current with updates and enhancements.

LG Electronics For commercial applications, LG’s the suite of advanced controls is comprised of the LG MultiSITE Remote Controller, Communications Manager and VM3 building management solution. “LG is ushering in a new era of connectivity and redefining the industry standard,” said Kevin McNamara, senior vice president, Air Conditioning Technologies, LG Electronics USA. For light commercial and residential controls, 13 more models of LG’s indoor units will now be Wi-Fi enabled and compatible with the LG SmartThinQ app, granting homeowners the convenience of controlling their air conditioning on-the-go alongside their other LG devices for a truly connected home. u HVACR BUSINESS MARCH 2018

Featured

ENTREPRENEUR

Risk is Worth the Reward BY PETE GRASSO

orn in Brooklyn, N.Y. and raised on Long Island, Jaime DiDomenico moved to Florida in 1981 looking for work after a notso-successful stint at Hofstra University. He took a position as a warehouse clerk at Encore Service Systems (now called Service America) in Boca Raton. “Encore serviced homes in South Florida,” he says. “That’s where I learned about parts and purchasing of HVACR, plumbing and appliance parts.”

JAIME DIDOMENICO Title: President Company: Cool Today Website: cooltoday.com Year Founded: 1963 Headquarters: Sarasota, Fla. Work Performed: Residential & Light Commercial HVAC, Plumbing and Electrical No. of Employees: 200 Annual Revenue: $31 million Vendor-Partners: Carrier, Mitsubishi, Honeywell, Nest, GreenFiber Affiliations: Nexstar Network Certifications: North American Technician Excellence (NATE)

A year later, DiDomenico had the opportunity to move from the warehouse to the accounting department where he began to thrive. First as a clerk, then as an accountant before becoming accounting manager in 1984. With supervisory responsibility over payables and receivables, DiDomenico acted as an assistant to Encore’s controller. Though Hofstra may not have worked out for him, he gained real business experience in Florida — and gave college the old college try again. He earned both a bachelor’s degree in business management and a master’s degree in accounting from Nova Southeastern University. In 1992, he passed the CPA exam. When the company was purchased in 1993 by Roto-Rooter, he seized on an opportunity to move into operations management as a branch manager in West Palm Beach. “After a few years there, I was hand-picked to join a consolidator, BlueDot, as a vice president,” DiDomenico remembers. “That expanded my boundaries as I learned how to manage multiple locations in several states.” It was the opportunity with BlueDot where DiDomenico first came across N&M. He purchased the company for BlueDot in 1998, then later purchased it again for himself and a couple of partners in 2004. Although N&M had been around 41 years at the time, it was a small $2 million residential service and replacement company with about 16 employees. It’s been at N&M — first rebranded as N&M Cool Today, and then as simply Cool Today — where DiDomenico has found his true passion: people. “I love people. I especially love seeing people grow and succeed in their careers and personal lives,” he says. “We are a people business, and if you don’t love dealing with people, you will struggle to deliver a strong, binding mission that promotes teamwork and growth.”

DiDomenico has continued to take risks like a true entrepreneur, while continuing to maintain long lasting relationships with customers, team members and the community. The business has had it’s challenges over the years — poor timing of a new construction division in 2006, growing too fast for infrastructure and cash to catch up, changing direction faster than team members could adjust — but DiDomenico recognizes it’s all been a direct result of his goals. “I am a trained professional in accounting and management, but I yearn to build things, grow things and create opportunities,” he says. “To do this on a larger scale, you have to step up, put your personal investments on the line, put an enormous amount of time and effort and risk everything financially and possibly your reputation.” Cool Today joined Nexstar in 2010, focusing on great trade expansion, bringing customer relationships to the forefront and investing in training for its people — something that has helped Cool Today grow three times in the past seven years. What started in a market area of about 700,000 has now expanded into an area of more then 3.5 million. “I see us becoming well established in the entire Tampa Bay market,” DiDomenico says. “This includes our original home base of Sarasota, our new venture in Dunedin (Pinellas County) and our most recent acquisition of Alert Air Conditioning in Tampa, Fla.” DiDomenico has created an atmosphere and culture that is poised to handle the technological challenges this industry faces. He firmly believes smart home technology will be ever present and widespread in 5 to 7 years — and large technology companies are trying to solve the complete-serve challenge to the homeowner. “How we’re addressing this, or preparing for it, is to not resist change, but embrace it where possible,” he says. “We’re getting in the cage with the tiger to feed him, and hope he never mistakes the steak for the handler.” u

Pete Grasso is the editor of HVACR Business magazine. Email him at pgrasso@hvacrbusiness.com.

Throughout his time as president of Cool Today,

HVACR BUSINESS MARCH 2018

www.hvacrbusiness.com

FINANCE

BY RUTH KING

Try a New Pricing Level, Improve Your Bottom Line

recently met with a new client and redid his pricing based on his actual costs and the net profit per hour he said he wanted. His reaction — “We can’t charge that!” I told him to try the new pricing anyway. What happened? He was awarded the first job he bid with the new pricing and easy pricing format I gave him. Another contractor was complaining that he hated duct jobs. When I asked why, he said that they never made money. So, we created pricing for duct jobs. Anything below those prices, he walked away. It wasn’t worth it to him. Once he implemented that pricing he no longer hated duct jobs because he was earning a profit on the ones he did. If you use flat rate pricing for service, increasing your service rates $50 per hour only increases the customer’s repair cost by $12.50 for a 15 minute repair and $25 for a half hour repair. Customers rarely notice the increase. You will see the increase in revenue, and hopefully profits, because of the number of service calls you perform. Let’s assume that you really can’t charge a higher price. Here are five options

BREAK EVEN Break even occurs when your net profit per hour is zero. Add your overhead cost per hour and your direct cost per hour. This is the absolute minimum price you must charge your customers. Below this price, your company will operate at a loss and eventually go out of business.

OVERHEAD COST PER HOUR Determine whether your overhead cost per hour is too high. If your field labor has less than 60 percent billable time, then your overhead cost per hour is probably

each additional field person adds $2,000 to overhead. Increasing revenues might mean reactivating inactive customers,

asking for and receiving referrals, or another type of marketing. continued on page 8

too high. Normally you don’t see this with replacement. Many service departments are unprofitable, however, because the technicians’ unbillable time is too high. If this is the case, start tracking billable hours. They will increase and your overhead cost per hour will decrease.

