Why a technician chooses to pull out a manometer to peer into a system’s performance is something I think about every day. This extra effort works like a key that unlocks unseen opportunities to solve problems, delight customers, and earn handsome financial rewards.
Let’s take a look at four reasons why you may choose to grow a healthy company culture that tests and diagnoses your customer’s HVAC system performance. We’ll also look at the value a system upgrade brings to your customers and the beef it adds to your bottom line.
Deliver Valuable Solutions Others Can’t
Air conditioning systems have been around more than 100 years. Fortunately for us, only a handful of people are aware of how poorly installed air conditioning and heating systems perform. The opportunity to harvest this work is ever increasing as equipment efficiency continues to improve, while installed system efficiency continues to decline.
Fortunately, the family of NCI professionals is among the few who are qualified and able to discover and improve installed system efficiency. The fact is, everyone everywhere needs this service and it’s invisible to your competitors.
These solutions earn far higher margins than service or installation rates if you develop the confidence to offer them for what they’re worth to your customers.
Henry Ford had a boiler problem and factory production screeched to a halt. He called Nikola Tesla for help. Tesla arrived, diagnosed the problem and placed an X on the boiler. He smacked it with a hammer and the factory geared back up. Tesla sent Ford an invoice for $10,000. Ford, surprised at the cost for the short service visit, asked him to detail the invoice. Tesla wrote, ‘Use of the hammer, $1. Knowing where to strike with the hammer, $9,999.’
When you build a company culture that tests, diagnoses, and upgrades HVAC system performance, your company moves from offering labor to delivering professional services. Your superior knowledge and skill
Check out this article for the basics of adding Performance-Based Contracting to your business.
HVAC Systems Don’t Have Speedometers
Say you buy a new car, which you’re confident can drive down the highway at 70 miles per hour all day. You take it on the road and find everyone’s passing you while your pedal is to the metal. You read the speedometer and see the car will only go 35 mph. Of course, you’d head straight back to the dealership and get your money back.
An air conditioning system has no speedometer, and you can’t see other systems passing you on the road. Its performance is invisible and unknown, except for a few bothersome annoyances your customers have complained about for years without receiving a solution.
When a technician uses a combustion analyzer or another test instrument, it acts as a speedometer making system performance problems visible to the technician. At that moment, your company enters a market without competition. You earned the right to be paid what you’re worth. The value solutions can bring in two to four times the hourly labor rates you typically earn. The work is thoughtful and challenging, which means you will begin to employ sharp minds, not just strong arms and backs.
And yes, someday, you’ll use your mad skills to actually install speedometers on the systems you build, upgrade, and service. Your customer’s system performance will appear on your dispatcher’s dashboard to identify breakdowns and predict performance improving repairs round the clock.
Why Recruit, Elevate, and Retain Technicians?
Recent discussions with owners of Performance-Based Contracting’ companies revealed the key to their success is training and enlisting technicians to test, diagnose, and upgrade poorly performing HVAC systems.
With the support and leadership of company management, technicians are the front line. Remember, this work begins when the certified technician pulls out his or her test instruments to peer into a system’s performance.
Successful performance-based contractors agree the company must be fully committed to training technicians and others in the company. This creates knowledgeable team members and an elevated culture where testing, diagnostics, and system upgrades thrive. Technicians can’t help but test when immersed in such a culture.
Engaged technicians quickly understand the mission of performance. They have danced around it every day of their careers but had no speedometer or a target. They have been unable to properly measure or improve installed system performance.
Performance-Based Contractors report trained technicians are more engaged in their jobs and that creates stronger company loyalty. As confidence grows, their ability to explain and sell more services to their customers skyrockets. Your customers love being educated by a technician.
As recruiting new techs is becoming critical in our industry today, training and having a high-performance mission becomes a magnet for new talent. This is true inside and outside the industry. Trained techs love contributing to a cause. They like “belonging” and motivate themselves to improve and help others improve.
Techs take great pride in knowing they are among the best in the country. They often consider their certification in the tenets of Performance-Based Contracting’ as the highest professional credential they can earn. The very nature of their jobs changes when they find hidden problems, upgrade performance and then verify they delivered what they promised to their customers.
Why Delivering a Unique Product is So Important
Imagine a product that your company creates from scratch that every customer needs and wants. This product is system-improving performance upgrades. You specify it, design it, build it, and then verify it delivers the promised results. You keep nearly 80% of every dollar earned by this product and the cash remains in your company. Often, less than 10% of the job cost is paid out to a manufacturer.
You set the system upgrade value without competition because every system-performance upgrade is a custom project. This product often increases system performance by more than 35%. What’s that worth and what other product can top those results?
Beef to the bottom line is earned by adding $2000 to $4000 system upgrades, with a 50% to 70% gross profit to most of your equipment changeouts. There are zero advertising costs and the expense of job mobilization is already covered in the equipment installation cost.
Here’s one more article to read on Why System Performance Measurement Works.
Before your company can sell and earn the high net profit that system upgrades deliver, first you must possess the ability to deliver the goods to your customers. Which is why each year NCI improves its ability to support and help you build the culture of testing, diagnostics, and upgrading system performance into your company or career.