< Previous20 OCTOBER 2018HIGH PERFORMANCE HVAC TODAYfirst lesson, then wishing you good luck as he walks away from the plane. There’s bound to be something you’ll forget, or something you’ll run into for the very first time, when you begin testing system performance.You will make some mistakes, that’s just part of “HVAC Performance Puberty.” But nobody likes to crash and burn. This reality hit us many years ago. We noticed some contractors were able to fly solo right from the start, while many others struggled for years to make system diag-nostics work in their companies. We realized someone had to support them when they hit bumps in the road.Today you don’t have to go it alone. There is now a comprehensive support structure de-signed specifically for Performance-Based Con-tractors. In 2002 National Comfort Institute (NCI) founded its membership group specifical-ly for this purpose.If you’re serious about becoming Perfor-mance-Based, NCI member-ship can reduce a huge part of the learning curve for you. In addition to unlimited techni-cal support, you’ll have access to thousands of pages of techni-cal materials, marketing pieces and ideas, sales materials, inter-nal training lessons, hundreds of articles and tips, a growing knowledge base of frequent-ly asked questions, member fo-rums where you can seek advice from hundreds of other mem-bers, and much more.NCI membership can help take the fear and the sting out of In this fourth part of our ongoing series, we will explore the last five of 10 distinct steps that will help you on your path to embrac-ing High-Performance HVAC – should you choose to accept this mission.It’s important to understand that anyone can become Performance-Based – it’s not an exclu-sive club designed to keep people out. As the say-ing goes, the “rising tide raises all ships.” The more contractors doing this, the better it is for everyone – especially your customers!Let’s take a closer look at each of these steps on the road to High-Performance:STEP 6 – HAVE SOMEONE WATCH YOUR BACKThere’s nothing scarier than learning some-thing new and unfamiliar and having no one to fall back on when you hit a snag or something you don’t understand. It’s like a flight instruc-tor putting you in the pilot’s seat right after your Five More Steps To Becoming A Performance-Based ContractorBy Dominick Guarino, PublisherMANAGEMENT The ABCs of High-Performance HVAC Contracting: PART 4OCTOBER 2018 21HVACTODAY.COMladder are shown above.While you can take some of the steps out of order, it’s best to start with the first step and work your way up. The learning ladder applies to vir-tually anyone in your company who is involved in field work, including service technicians, installers, and sales people. It also applies to your management team. The people at the top need to know exactly what your frontline people are learning and im-plementing. In addition to the train-ing described in these steps, there is plenty of online training your team can access to get everyone on the same page – including operations, customer service, dispatch, etc.Many of the articles in this series refer to specific processes, charts, procedures, products, and services provided exclusively through NCI. Whenever possible, I will mention other sources, but because so many of the processes and approaches were created by NCI, it’s often impossible to offer alternate resources. I hope this doesn’t deter you from follow-ing the advice in this series. These articles are based on decades of ex-perience, research, testing, and de-velopment from which you’ll benefit -- regardless of where you get your education and training.STEP 8 – GET EVERYONE ON BOARDThe next step is to get your employ-ees on board. It starts with getting them trained and certified in the disciplines described above. If you have 10 em-ployees or more, it might make sense to bring the training onsite with private classes for your company. An addition-al benefit of onsite training is that your techs can spend more time in the field with the instructor, both before and af-ter the classroom training. going it alone. While there are some great business coaches out there to help with some of the manage-ment aspects of the culture change High-Performance Contracting de-mands, there is no other place, to my knowledge, that approaches the spe-cialized support you get from NCI.Learn about all NCI member bene-fits and programs by going to: www.ncimembership.com. STEP 7 – BABY STEPSNCI has put together a learning lad-der designed to help residential con-tractors and their employees with a step-by-step approach to their ongoing education. We also have a very similar commercial contractor learning lad-der which we will share in a future arti-cle. Each of the educational steps of the Catch up on all the installments of this