BILLABLE TIME If your overhead cost per hour is too high and your field labor is productive (more than 60 percent billable time), then look to increase billable time, if possible. Ask your field personnel how they can bill one more hour a week. Or, how they can get to replacement jobs quicker. They have the answer. Implement their suggestions.

GENERATE MORE REVENUE If it isn’t possible to generate more billable hours, then it’s time to generate more revenue and hire more field personnel. More field personnel means more people who share the overhead and the overhead cost per field employee decreases (see Fig. 1 for an example). Your overhead will increase slightly with each additional field person you hire. You need a truck, mobile phone, etc. It will not double with each additional field person. In this example I assumed that

Fig. 1 No. of field personnel

Monthly Overhead

Overhead/person

$10,000

$3,333

$12,000

$3,000

$14,000

$2,800

www.hvacrbusiness.com

HVACR BUSINESS MARCH 2018

continued from page 7

Print out a list of customers who have used your company in the past but not in the past 18 months to five years.

There will be a lot of customers. Contact them (email, direct mail, text) and get them back. This will increase your revenues and decrease your unbillable time.

INCREASE BILLABLE HOURS If you can’t add more people because your existing personnel are not busy 40 hours per week, then each field employee must increase their billable hours.

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This can be accomplished by: • Technicians recommending repairs that are needed but are not causing the system to fail at the time of the service call (i.e. a weak capacitor, pitted contactor, etc.)

If it isn’t possible to generate more billable hours, then it’s time to generate more revenue and hire more field personnel. • Installation crews getting to their jobs faster (no warehouse supermarkets, materials are pulled and put in a specific place in the warehouse, staggering the times the crews come in or they go directly to the job for multi-day projects) • Something else your field personnel recommends. Always try the new pricing level before assuming that you can’t raise prices.

Choose the ECM pump with the performance and features you want, without buying more than you need. Every 00e Series® pump we make is designed for easy installation and setup with some unique

Even at the new pricing levels, when you implement the suggestions above, you will improve your bottom line. u

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HVACR BUSINESS MARCH 2018

Ruth King is president of HVAC Channel TV and holds a Class II (unrestricted) contractors license in Georgia. She has more than 25 years of experience helping contractors, distributors and manufacturers grow their companies. Contact her at ruthking@hvacchannel.tv.

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THE GENIUS OF LEADERSHIP Change the way you think, set a direction and then build a team of personnel to achieve the end game

BY GARY ELEKES

e all crave good leadership. It’s exciting, challenging and rewarding to be involved with effective leadership, and it can be frustrating as an employee when leadership is off course. One of your main opportunities in contracting is to find, recruit, hire, train and develop people around you to improve your company’s execution. In this era, developing and creating that environment for prosperity is difficult unless you understand the true genius of what leadership can accomplish. Simply put, effective leadership is rare in business and in life. It is only occasionally that you see the kind of leadership you wish you could be exposed to in your own business lives. The individuals in the organization trust this direction and course so well — they buy-in to the direction and course with such passion — that they follow and

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not for your people.

Leadership requires constant communication, reinforcement and discussion about the vision, values and behaviors, and how it all relates to the purpose of the company. become less individuals and more of a team defined by the culture set up by this leadership principle. It requires constant communication, reinforcement and discussion about the vision, values and behaviors — and how it all relates to the purpose of the company. When these attributes are present, most team members will do whatever it takes to make certain the direction is fulfilled.

HOW IT APPLIES TO YOU You’re building a business and improving the performance of the business at the same time. This business of yours is, in many cases,

As a leader, you have to be able to hold them accountable for the work they perform at the standards you’ve established, and that means you have to create an environment of accountability and standards in the first place.

like one of your very own children and, in some cases, you may spend more time with it than with your family as a sacrifice to build for them. Suffice to say, the amount of energy, time, desire, passion and sheer will required to make the business grow and prosper is enormous. Yet rarely do you see the owners working on improving his/her own leadership skills — to grow themselves personally so that, as the business grows, the owner stays ahead of the needs of the business and the people inside of the business. You need to frame your leadership practices to be responsible to your people,

In an issue of Harvard Business Review, there was an article in which Jeffrey Immelt, who replaced Jack Welch as CEO of General Electric, discussed how much time he actually spent in the development of people in GE, not just his direct reports. These are the key leaders inside GE. He stated that more than 40 percent of his time was dedicated to the development of these people, because they were so crucial to completing the work of GE. That choice of priority is certainly a large time dedication, especially for a small business owner. continued on page 10

HVACR BUSINESS MARCH 2018

continued from page 9

No matter how successful you are, if you’re not committed to constant change and continuous self-improvement, the business eventually will grow to your level of incompetence.

The truth is, the smaller the business, the more critical it is for this behavior to occur, which is opposed to your technical nature in the trades of doing the key work yourself. The time spent developing your people is critical, and in many cases probably should exceed 40 percent of your time. The real issue is when you spend time with them, what are you doing?

direction, and then building a team of personnel to be able to achieve the end game towards this direction, there are a number of things that MUST happen every day:

If effective leadership is about setting

• Have a clear, well-articulated vision for

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the company • Define core values and the behaviors that a company wants from each value • Set concise expectations and standards for each role — tie these to individual goals • Develop this talent by making the tools, training and resources available to execute • Be willing to always change — change is part of the fabric of the company • Foster ongoing communication — a positive environment to work and learn • Operational excellence/execution — Measure the metrics (KPI’s) and communicate them

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• Reward excellence — share the wealth but also appreciate, show respect, give recognition These ideas may seem like common sense, but while they are in practice within your industry, proper and complete execution is a rare occurrence. Far too often you see only some of these areas being practiced, which lead to more bumps in the road than needed to happen. It all comes down to one issue: Leadership must be aware and understand the need.

TIME AND COMMITMENT Everything defined here is grounded in the concept of developing other leaders, and the accountability for these ideas being effectively implemented is the responsibility of the primary leader or owner of the company. You have to set the structure and raise others around you, and that takes time and commitment. The good news is, because leaders are developed and not born, you can adapt

HOW TO IMPROVE YOUR LEADERSHIP 1.

Commit to changing the way you think.

Find people who are smarter and better at what they do than you are, and develop a personal inner circle.

Seek a mentor, someone who can give you a non-biased opinion that is candid and fair to help you grow and learn new skills.

Self-evaluate what kind of a leader you really are and look at a self-improvement plan. Develop the plan and take action.

Define a personal vision and mission in your life. What is your purpose and why are you doing what you do? This will not only add clarity, but incredible focus.

Refine your personal and professional goals.

