Why HVAC Business Systems Matter
Written on: December 22, 2014 by Wendell Bedell
Wendell Bedell, CEO, GrowMyHVAC.com
Whether you are a one-person operation or a 200 truck company, you need to implement systems and procedures. Why?
Consistent Work Delivery
Today, customers demand that their expectations be met exactly the same way every time they buy a service or product. If you can’t deliver consistently, they won’t call you back. Consistency is the reason many companies follow franchise models like McDonald’s, Best Buy and Dunkin Donuts. Each of these brands’ restaurant and retail franchises has a manual of company standards and checklists to deliver consistently on each and every order. Notice how employees always ask questions like, “Would you like a pie with that?” It’s in the manual. They understand that consistently asking customers what they desire using forms for comfort, health, safety, property or savings has proven to result in increased sales. Like these franchising businesses, the best contractors increase their average repair and replacement ticket and prevent costly call-backs by using proper call handling procedures, onsite call assessment forms, pricing standards and work delivery checklists for every job they do.
Pricing & Payment Protection
Customers expect upfront repair and installation pricing. Studies have shown that the average technician is only 52% efficient over a 12 month period, leading flat rate pricing to become the only way to for a contractor to set a fair price without alienating customers. In addition, the best contractors use invoices and proposals that provide payment protection terms, as well as liability protection. The best aspect of flat rate pricing is that it provides you with pricing credibility and can help prevent competition by allowing you to quickly price and propose work on the spot.
Tracking your daily billable hours to service calls and jobs is the single best way to know what is needed to stay busy, as well as whether your next hire can be justified. Tracking also allows you to implement performance-based pay for technicians and installers and to know when pricing needs adjusting. Tracking billable hours, the number of service agreements sold and accessories/replacements sold per calls made or hours billed versus job labor budget is simple. A one-truck company can use a pocket note pad and log billable hours after each call; a company with more than one technician or installer can have them call in after a job to debrief. Most contractors know if they are profitable without having to look directly at their finances simply by tracking billable hours.
Learning Best Practices
Most HVAC business owners find it difficult to find the time to learn best practices. They are important to establish, however, in order to survive. At the very least, you should be reading Indoor Comfort or attending GrowMyHVAC.com’s free business training webinars offered through its Business Builders Club. Participate in the forums, follow a few threads, ask a few questions or simply attend.
This is the most often overlooked business system, regardless of the size of the company. HVAC business owners need to keep their employees motivated and should have systems in place for this. Performance-based pay should be integral for management, office and field staff, but how do owners themselves stay motivated? It happens to all of business owners—when we’re faced with obstacles, we can often lose our focus or drive. As an owner, you are faced with business challenges of all magnitudes on a day-to-day basis and it’s hard not to feel overwhelmed. However, being your own boss is a rewarding experience, despite the challenges. The best contractors employ these five ways to stay motivated:
- Talk to your customers
Customers provide you with feedback that will allow you to generate ideas and find more ways to improve your business.
- Get customer reviews
There is nothing more powerful to feel good about your business than when you get positive customer reviews. The best businesses ask customers at the end of each call to visit their website and write a review or visit their various social media sites to post one.
- Establish goals
Break down your business improvement goals into smaller milestones to make them more approachable and manageable. Don’t know where to start? Get a business coach. For example, GrowMyHVAC.com’s clients simply compare their business operations to our best practice business systems and then jointly prioritize, with their assigned business coach, weekly goals based on greatest to least revenue/profit gain potential and owner/staff available participation time. It is important to remain realistic about what you can accomplish.
- Reflect on your accomplishments
Always look at the big picture. Taking a look back from where you started compared to your present situation is a powerful way of knowing just how far you have come and can re-motivate yourself as to why you even started the business in the first place.
- Think about your business’s contributions
Think about your business’s impact and contributions on your customers and employees. Studies show that small businesses like yours provide at least 55% of all jobs in the U.S. Think about your business as a means for positive change for customer, company and employees alike. Your business has more impact on your local community than you realize.
Wendell Bedell is CEO of www.GrowMyHVAC.com, a division of Building Services Institute, Inc., an online HVAC staff training and process implementation support membership organization focused on helping contractors grow and become more profitable. His email is [email protected] To see what the positive financial impact is to your business by implementing the above professional service call handling blueprint, go to http://bit.ly/contractorneedsanalysisor call (800) 240-2823.