series:Part 1: What is High-Performance HVAC and Why Do It? ncilink.com/ABCs-1Part 2: Is It the Right Fit for Your Company? ncilink.com/ABCs-2Part 3: Five Steps for Becoming A Performance-Based Contractor. ncilink.com/ABCs-3Residential Learning Laddern High Performance Implementation Bootcamp: Build a culture and processes that bring it all togethern Performance-Based Selling: Learn to guide customers through buying High Performancen Residential System Performance: Advanced Diagnostics and Delivered BTUs to maximize performancen Residential Air Balancing: Once you have the right Airflow, balance for optimum comfort and efficiencyn Carbon Monoxide & Combustion Efficiency: Tune equipment to deliver maximum BTUs and CO Safetyn Refrigerant-Side Performance: Learn the true relationships between air-flow and refrigerant charge and properly test and adjust the total system for maximum performancen Duct System Optimization: Start with the basics of Static Pressure, Airflow, and Air Distribution upgrades22 OCTOBER 2018HIGH PERFORMANCE HVAC TODAYMANAGEMENTSTEP 9 – UPDATE YOUR INTERNAL SYSTEMS AND RETHINK YOUR PERSONNEL NEEDSOnce you begin implementing High Performance at all levels of your company, re-evaluate some of your systems to make sure they can work with the new approach. You may need to modify your service pro-cedures, forms, invoices, and service agreements to reflect the changes and capture important new infor-mation about customers’ systems. As you roll things out, you may want to make some changes in your hir-ing practices, installation methods, compensation methods, and other key cultural elements of your busi-ness.As you begin to grow the sys-tem renovation side of your Perfor-mance-Based company, you’ll soon identify the need for specialists with-in your organization in two areas: Air Diagnostic and Balancing Special-ists, and Duct Renovation Specialists. You’ll quickly notice with these posi-tions that your materials-to-labor ra-tio is significantly different than it is on equipment replacement and de-mand service.Simply put, renovation work and Air Upgrades usually involve a high-er ratio of direct labor to materials than when installing new equipment. This is one reason you need a more aggressive labor factor. You should price this labor higher to achieve higher contribution profit, making up for the fact that you’re not reselling a high-ticket item. Of course, if you are replacing equipment, which will happen of-ten, price the different types of work separately and then combine them big, flashy rollout. It’s best to un-der-promise and over-perform when it comes to a culture change. Taking baby steps is always best. Share where you want to go and each of the steps you plan to take to get there. Everyone will want to know how it will affect them, whether they tell you or not. Fear is usually one of the first reactions to change. Spend time with each person on your team, answering any questions they may have, especially about how their job will be affected. Will it be more work? Do they have an opportunity to advance themselves, to improve their careers, their financial situa-tions? How far out of their comfort zone and expertise will they need to go? These are just a few of the ques-tions you can expect. Try to address their questions proactively, even be-fore they ask.If you have fewer than 10 employ-ees, it might make sense to travel to a regularly scheduled class, or may-be get together with another com-pany to share onsite training. If you don’t have a lot of field personnel, you may need to send them to train-ing a few at a time, so as not to dis-rupt your business. Once your peo-ple see you are serious about the change and begin to understand how different Performance-Based Contracting (PBC) is, you’ll find your company evolving into some-thing very different. An important part of getting ev-eryone in your company on board is to share your vision of how High Performance will impact them in a positive way. Be sure to include your game plan. There’s no need to make a huge fanfare about it. A qui-et thought-out meeting with the en-tire team will do far better than a OCTOBER 2018 23HVACTODAY.COM“around to it,” Figure 1 is my gift to you: your very own Round “TUIT.”A journey of a thou-sand miles begins with the very first step. If you want to reap the benefits of High-Performance Contract-ing, you must take that first step, no matter how big or small.The good news is it’s much easier and less scary than it was five or 10 years ago. Many pioneers have walked these steps before you, scraping their knees and pulling arrows out of their backs along the way. While it’s no longer the Wild West, the path to performance is still some-what of a gravel road. By getting on that path today, you’ll be many miles ahead of those who will be