Start mapping out how you have to change to become more effective at leading your company and your employees.

Map out how the business has to change. Set your priorities and begin changing — based on your priorities. Ask questions in your business practices — Why do we do it this way?

Make time in your schedule for clear, inspirational thinking time.

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10. Maintain a planning period that allows you to reevaluate your position, skills and goals regularly. Once a month is a minimum. — Gary Elekes

w w w. s p e c t r o l i n e. c o m

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your leadership skills and improve, thus becoming more effective at leadership. If you want to change, you can. The human mind can focus and achieve anything if you desire it. One of the human mind’s greatest attributes is its ability to adapt and change. Sometimes you simply ignore that potential or allow yourself to be distracted by the “static” around you, the daily crises in contracting. When that happens, you have no method to reinforce your goals, your leadership work requirements to help others become more effective. You have to learn to become an effective business leader first, before you learn to become effective at the business. Most of this industry started by getting into the business first and becoming immersed in the work of the business, never really committing to the idea of changing themselves along the way as they grew the company. Even leaders with natural skills who focus on doing so many things correctly can get trapped in a comfort zone. They may not continue to challenge themselves to change and become even more effective leaders. No matter how successful you are, if you’re not committed to constant change and continuous self-improvement, the business eventually will grow to your level of incompetence.

CONTINUOUS SELF-IMPROVEMENT Leaders who want to continue to grow learn this lesson early, as noted by leadership expert and author John Maxwell: Change is personal — I can identify what I want changed Change is possible — I can do it Change is profitable — I am rewarded Maxwell calls these the three Ps of change. Becoming a better leader of your company and for your people requires a personal change. Of course it is possible, and if you’re focusing in on changing the right kinds of leadership attributes in your personality, it will no doubt be profitable as well.

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Don’t change for the sake of change, but under real, necessary change, such as adding specific processes to your business so you can train personnel to the right standard and do it correctly each time. The whole point of learning to become an effective leader of a contracting company is to reach your chosen goals, whatever they are. Are you at your stated goals? If not, you’ll likely have to change and this will likely require you to improve your leadership skills to reach said goals.

CLEAR AND INSPIRED THINKING As an owner or key leader in your company, you need to have a place and time to create clear and inspired thinking so you have the ability to sort through the challenges. Planning time is usually robbed and forsaken for crisis time, but these are choices made by people who do not understand how to get out of the time trap.

how to compete differently to improve. To improve, one must stretch themselves to the limit. Surrounding yourself in business with people who challenge you to think differently is the same concept and will only lead to you learning a great deal from them. This requires a certain humility and courage as well as trust, and is a good reason to have a mentor or coach, or people around that will be honest with you about you.

It is heady stuff, yet if you take the journey’s first step, which is to realize your company depends on you to adapt first and help raise others, you are well on your way to time and money freedom. The challenge requires dedication, discipline and a desire to adapt, but the journey to becoming the best leader you can be is well worth it. u

Gary Elekes is president of EPC Training and has more than 20 years of experience in the contracting industry. He is also a founding faculty member of EGIA Contractor University, which provides contractors with the training, tools and resources to build the business and life of their dreams. For additional information, visit egia.org/university.

Becoming a more effective leader is hard work and requires you to self-reflect on who you are now and what you aspire to in business and in life.

To be effective at leading your people and setting your direction, and even defining the goals of your company, you need time for yourself that allows you to think clearly and with enthusiasm.

WILLINGNESS TO CHANGE You must understand that changing your performance changes your life, and you must embrace the need to adapt. Don’t change for the sake of change, but under real, necessary change, such as adding specific processes to your business so you can train personnel to the right standard and do it correctly each time. That requires change if you are in control and feel the need to have it done “your way” — you may have to change. A willingness to adapt is required, or you will not reach the next level.

YOUR PEOPLE Surround yourself with people that are at another level than you. A great lesson in sports is to always go up against people who are better than you, so you will always have a focused effort on improving. Competing against those who are already better than you make you figure out

HVACR BUSINESS MARCH 2018

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MASTER SEO & LEAD GENERATION Your marketing must include a comprehensive strategy to engage with and obtain new customers online

BY MICHAEL HAINES

or a long time now, most marketing strategists have been bending over backward to master SEO techniques. Why? Because if you’re invisible online, your business doesn’t exist.

An overwhelming majority of your potential customers will find their businesses in the simplest possible way — by searching online.

That’s true of all businesses, even HVACR contractors. It doesn’t matter how blue-collar and down to earth your operation may be, your marketing arm absolutely must include a comprehensive SEO and lead generation strategy.

has immediate and drastic implications for SEO strategists.

An overwhelming majority of your potential customers will find their businesses in the simplest possible way — by searching online.

To dominate the search results, you have to take complete control of local SEO. Mobile devices are using location services to tailor search results to the user’s immediate vicinity, and Google is getting shockingly good at doing so accurately.

The crucial change is how they’re doing it. A few years ago, a lot of people were still doing that kind of thing from a laptop or desktop computer. According to Google, nearly 60 percent of searches are from mobile devices. This

There’s great news, though — the “rules” of localized SEO are no longer changing as rapidly, and these new rules aren’t particularly hard to implement.

Google changed everything — again — when they rolled out the “local 3-pack” view, replacing the older method, where seven businesses were visible in local

HVACR BUSINESS MARCH 2018

search results. That was a big shakeup for the SEO industry, but it presents an opportunity. Now, reaching your potential customers requires ranking high in the search engines as a local business in the Top 3. A tall order? Maybe, but it’s hardly impossible. How do you do that? By improving your local ranking. Here’s what you need to do:

GET LISTED If you haven’t already, get on Google and get listed! This is Step Zero, because you can’t follow any of the other steps

until you’re on this one. It’s shocking how many businesses haven’t taken this step, though. It isn’t enough just to submit a URL to Google’s Search Console and have a Google+ account. Google doesn’t quite have a monopoly on Internet searches, but they do have a 64 percent share of U.S. searches as of 2016. That’s triple the share of Microsoft, the next biggest game in town. So if you want to be found, sign up for Google My Business and then follow the rest of the optimization tips in this list.

CITATIONS The Google Local 3 Pack listing is shown at the top of the search results pages for certain high value keyword searches that your prospect’s type into their browser. Up to 50 percent of the clicks that occur on the search results pages happen

www.hvacrbusiness.com

That means if you aren’t in the top three, you are missing out on half your opportunities from prospects looking for repair, installation or maintenance from a local contractor like you. These high click-through rates make perfect sense when you think about it: Google is encouraging searchers to click by highlighting these results and placing them front and center. To anyone searching, Google appears to indicate the Local 3 Pack offers the best result based on the keyword searched. A citation is literally any online reference to your business information. They are split into partial citations and full citations. A partial citation only mentions part of your name, address and phone number (NAP) — perhaps just your name and phone number — whereas a full citation includes all of it. A full citation might look something like this: HVAC All-Stars, 123 Carrier Avenue, Anywhere, USA 00000 Citations are heavily used to rank your website in the Local 3 Pack that displays just under the paid ads for certain keyword searches related to your business. Google uses the number of citations your business has to determine the validity of your business. Citations do not need to be linked back to your business website for you to get credit. That helps though, because it means that a plain text citation is as valuable to you as a link. Having 100 citations is a great starting point for your business if you want to dominate the rankings, however, 200-300 is even better for the best possible ranking consideration by Google for the Local 3 Pack. Here’s a critical insider’s tip — you need to use military precision when formatting citations. That means the same spelling, punctuation and abbreviations (don’t use “St.” and “Street” interchangeably, for instance) must be used in every citation for it to be counted in your favor. Your citations must also match the NAP on your Google+ Local page and your business’ website. The key to successful citations is consistency.

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Google places an emphasis on link building and citations, which is why Yelp, Yahoo, MapQuest and other reputable listing sites are important if you want to improve your online presence. You can get citations from directories, blogs, forums, social media, press releases, FAQ sites, image and video captions and forum signatures, so feel free to get creative.

LOCAL DIRECTORIES Google works hard to only show their users the most relevant information. They’re looking at sitemaps, metadata, tagging, URL structure, keyword content, SEO practices, mobile optimization, citations, reviews and online links from unaffiliated websites. That’s a lot to contend with, and having a strong presence on local directories is going to help you with several things from that list. Google places an emphasis on link building and citations, which is why Yelp, Yahoo, MapQuest and other reputable listing sites are important if you want to improve your online presence. Here are some contractor-specific directories. They’re not all free, but the ones that charge are more than worth the expense. • yellowpages.com • servicemagic.com • manta.com

Paying for reviews can be dicey, and some consider it tacky to ask for them, but you’ve got to have them to be successful. This way, when you do crack the Google Local 3 Pack map listings in a search, you’ll have more strong reviews than the competition. That ought to make the decision easy on your potential customers.

EMBED A GOOGLE MAP It’s a good general practice to include an embedded Google map containing your business market on your site — especially on your contact page or any page that contains contact information.

Embedding is very simple, you can grab the embed code by searching for your own business in Google Maps, clicking the menu bars to the left and clicking on “Share or Embed Map.” Google has gotten very sophisticated — they’re more than capable of filtering data to provide their users with the most relevant local results. That means that an enterprising local HVACR company with a good SEO strategy will see greater results, lead generation and the associated revenue increase. u

Michael Haines is founder of AC4Life.com, an HVAC e-commerce site, and co-founder of Triple Your Clicks. You can contact him directly at email mhaines@tripleyourclicks.com or call 407-701-9520.

www.ronsmithhvac.com

in the Local 3 Pack.

A follow up to the best-selling book ever in our HVAC Industry

• superpages.com • bbb.org • angieslist.com • dexknows.com • local.yahoo.com • yelp.com • merchantcircle.com

GET REVIEWS An argument could be made that reviews are the most important element of any good strategy. People are more likely to trust information about your business if it comes from someone else.

Featuring: » A complete chapter on residential service agreements. » Key performance indicators. » Acquisitions of other HVAC companies. » The Future of HVAC. » Plus, much more valuable information.

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HVACR BUSINESS MARCH 2018

BRANDING

BY RYAN HOLDEN

Create Your Message and Grow Your Brand

randing is the identity of a company. The stronger the brand message is, the more distinct the company’s identity will be. A recognizable brand with a strong identity is one of the foundations of business success, in the HVACR industry and every industry.

CREATE A BRAND MESSAGE If you don’t have a powerful brand message, your company may not stand out from competitors in a positive way. Coming up with a brand message is a

Coming up with a brand message is a smart strategy, whether your company is new or it’s been around for years. smart strategy, whether your company is new or it’s been around for years. It’s never too late to brainstorm and create a brand message which hits the target with your ideal customers. The brand message should be short, succinct and designed to convey the purpose

and values of your business. For example, is your company committed to delivering superb customer service to members of the local community? Do you offer specialized HVACR expertise which makes it a better choice for consumers than other companies? Think about the values and purpose of your company. Then, come up with a brand message which is no longer than one paragraph. Then you can use this brand message to get more from your marketing, advertising and branding efforts.

COME UP WITH A CUSTOMER AVATAR A customer avatar is a “character.” It’s a composite of all of your customers. This character is the person at whom your branding efforts will be aimed.

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HVACR BUSINESS MARCH 2018

To create this character, review any information about your customers you have. Are they usually younger or older? Are they typically male or female? Which products or services did they buy? Also, think about conversations you’ve had with your customers. Did your customers share information about themselves and their passions and interests? Did they share information about how they feel about your company? Once you’ve done some hard thinking, begin to put together the customer avatar. It might be a middle-aged male with a middle-class income and an interest in home improvement. It might be a younger woman with a lower income who needs a freestanding air conditioning unit for her rental apartment. After you have the avatar, give him or her a name and write up a little backstory. This may seem a bit silly, but it isn’t.

Keep your character in mind when you’re planning your marketing strategies. You’ll find that branding and marketing with the character in mind allows you to target the right types of prospective customers.

LONG-TERM RELATIONSHIPS Sometimes, the best branding is based on a five-star business reputation. This type of stellar reputation may be marketed easily. It speaks for itself in many ways. The best way to get the five-star reviews that you need to build your brand is to put a lot of care into nurturing your long-term relationships with your customers. When you get customer loyalty, you’ll get good reviews, word-of-mouth advertising and referralsConsider your relationships with your customers as branding for your business and act accordingly.