driving down its four-lane highway in the years ahead.In future articles in this series we will break down many of the 10 Steps to High-Performance Contract-ing in much more detail. In the mean-time, start digging deeper. If you’ve been holding back exploring this ap-proach to your business, spend some time to learn more. This magazine has numerous arti-cles on the topic. Take some time to go through past issues. Also, NCI’s website is jam-packed with informa-tion – available to you at no cost, to get you started on your path to High Performance. STEP 10 – JUST DO IT!There is much truth and wisdom to this catchy marketing slo-gan from a well-known athletic shoe manufacturer.Procrastination is the number one barrier to any major change. It’s the number one reason contrac-tors who consider becoming Perfor-mance-Based never quite get things off the ground. “We’re too busy right now, but when we get around to it, we’ll get started.” Or, “Just as soon as I fix _________________ (fill in the blank), I’m going to get going on this.”These procrastination statements are just a few of dozens we’ve heard in putting off getting started. Many contractors who put it off year af-ter year with these very excuses lat-er told us they could kick themselves for losing two, three, or more years they’ll never get back. So, for all those folks who said they would start just as soon as they got in your proposal. The result will be a higher gross margin on the overall job. An important factor is to make sure you’re pricing your renovation work based on what it’s worth and your investment in the tools and ed-ucation, not just a marked-up labor rate. More on this in future articles in this series.One important factor to consider is when you hire and train duct renova-tion specialists, you don’t need to nec-essarily pull from the existing skilled labor pool of service technicians and installers. After all, these specialists won’t be dealing with refrigerants, equipment diagnostics and repair, electrical, or controls. With the prop-er training, an individual with good mechanical aptitude and great people skills can be trained to measure sys-tem performance, perform a final test and balance and/or do duct renova-tions and repairs.The beauty of this approach is it al-lows you to pull from a much larg-er pool in this tough labor market. Since these roles require fewer skills, and less formal education, your hourly labor costs can be significant-ly lower.Dominick Guarino is publisher of HVAC Today magazine and CEO of National Comfort Institute, Inc. He can be reached at domg@ncihvac.comFigure 124 OCTOBER 2018HIGH PERFORMANCE HVAC TODAYHave you ever run a call where the customer opened the door and instructed you to go around the house to look at the condenser? Did you arrive on time and another con-tractor was there? Do you start your call by explain-ing your process and they tell you they only have 20 minutes?You have likely had these situations and worse. Some companies have sales call no-shows of up 5% on all of their leads. If their lead cost is $300, and the salesman runs 400 leads a year, that means 20 weren’t home, costing the company $6,000 net profit. Even worse, those 20 leads, properly set, with a 50% close rate and $8,000 average sale, meant a compa-ny had an opportunity cost of $80,000 in lost sales or $30-40,000 in lost gross profit dollars. This example is for only one salesperson. Let’s not forget how the salesperson is affected. No show customers impact the salesperson’s drive time, customer calling time, office calling time, wait-around time and so on. This is very frustrating. The lost commissions, well, that’s not a good story either.THE IMPORTANCE OF SETTING APPOINTMENTS PROPERLYNo-shows are part of the story. Even more im-portant is how all appointments are set. Making ap-pointments in the right manner has the potential to improve the close rate and job selling prices. Think about this: by improving close rates by 5% and aver-age job prices by only $1,000 on 400 leads, you can increase annual sales by $300,000. To do that the salesperson must take more time and conduct a more professional call, showing customers what is substandard in their system and explaining the negative impact of not addressing fundamental design and/or installation problems. When the customer ser-vice representative (CSR) sets the stage for this kind Setting Both the Appointmentand Your Customers’ ExpectationsBy Tom PiscitelliSALESSETTING THE APPOINTMENT IS AN OPPORTUNITY TO SET YOUR CUSTOMERS’ EXPECTATIONS FOR HOW YOU WOULD LIKE THEM TO BE ENGAGED IN THE CALL PROCESS. IT CAN SEPARATE YOU FROM OTHER CONTRACTORS EVEN BEFORE THE CALL IS MADE.OCTOBER 2018 25HVACTODAY.COMHere’s a sample script of how this might be done:SAMPLE SCRIPT 1CSR: Good Morning, thank you for calling Our