START TODAY Branding has many “moving parts” and it’s something on which every smart company owner spends time. If you think you’re too busy and don’t have time for branding — which is so important to your company’s future — you may consider outsourcing the tasks. Many companies offer branding services for affordable rates. Just be sure to do your research and choose a wonderful provider with a strong and positive reputation. u

Ryan Holden is a former HVACR technician and is currently director of Progressive Heating & Air in San Diego. For additional information, visit progressiveairconditioning.com.

www.hvacrbusiness.com

LEADERSHIP

BY BOB MCEWAN

A Safe Workplace Starts with You

prah Winfrey’s speech at the Golden Globes was certainly powerful. It highlighted the current events and activities over the last few months regarding sexual harassment in the workplace. The #MeToo movement has caught the attention of millions of Americans as more and more women discuss their past encounters with superiors taking advantage of their position of power. The exposure has been the greatest on the media and government industries, but as a leader of thousands of people over a 34-year career at GE Aviation in manufacturing and engineering, I am no stranger to it. It’s long overdue that all industries and businesses recognized the issue. Sexual harassment, workplace violence and hostile work environments are not acceptable. They are wrong, they promote behavior that is unacceptable and they destroy morale and teamwork. As I progressed through my career with increasing responsibility, I dealt with this challenge every day. Sexual harassment/ hostile workplace starts with you; no matter what your position or level in the organization. Obviously, the further and higher you go, the more responsibilities, thus the ability to influence these practices and policies is greater.

HOW IS YOUR COMPANY’S CLIMATE? Do you have a robust sexual harassment policy? Do you and your managers buyin? When was the last time you and your staff had training? Is it time to refresh? The C-Suite is a major contributor to the atmosphere and culture; they set the tone for these behaviors. Executive leaders must walk the walk; their everyday actions must reflect these policies.

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Sexual harassment, workplace violence and hostile work environments are not acceptable. They are wrong, they promote behavior that is unacceptable and they destroy morale and teamwork. You need to make it a priority, a minimum expectation for everyone. You can’t wink or look sideways on sexual harassment/hostile workplace. Bold, decisive actions are required. It needs to be part of you company’s DNA.

IT STARTS WITH YOU I started as a front line supervisor in a jet engine factory in 1979. Men dominated the workforce. Rarely did you see a woman in what was described as a traditional machinist role. The supervisors, the engineers the management leaders were all men. So my exposure to women in the workplace was limited. As expected, women fielded many of the clerical and administrative assistant positions. Heck, we didn’t have but one ladies’ bathroom in the whole factory. That was life as I saw it. Early in my career, these behaviors were commonplace: “cat calls” when a woman would walk through the manufacturing shop, posters of “Playboy-type photos” hanging in toolboxes and language and jokes that went beyond the “locker room” talk. This was reality and there were times when it made me feel uncomfortable. I also witness strong-arming, threatening behavior some physical in nature by both management and labor groups. The entire atmosphere of the workplace was tense; early in my career I had a boss who could have been a poster boy for “How to intimidate your workers.” I did react to these things. I am no saint when it comes to language, however, I thought it appropriate to temper language

when conducting business meetings. It started with me. I set the example; it was something I continued throughout my career. Over time the pictures and posters became something that didn’t fit into an inclusive, embracing and non-threatening environment. Later in my career, with everyone having access to laptops, we had folks who frequently searched the Internet visiting pornography sites. We dealt with these people quickly and swiftly. Zero Tolerance. These actions may seem small, but small things add up. It starts with you.

PROGRESS AND EDUCATION As the years progressed and more women join the workforce as technicians, machinist, engineers and supervisors, we needed to change. We initiated training and formal educational programs to understand these new dynamics in the manufacturing shop. This transition started around the mid to late 1990s. Much of the training focused around the workplace and its environment. We took a broader look and educated folks on behaviors that allowed all people to feel comfortable and accepted in the business. During this time, I had a female employee come to me regarding someone in my organization who was sexually harassing her. This was a new one for me and at first I had my doubts this was occurring. I held some of the old thoughts that men will be men and boys will be boys. I

may have jumped to conclusions prematurely. I did investigate, however, and it was proven — and we did fire the offender. Good leaders must listen to their employees, keep their door open and follow up on concerns. Once employees don’t feel comfortable coming to you with issues, you’ve lost their confidence. This event sent a strong message throughout the organization. It starts with you.

MAKE YOUR TEAM COMFORTABLE Don’t be an enabler. Think of the Matt Lauer case where a worker placed a button on his desk to lock his office door. Doesn’t this sound strange. The person who installed this lock didn’t they think it was out of sorts? I know its tough to speak up and report especially when the star player is involved. Provide a mechanism for employees to report these concerns that protects their identity. Keep the communications open. Be transparent with your team. Make it comfortable for people to report. It starts with you. Leaders share values. I credit my father with teaching me and showing me through his daily actions. He shared his values about marriage, women and treating all people with respect. Great leaders and good companies know how to do this — it’s time for you and your team to step up and make a renewed commitment to yourself, your team and your company. Remember, it starts with you. u

Bob McEwan, who retired as the general manager of GE Aviation’s global supply chain, continues to consult with GE Aviation, its partners and other aerospace companies in engineering and supply chain management. He also conducts leadership seminars for executives and corporate staffs. For additional information, visit mcewanleadership.com.

HVACR BUSINESS MARCH 2018

PRODUCT FOCUS »

Residential Thermostats

BOSCH

HONEYWELL

NEST LABS

The Bosch Connected Control (BCC100) is a full-color, 5-inch, touch-screen thermostat that offers Wi-Fi connectivity and allows remote monitoring and control of home HVAC systems. The BCC100 is programmable, giving users the option to either follow factory-loaded presets or create their own, personalized schedule. Its intuitive scheduling menu helps maintain the most comfortable environment, with a dedicated terminal for humidifying or dehumidifying functions. The Bosch Connected Control automatically turns the heating and cooling on and off to maintain temperature while homeowners are out of the home.

Built on Honeywell’s more than 125 years of experience with controlling home comfort, the Lyric T6 Pro is powered using a hardwired setup via a common wire and combines the confidence and reliability of Honeywell thermostats you know and expect with modern connectivity; including convenience for you. The Lyric T6 Pro requires no elaborate programming, no lengthy or unreliable learning curve, and no guesswork allowing for easy installation that takes less than 30 minutes. Remote diagnostics allow for more connections with customers and opportunities to increase sell-in. The Lyric T6 Pro is compatible with 24volt systems, including forced air, hydronic, heat pump, oil, gas and electric.

The Nest Thermostat E comes with proven energy-saving features that help your customers save from day one. The Nest Thermostat E turns itself down when the homeowner is away, and they can control it from anywhere. The Nest Thermostat E’s frosted display blends in beautifully. Up close, everything you see is soft and subtle, like a watercolor. And it all disappears when you walk away. With the Nest app, change the temperature from the beach, the office or even in bed. The Nest Thermostat E’s energy-saving features have saved people an average of 10 to 12 percent on heating bills and 15 percent on cooling bills.

forwardthinking.honeywell.com

TRANE

JOHNSON CONTROLS

ComfortLink II XL1050 works with a network of sensors to monitor and optimize humidity and temperature in a home, adjusting compressor and fan speeds in real time to give your customer the most comfortable air operating efficiency possible. Additionally with Nexia, homeowners have the flexibility to remotely monitor and control hundreds of devices such as their home’s lights, locks and even garage door from virtually anywhere with the Nexia app or with the convenience of their voice through an Amazon Alexa enabled device.

bosch-climate.us/bcc100

CARRIER With Carrier’s expanding family of Côr thermostats, there’s sure to be an option that’s right for your customer. These thermostats can even teach customers ways to manage their comfort and optimize energy savings. With the touch of a button, the Wi-Fi capable C Series thermostats give homeowners unprecedented control of their comfort and energy use, by showing them how to drive down what they spend. Carrier now offers an array of products, from premium thermostats that are Wi-Fi capable to thermostats that are stylish, versatile and attractively priced. carrier.com/cor

EMERSON The new Sensi Touch Wi-Fi Thermostat combines proven smarthome technology with a color touchscreen display and sleek, minimalist appearance that will be at home in any modern living space. Emerson’s new Sensi Touch Wi-Fi Thermostat — along with an updated version of the classic Sensi Wi-Fi Thermostat — is now compatible with smarthome management platform Apple HomeKit, bringing simple and secure control using the Apple Home app on iPhone, iPad or Apple Watch, or voice using Siri. The new Sensi thermostats build upon the brand’s legacy of connecting precise temperature control and convenience to ensure the highest level of home comfort. In addition to the Apple HomeKit integration, both Sensi thermostats are compatible with smart home platforms Amazon Alexa and Wink. sensicomfort.com

HVACR BUSINESS MARCH 2018

GLAS is the first smart thermostat of its kind to use a translucent OLED touchscreen display to control its functions. Users simply touch the screen to change the temperature, monitor indoor and outdoor air quality, track energy savings or perform other functions. Alternately, GLAS can be controlled by mobile app or by voice, thanks to Microsoft’s voice-enabled digital assistant, Cortana. When it’s not in use, the screen seamlessly blends in with a building’s environment. GLAS adapts to a user’s schedule to intuitively and attentively maintain a comfortable space while it saves energy. After a user sets preferred temperatures for Home and Away modes, GLAS’ smart logic helps save energy by detecting when a space is occupied or empty, and automatically adjusts its settings accordingly.

pro.nest.com

trane.com/residential

VENSTAR

The new KONO Smart thermostat was made with the customer in mind. With KONO Smart, we’ve made it personal. And it’s more than a pretty face, there are numerous smart features to love about KONO too. The Home and Away Aware feature automatically adjusts your comfort and savings. Just as in HVAC where compatibility is paramount, it is also extremely important in Smart Home. KONO Smart connects effortlessly with major smart products like Amazon Alexa, Apple Home Kit, and the Google Assistant.

At just 3.2 inches wide by 3.2 inches high and less than an inch deep, Venstar’s Explorer Mini thermostats help save energy and improve indoor comfort while taking up less wall space. Explorer Mini is the most affordable Wi-Fi thermostat on the market. It is now available throughout North America from Venstar’s exclusive network of wholesale HVAC distributors. Venstar’s Explorer Mini features include: built-in Wi-Fi, enabling remote access to monitor and control; seven-day programmability and multi-stage control; small, compact size and simple to install and a large, easy-toread display with bi-color LED heat/cool indicator. Explorer Mini is also compatible with Amazon Alexa.

pro.luxproducts.com

venstar.com

glas.johnsoncontrols.com

LUX

www.hvacrbusiness.com

PRODUCT FOCUS »

Commercial VRF Systems

CARRIER

JOHNSON CONTROLS

MITSUBISHI

Carrier’s family of VRF products offers a wide range of systems to meet an expansive array of applications from residential to larger commercial buildings. The Carrier 38VMH VRF heat pump system is a combination of an outdoor unit with multiple style indoor units connected by refrigerant piping and wiring. Heat pump capacity ranges from 6 tons up to 36 tons in a modular design, available as single, double or triple module.

Johnson Controls has launched the YORK Variable Refrigerant Flow (VRF) Gen II, the second generation of VRF HVAC equipment for the North American market. YORK VRF Gen II offers many significant enhancements including a re-engineered outdoor unit line with an impressive operating range and a wider selection of single module sizes and an indoor unit line that includes re-engineered ducted units with greater static pressure, a full range of multi-port change-over boxes for heat recovery systems and enhanced controllers. In addition to offering higher-static ducted indoor units in multiple sizes, the new lineup also includes non-ducted units in more capacities.

Mitsubishi Electric US, Inc.’s Cooling & Heating Division’s latest innovation in Variable Refrigerant Flow (VRF) technology is the CITY MULTI L-Generation Air-Source outdoor units. The L-Generation (6 to 30 tons; single modules up to 14 tons) has achieved significantly improved efficiency ratings due to HexiCoil technology, a zinc-aluminum flat tube heat exchanger that maximizes heat transfer capability through its unique fin shape. Increased efficiencies across all categories make this outdoor unit ideal for projects with efficiency goals such as LEED certification or net zero status.

carrier.com

DAIKIN Daikin VRV IV S-series is a complement to the renowned Daikin VRV family of cooling and heating systems, and brings the technology into smaller applications including light commercial and residential single family homes. Daikin’s VRV IV-S Series is available in smaller 3, 4 and new 5-ton capacities with a 208-230V, single phase power supply. A maximum of 6 indoor units can be connected to the 3-Ton system, up to 8 indoor units can be connected to the 4-Ton system and up to 10 indoor units can be connected on the 5-Ton system. The versatility of VRV IV-S Series makes it ideal for most light commercial or residential projects — retail store, small office, restaurant, hotel, healthcare facility, school, multi-family townhouse, condo or single-family home. daikinac.com