Company, my name is ___, how may I help you today?Customer: I’d like to have someone come out and give me an estimate for a new furnace/air conditioner/heat pump/boiler/water heater.CSR: Great. I’ll be glad to help you. Let me gather your information and then I have a few questions for you so our comfort advisor will be prepared. This will take about 10 minutes, is that okay?So, may I begin with your address, please? (The CSR gathers the custom-er’s information)CSR: May I ask if you have ever re-placed your furnace or air condition-er before?CSR: Okay, thanks, may I ask why you’ve decided to replace your system now?SAMPLE SCRIPT 2CSR: What time frame did you have in mind for completing this project?CSR: If you have just a few more minutes, I’d appreciate the oppor-tunity to describe what our in-home consultative process will be.CSR: Our technician will start by asking you some questions, then ask you permission to do a brief survey of your home. During that time, he’ll take some measurements to deter-mine if your ductwork has adequate capacity and you have properly sized equipment. After that, he will be pre-pared to show you some options to consider. All this will take from 60-90 minutes depending on your ques-tions. He’ll stay as long as you wish.CSR: I have an opening ______ or ________. Would one of those dates be good for you (both) or should we find another time?In these examples we established some important things:t The CSR asked permission to gath-er important informationt We know if they have ever had a system replaced t We know why this is important now … or not so urgent if that is the caset The customer now expects the salesperson to inspect the ductwork as well as the equipmentt We set an expectation for a 60-90 minute or longer call.Contrast this with how your appoint-ments are currently set. I’m pretty sure there isn’t much more discussed other than picking a convenient time. If that’s the case, then you are just like everyone else coming out to give a bid, estimate, or quote. Yuk.ONE-LEGGER VS. TWO-LEGGER APPOINTMENTSFor those new to sales, these terms refer to calls where the potential cus-tomer is either one person in a couple or both. A “couple” can be husband and wife, single-parent and friend, daughter-homeowner and father, or any combination of decision-makers of call, the salesperson is more likely to have receptive customers.Setting the appointment is typical-ly something that is not prescribed or managed by the owners. It’s well worth the time it takes to get this done and to make sure it continues to get done. Let’s take a look at how you can improve the level and quality of cus-tomer engagement on every call to produce more sales.FIRST, DECIDE WHAT YOUR IN-HOME SALES CALL PROCESS ISIf you don’t have a written pro-cess,you need to create one or your CSR can’t explain it to your custom-ers. See my July article for details (ncilink.com/SalesProcess).What Do You Want Your CSR’s to Say? What is said, when it is said, and how it is said are all important. I’ve made many ride-along coaching calls where the homeowner was clearly surprised at what the salesperson said they were going to do and responded defensively, suspecting the salesperson had some alternative agenda.The owner, salesperson, and every-one who sets the appointment should be involved in the appointment-set-ting plan. I’m a proponent of scripting things like this because various people might be setting the appointment and new people will need to be trained. 26 OCTOBER 2018HIGH PERFORMANCE HVAC TODAYSALESpare some options for you to consid-er. All of that will take 60-90 minutes. Does that sound right to you?This final statement essentially re-peats what was said earlier, intending to reinforce the salesperson’s activi-ties and the customer’s time commit-ment. Often, when this is well done, the customer will be impressed with your professionalism and decide not to call other contractors. At the least, if they do call others, your appoint-ment-setting call will stand above the others in many positive ways.FINALLY, THE EMAIL CONFIRMATIONThese days, most of us are accus-tomed to email notices, remind-ers, and calendar invites. Your CSR should offer to send an email confir-mation. Customers appreciate that. In the email, include the same language we’ve already discussed, along with some information about and a photo of the salesperson. Setting the appointment is the first part of the sales process and it rep-resents an important opportunity to differentiate your company before your salesperson even knocks on the customer’s door. ly designed or installed. Usually, the equipment is oversized, shortening its life. Or the ductwork is inadequate or too leaky causing higher energy bills. There are often hot and cold spots in the home as well as health issues for