FUJITSU GENERAL Fujitsu General America, Inc. has expanded its Airstage V-II VRF equipment line of Variable Refrigerant Flow (VRF) heat pumps, with enhanced capabilities and operational efficiencies. The latest series now includes 6, 8, and 10 ton condensers, helping to reduce the number of condensers in certain configurations. V-II 230V/3-phase, zoned VRF systems offer large capacity, operational efficiencies up to 24.30 IEER (to AHRI 1230 standard) and are an ideal heating/ cooling solution for small and large buildings. Airstage systems avail a lineup from 6 to 24 tons with a connectable indoor unit capacity ratio up to 150 percent, while also allowing up to 45 indoor units per bank of three condensing units. fujitsugeneral.com

www.hvacrbusiness.com

johnsoncontrols.com

LENNOX Lennox variable refrigerant flow outdoor units offer multiple installation options, along with many other benefits to installers, developers and owners. Lennox VRF Heat Pump units offer a heating and cooling solution capable of conditioning up to 63 zones from a single system. Individual set point control, in combination with an inverter driven compressor, provides a highly efficient system that optimizes the system capacity by adjusting the compressor speed based on the required capacity at each indoor unit. lennoxcommercial.com

mehvac.com

PANASONIC All Panasonic three phase outdoor units (230/460V) are designed and built with Integrated Innovation. The compressors are Inverter Rotary that facilitates capacity modulation to precisely match each zone needs, thus delivering only what is required to maintain zone temperature, be it in cooling or heating. Compressor oil management developed by Panasonic is an Intelligent 3 stage Oil Management System. This combination of innovative technology solutions employed by Panasonic ensures reliable and cost-efficient operation without compromising comfort. business.panasonic.com/hvac

SAMSUNG

LG Multi V 5 is the flagship product in LG’s stateof-the-art air-source VRF systems. Representing the next generation in the popular LG Multi V family, Multi V 5 is available from 6 to 42 tons, with a choice of three-phase 208V-230V or 460V electrical power as heat recovery/heat pump outdoor units. New to the Multi V line-up are the single frame 16, 18, and 20-ton units. The 20-ton unit represents the largest tonnage single frame on the market today. The Multi V 5 unit boasts the benefits of VRF technology, as well as enhanced features to ensure users have improved comfort and energy-efficient function.

Samsung’s VRF systems are also known as DVM (Digital Variable Multi) S systems. The DVM S product lineup consists of: heat pump, heat recovery, water, and chiller systems. DVM S systems range from 6 tons to 20 tons. Each DVM S system is equipped with an inverter scroll compressor and flash or vapor injection technology. These systems are often space saving and provide high energy efficiency to help achieve better performance, reducing installation and maintenance costs. Samsung’s DVM Chiller combines the strength of both VRF and traditional chiller systems. DVM Chiller empowers reduced annual utility costs compared to conventional systems.

lg-vrf.com

samsunghvac.com

HVACR BUSINESS MARCH 2018

BUSINESS INSIGHTS »

FRANCHISING

New Family, Continued Legacy When you become a One Hour Heating & Air Conditioning® franchisee, you not only keep your company’s history, you also gain an entire network of support

CHRIS BAUMANN ot many HVACR contractors can boast a service history that spans seven decades, but the Peoria, Ill. area has been fortunate enough to have one of those companies.

Founded in 1948 as AAA Heating and Air and merging with Northgate Heating and Air in 1981, AAA Northgate Heating & Air, LLC, was purchased by Chris Baumann in 2012. With that kind of legacy, you can imagine his hesitation when he began talking to Clockwork, Inc., a Direct Energy® company, about the possibility of becoming a One Hour® franchisee. “I spent about a year checking into them and doing my due diligence,” he says. He first became aware of Direct Energy through a promotion it was running with smart thermostats. He had been looking into what the technology was all about and whether or not to provide it to his customer base. “About two weeks later, I had a voicemail on my phone from someone at Clockwork,” Baumann says. “I called back and wound up talking at length with them about a franchise opportunity.” After several phone conversations, Baumann flew to Clockwork’s headquarters to learn more. A year later, he flew back to sign the papers and become a One Hour franchisee. HVACR Business spoke with Baumann about the challenges and advantages of becoming a One Hour franchisee.

What were your concerns with becoming a franchisee? AAA Northgate was a strong local brand and had been for many, many years. When you have that kind of brand equity in the market, you get nervous about eliminating that. For the longest time, all of our vans and work trucks were red, and the business was branded on “We’re the guys in red trucks, and we can get to you quickest.”

HVACR BUSINESS MARCH 2018

Franchisee, One Hour Heating & Air Conditioning East Peoria, Ill.

FOLLOW UP: Looking to reduce day-to-day stress and become part of something bigger? Perhaps you want to be able to spend more time with your family or even increase purchasing power with manufacturers. Learn how the Clockwork family of brands can help. Visit clockworkfranchise.com or call 866-370-8302.

BUSINESS INSIGHTS: Franchising is brought to you by Clockwork, Inc. — A Direct Energy company

We’d built all that brand equity on being the guys with red trucks, but all of a sudden we were turning them yellow. It was a big struggle for me, wondering how our customers would react.

How did you communicate that change? We took that opportunity to do a conversion ad campaign. We sent out conversion letters to our customers that addressed some of the changes. We also did a pretty heavy radio campaign, where I said, “Everybody on the street is always asking me, ‘Chris, why on earth would you switch from red trucks to yellow trucks after all these years?’ And the answer is simple. It’s to serve you better.” I then listed the things that the One Hour franchise brings to the table that I can now offer because we went to yellow trucks.

What was the deciding factor that convinced you to go with the One Hour franchise? The one thing that really pushed me over the edge was One Hour’s involvement in being on the cutting edge of technology. I saw some of the controls they were working on. I saw these franchises working on these controls and their vision for the future. That kind of technological disruption is going to happen; it’s simply a matter of who’s going to do it and when. That was the biggest thing for me is to be aligned with the franchise brand.

What was another big benefit? They’ve got unmatched training. I had no training before and now I have access to online training classes and I recently sent my service manager down to St. Louis for a two-day class on leadership. I didn’t have access to any of that before. But probably the most valuable piece in all of this —that I never really even thought of — is the ability to reach out to other franchisees. That has been invaluable to be able to pick up the phone, call somebody in a similar-sized market and say, “Hey, here’s what I’m struggling with. You’re excelling at it. What are you doing different?” And they just tell you! We’re all in this together to grow.