the family and more. This is a big decision that impacts your entire family. Once you invest, the system typi-cally lasts 15 or 20 years, so you live with it for a long time. Is there any-one you might want to invite to join you who may also have questions?The final question, “Is there any-one else you might want to invite…”, following an explanation of the rea-son for it, will be heard by the custom-er who isn’t so confident in his or her ability to gather the information need-ed to make the decision. I’d encourage you to consider scripting this language and coaching your CSR’s to say it ver-batim. It works.CONFIRMATION AND AGREEMENTThis appointment setting process can take up to 10 minutes if customers are willing, or less if they’re not. Ei-ther way, the CSR should summarize what was agreed to with an emphasis on their engagement in the call. The CSR can end the call by summarizing the key points:CSR: Okay, great. So, Tom will be there this Thursday at 5:00 PM. He will ask you and anyone you might in-vite to the meeting what you want in a new system. He will survey your home with you if you can join him. Further-more, he will go into the attic or crawl space to inspect the ductwork and equipment and take some important measurements. He will then share all of this with you. After that, he will pre-and others who are counted on by the owner for input.In the past, it had been very com-mon for the CSRs to insist “both de-cision-makers be present” to schedule an appointment. This was very com-mon in many in-home sales indus-tries. The reason is clear; when both “decision-makers” are present, the likelihood of making the sale on the first call is higher. As consumers have become edu-cated to this tactic, they have pushed back. The cautious homeowner will purposefully have one person there so they can gather information on the first call and then make their decision later, without a “pushy” salesperson lingering at the kitchen table and often refusing to leave until the sale is made. Our industry is built on customer satisfaction and the resulting loyalty that produces repeat service, mainte-nance, replacement, and referral busi-ness. A single sale might be $10,000 but the lifetime revenue could be twice or three times that. If we use abrasive selling techniques to make the imme-diate sale, a negative reputation would be the result and word would spread in the community. In today’s world, where consumer ratings are so common, a single neg-ative consumer rating can have a last-ing impact on the company’s business. WHAT CAN YOU DO? As always, your CSR can simply tell the truth. Here is some language that has been time-tested, will improve your two-legger appointments, and increase your first-call close rates:CSR: Thank you. One more thing. Most folks aren’t aware that nine out of 10 existing systems are incorrect-Tom Piscitelli has more than 40 years’ experi-ence in HVAC sales, sales management, marketing, and consulting. His articles have been published in trade magazines. He often speaks at industry events, has produced three HVAC sales training DVD’s, and he particularly enjoys bringing cutting edge training approaches to our industry (www.sellingtrust.com). Tom’s most recent project has been co-authoring and publishing the book, Proposition Selling: How to Create Extraordinary Success in Business-to-Business Sales (www.propositionselling.com).OCTOBER 2018 27HVACTODAY.COMPHOTO OF THE MONTH“Drop Cheek 90 into Split Zone System” — Nate Miller, Campbell and Co., Yakima, WA Beautiful in-house fabricated 90’s on all sides for tremendous airflow. This Lennox iharmony zone system travels from the basement, up two floors to the attic, providing great airflow on all three levels of the home. The AprilAire filter provides tremendous air quality, as well as longevity to the system.Nate Miller from Campbell and Co. is the October 2018 winner of our Photo-of-the-Month contest in the “Good” category, as voted on by the subscribers to the High-Performance HVAC Today (ncilink.com/HToday) magazine and visitors to the HVACToday.com website. He will receive a $50 gift card.You can too – submissions are always welcome. If you’d like to submit a photo for consideration, go to ncilink.com/POMSubmit and fill out the information as requested.THE NOVEMBER CONTEST OPENS ON OCTOBER 8, 2018. That gives you plenty of time to submit something in any of our three categories: The Good , The Bad , WTH (What the heck).28 OCTOBER 2018HIGH PERFORMANCE HVAC TODAY What tools and instruments are im-portant and why?If you are interested in submitting an article idea, just go to hvactoday.com/contribute/. We will contact you to get the ball rolling. If your article is published, you’ll receive five FREE printed copies of the issue in which it appears.HAVE YOU SCHEDULED YOUR TRAINING