What’s the biggest misconception about becoming a franchisee? Most contractors feel if they become a franchisee, all of a sudden they’re going to have a boss. I want to let everybody know that when you become a franchisee, you gain a partner, not a boss. I’m a control freak and the last thing I want is someone breathing down my neck. Now that I’ve been with Clockwork a year and a half as a One Hour franchisee, I find myself reaching out to my franchise business consultant when I need something, otherwise, he’s basically said, “I’m going to leave you alone and let you do what you do best and that’s run a business.” u

www.hvacrbusiness.com

CHRIS BAUMANN EAST PEORIA, IL Franchisee

When I considered renaming a 70-year legacy... I certainly felt uncomfortable, but when it came down to simple priorities, the chance of continual and greater success won out. Just talking to One Hour opened my eyes to options I didn’t even know were out there. You’ll see my One Hour branded trucks now, but “Winner” is the real underlying name! And it all started with just a conversation... Shouldn’t you be talking? 866.370.8302

The information presented in this advertisement is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for general information purposes only. An offer is made only through delivery of a Franchise Disclosure Document that has been registered with and approved by the appropriate agency in your state, if your state requires such registration (unless an exemption applies). If you are a resident of, or wish to acquire a franchise to be located in a state requiring registration, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. One Hour Air Conditioning Franchising, L.L.C., 12 Greenway Plaza, Suite 250, Houston, TX 77046. Call 1-866-370-8302. ©2017 Clockwork IP, LLC. All Rights Reserved.

OHH-028_HVACRBus_ChrisLegacy-10x12.indd 1

2/9/18 11:36 AM

20QUESTIONS

>> with CARLTON HARWOOD

We sat down with Carlton Harwood, vice president for Ferguson’s HVAC Business Group. Harwood discussed communication challenges, educating the industry and life lessons he learned from his mother. 1. What’s your management philosophy? My management philosophy is centered on elevating great managers to become great leaders. This means moving beyond telling people what to do and when to do it, and instead sharing the individual value and purpose each person brings to our business. I’m a strong believer in the power of servant leadership, and it’s important to selflessly support the needs of the larger team. 2. What do you view as the most important aspect of your job? It’s seeing each associate’s individual strengths and giving them the opportunities, resources and inspiration to thrive at their full potential, not just for their personal growth benefit, but also for the benefit of our Ferguson HVAC team and our larger company. 3. How do you communicate effectively to such a large organization? We have 130+ dedicated HVAC branches with more than 1,300 associates, and an additional 200 locations that sell some HVAC or hydronics products, accounting for another 500+ HVAC associates. Technology has been an effective tool for updating everyone each month on our progress, as well as for sharing and learning from our team’s successes. I also encourage all managers to keep open lines of communication with their associates. 4. What trends do you see moving forward? It’s a push for environmental sustainability, which could drive increased HVAC replacement and in turn will aid industry growth. We’re also seeing consumers taking a more active role, and they’re making educated decisions on the products and services they need. 5. What challenges will contractors face in the next few years? The shortage of skilled trade labor professionals in this industry is a common challenge. I imagine that this challenge will remain in the next few years. 6. How are you positioned to help contractors with these challenges? The shortage of skilled trade workers isn’t an easy problem to solve, but we invest in trade educational programs and encourage experienced professionals to mentor our new generation so we can work toward closing that labor gap. 7. What do you see successful contractors doing that others are not? The most successful contractors we do business with are the ones who have a heart for excellent customer service. They’re professional, courteous and if they encounter a challenge, they exhaust every possible solution for their customers. These contractors are also aware of the consumer’s ability to get information before procuring products and services.

HVACR BUSINESS MARCH 2018

8. What management practices will Ferguson help contractors improve? The contractors we serve everyday are masters in their craft. There is so much more to maintaining a prosperous business, however, than being an expert in this industry. Being savvy in key business principles is critical, and Ferguson frequently offers courses to contractors to help improve their skills in service contract sales, basic accounting and finance fundamentals. 9. What types of training do you offer contractors? We offer training classes for many of the products we sell, including equipment install and repair, installing service parts, thermostats, humidifiers and dehumidifiers. We also have training on business solutions. 10. Would you explain your philosophy on training? It’s refreshing and energizing to learn new and innovative ways of doing your job, and it’s important to offer associates professional development opportunities to help them continuously advance their skills, their careers and ultimately the business. 11. Could you tell us about Ferguson’s training programs? Ferguson has an incredibly robust training program. We have a formal HVAC Trainee program that provides an in-depth overview of products, the industry and Ferguson processes. The curriculum includes a specific set of coursework, hands-on training, warehouse and counter training, service visits and visits with manufacturers. 12. How do you promote the training in the industry? We offer online and in-branch training for our customers on equipment and on business management principles. We consider contractors our partners in this industry, and their success is our success. 13. Are you working on any specific tools to help contractors? We recognize this industry is evolving in today’s digital age. Tools that leverage technology, such as Ferguson.com, helps us grow contractors’ businesses by streamlining inventory replenishment and account management with just a few clicks.

14. Where do you see the most significant growth in your business? Based on industry trends, I expect we will see growth in commercial and residential new construction, and our eCommerce will continue to expand as well. 15. What are the challenges facing wholesaler/ distributors today? One challenge that may affect distributors is the potential increase in interest rates. Higher rates may impact construction activity as well as home affordability, resulting in lower demand for our products than normal. 16. What does the future hold for HVACR distributors in general? The future is bright for HVACR distributors. The distribution and wholesale market is healthy, and we are expecting to operate in a stable and growing economy. There is a rapidly evolving competitive landscape, and I’m excited about the new opportunities it provides. 17. How did you get your start in HVACR? My stepfather had an electrical contracting business that did a fair amount of building automation controls and occasionally HVACR work. On school breaks and on weekends, I worked with him, and back in those days, Ferguson sold electrical products in Virginia. My stepfather held Ferguson in high regard, telling me that they were a professional, reputable company. He introduced me to some associates in Virginia, and in 1988, I was privileged to join Ferguson’s training program. 18. What’s your proudest achievement so far? Ferguson considers the HVACR business one of its top growth opportunities, so when I was honored with the opportunity to lead this business group and our talented associates last year, it was one my career highlights. 19. How do you measure success? Outside of the obvious — success by achieving our financial goals — I measure success based on the personal and professional growth of associates. Investing in our talent is incredibly important to the company and me. 20. Who has been your biggest role model? My biggest role model has always been my mom. She was the most selfless person I ever knew, and she held all of the qualities of the person I want to be, both personally and professionally. She was a lifelong educator and a lifelong learner, taking college classes up until her early 70s. A person of integrity, she always expected me to do the “right” things and give nothing short of my best. She demonstrated the importance of upholding commitments made to us and to others. True leadership is about helping and putting others first.

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