YET?Your membership provides you access to some of the most cutting-edge train-ing programs from both the technical and business, sales and marketing perspectives. Right now, NCI is fully underway with its Fall Training schedule and classes are filling up fast. As members, you have the opportunity to use NCI Bucks to help offset the costs of training. If you participate in TIPP (Train-ing Incentives Partnership Program), you are earning Bucks based on the purchases you make from NCI Partner Vendors. Those Bucks are deposited into your training account. They never expire and can be used to pay for any live NCI train-ing class, online training, or conference.Click ncilink.com/bucks to learn more about them.With that in mind, now is the time to enroll into NCI’s Fall classes. Check out the NCI class schedule by going to ncil-ink.com/ClassSchedule. For more details about each class, just point your web browser to ncilink.com/train. Or you can call 1-800-633-7058 and ask to speak to a Customer Care representative.NCI WELCOMES A NEW MEMBER OF THE TEAMWe’d like you to join us in welcoming a new member to the NCI staff: Kate Kelly. Kate is our new Events Manager and she joined the staff on September 10th. You might recognize her from several years ago when she was part of the editorial staff at Contracting Business magazine and HVAC-Talk.com.Please be sure to say hello to Kate at the High-Performance Summit 2019 in Orlando, FL, April 15-18, 2019.MEMBER-ONLY MOBILE APP IS FREEAirMaxx™ is NCI’s member-only free mobile app. It is included in all Comfort-Maxx™ subscriptions. It’s available for both Android and iOS phones.AirMaxx lets you to show homeown-ers the “airflow grade” for their HVAC systems. All you need is to collect some nameplate information, then do four static pressure measurements, and input the results into the app. The app does all the calculations and produces custom-er-centric graphs and wording for you to show them. This helps customers better under-stand what is happening with their com-fort system and can help you close more duct renovation and air upgrade sales.This app doesn’t require a data plan – it is all resident right on your phone. It has a very simple and clean interface and is easy to use.For more information click this link: ncilink.com/AirMaxx.FOLLOW THE LEADERPerformance-Based Contractors are setting the pace and affecting evolu-tionary change in the HVAC Industry. As members of National Comfort Institute (NCI), YOU are the leaders and your com-petitors are being forced to play catch-up. Do you want to keep them following the leader? Then think about this: you have direct access to a great vehicle to help you get your message to the in-dustry: High-Performance HVAC Today magazine. We’re looking for writers to lend their voices to the movement. No one knows the ins and outs of implementing perfor-mance into an HVAC contracting compa-ny better than you.Typical article topics could include: How do you get your technicians on board with measuring and testing air-flow on every call? What obstacles do you face selling air upgrades and how do you overcome them? How do you price your duct renova-tion and air upgrade projects? What advantages do you have using the ComfortMaxx® software suite? Explain how you market your high-performance services and share some success stories Discuss how you recruit and train new field service and installation peopleNCI MEMBER UPDATEOCTOBER 2018 29HVACTODAY.COMAdvertiser IndexHIGH PERFORMANCEHVAC TODAY TMAD INDEXDwyer Instruments, Inc. | www.dwyer-inst.com .......................................................................2High Performance HVAC Today Magazine | HVACToday.com/subscribe ........................29Lazco Corp. | www.lazcocorp.com.................................................................................................27MyHomeComfort.org | MyHomeComfort.org ...........................................................................4TSI, Inc. | www.TSI.com/comfort .....................................................................................................5To Subscribe to High-Performance HVAC Today:ONLINE: Visit HVACToday.com/subscribe for a FREE digital subscription.PRINT: 1 year/$72; single copy $7. Canada: 1 year/$92; single copy $9. Payable in advance with U.S. funds. Prepaid subscriptions may be sent to: High-Performance HVAC Today, PO Box 147, Avon Lake, OH 44012. Phone: 440-949-1850; toll free 800-633-7058; FAX 440-949-1851, or visit HVACToday.com/subscribe to order online.PublisherDominick GuarinoEditor-in-ChiefMike WeilArt DirectorConnie ConklinOnline Development DirectorBrian RosemanSales ManagerDave KenneyCirculation ManagerAndrea Begany- GarsedEditorial AssistantMarge SmithEmail us at contactus@hvactoday.com with your comments and questions.Next >