March 2024 Newsletter

A Word from our President

luke 2024

by – Luke Parthemer-Fenix Heating & Cooling

Thank you so every one that made it out to our last meeting with Stoney from MABCD.  Thank you Stoney for presenting, we had a great turn out.  Next month we have Pete Albea with Nu-Calgon presenting some Energy Management ideas, IAQ updates and show us a different uses for R-290 refrigerant.  We at KCCA would love to you join us at this upcoming general meeting.

                   On a different note, Skills USA’s state competition is being held at Hutchinson Community College on April 25th.  This is a great competition for our students that are enrolled in our state HVAC programs.  The winner moves on to the National competition in Atlanta, GA.  We are in need of 1 or 2 judges to help on this day.  It is a great way to give back to our future HVAC techs.  If you have questions about the competition or are interested in helping judge please reach out to me at  316-945-4842.  I look forward to seeing everyone March 21st for the general meeting.    

Please feel free to email or call Luke at (316) 945-4842 or lukep@fenixheat.com with any concerns or questions.



February’s General Meeting

Thank you Stoney for the great information you brought to the meeting, we had 27 in attendance. Stoney was full of information about the different changes with HVAC code book 2021.  Big congratulations to Rodney Sporleder from Washer Specialties for winning $100!!!

Hope to see you @ future meetings!! All general meetings are held on the 3rd Thursday of every month except August & December.


2024 Meetings

 
March 21st             Key Refrigeration, 1hr non-code
                               @ Scotch
April 18th                WTI @ WTI
May 16th                WSU Tech @ WSU Tech
June 20th               Darrell Bogner, 1hr non-code
                               @ Scotch
 
Reminder to RSVP on website @  kccaks.com

This list is subject to change due to speakers not able to make the date we have selected for them.

Contractor Pro Homeowner Series

Homeowners, Contractors Mutually Support Maintenance Agreements

CUSTOMER EXPECTATIONS: At the bare minimum, homeowners expect HVAC maintenance agreements to include two service visits per year.

HVAC CONTRACTINGNEWSBUSINESS MANAGEMENTHVAC RESIDENTIAL MARKET

Seventy-five percent of responding homeowners agree that service agreements are important, per a Clear Seas Research study

Generally, maintenance agreements are beneficial for service providers and homeowners alike. For HVAC contractors, service agreements provide guaranteed work during shoulder seasons and an opportunity to build rapport with customers. For homeowners, these contracts ensure their comfort systems are performing optimally and typically offer priority service, among other perks, if and when a sudden breakdown occurs.

recent survey of 400 homeowners, conducted by Clear Seas Research, shows that homeowners are generally supportive of HVAC maintenance agreements. Seventy-five percent of respondents deemed service agreements important (digging deeper, 18% rated maintenance agreements as extremely important; 26%, very important; and 31% important).

HIGH IMPORTANCE: Responses to the question: How important to you is it for an HVAC company/contractor to offer a service agreement in which a technician would come out twice a year to check your equipment?

On the flip side, only 25% of respondents charted service agreements as not very important or unimportant.

Contractor Perspective

Of the 100 responding HVAC contractors, 72% said they offer maintenance agreements. For those who do, they’re often recognized as a critical part of the company’s success.

PROACTIVE APPROACH: Of the 100 responding HVAC contractors, 72% said they offer maintenance agreements.

Service agreements are the lifeblood of a residential or commercial contracting company,” said James R. Leichter, founding faculty member at EGIA’s Contractor University. “They do far more than simply fill in the slow times with tune-ups; they dramatically increase the value of your business by creating recurring revenue.”

Per the survey, 87% of homeowners are willing to pay either $100 or $200 annually for a service agreement.

This varies a bit from what contractors charge, as 8% of responding contractors charge $100 per year; 44%, $200; 29%, $300; and 19%, $400 or more.

Billy Stevens, CEO of Sera Systems Inc., a field service software company, said his company charges $99 per home.

“Our goal is to accumulate as many addresses as we can,” he said. “At $99 per home, the perception may be that I’m not trying to make a lot of money on service agreements, but I disagree with that assessment 100%. The more memberships I sell in the summer, the more opportunities I have in the winter. This approach allows us to scale our business and grow 20%-30% every year.”

Butch Welsch, owner, Welsch Heating and Cooling Co., St. Louis, said his company has offered service agreements for the last 33 years. He currently charges $250 annually per system and, to keep up with inflation, tends to increase that price by approximately 5%-10% every other year.

“We offer two payment options,” he said. “We accept payment in advance for the two visits per year and offer a monthly automatic billing on the customer’s credit card. We just recently started the second option, so we are not sure how popular it will be.”

Drew Poskon, COO for Southern Home Services, a regional consolidator and operator of home service companies, including HVAC, plumbing, and electrical, said he charges customers $199 to join the company’s One Home Comfort Club, which includes two HVAC tune-ups and one plumbing and electrical inspection annually.

“A service agreement not only covers the cost of four annual service trips but also gives steep discounts to members, providing much more than $300 in value,” he said. “Additionally, small problems are often caught early via the regularly scheduled check-ups, so members are able to proactively save on potential major system disasters.”

KITCHEN TALK: Per the survey, 87% of homeowners are willing to pay either $100 or $200 annually for an HVAC service agreement. (Courtesy of Southern Home Services)

What’s Included?

At the bare minimum, homeowners expect maintenance agreements to include two service visits per year. Eighty percent of customers also prefer for these contracts to include discounts on parts, 78% seek discounts on labor, and 77% are looking for priority service.

Most contractors oblige, baking these and other perks into their service offerings.

Welsch Heating and Cooling’s air conditioning service visits check numerous boxes, including cleaning the condenser coil, checking electrical connections, measuring refrigerant levels, and more. On the heating side, an agreement ensures techs are performing tasks such as checking voltage and amperage draws, cleaning burners, and adjusting combustion for optimum fuel efficiency. Additionally, service agreement customers receive priority service in the event of a breakdown, a 10% discount on parts and labor, and a $25 rebate annually.

“This summer, we had several days in a row when temperatures climbed above 100°F,” said Welsch. “Our service agreement customers received priority service during this heat wave, which they greatly appreciated.”

Members of Southern Home Services’ Home Comfort Club receive discounts on repair fees, waived service and after-hour fees, and member-exclusive pricing.

Stevens said Sera Systems sells memberships rather than maintenance agreements. While the service provided may be very similar to other contractors’ offerings, he said using the word “membership” opens a variety of opportunities.

“Through a membership, our customers feel as though they join our organization,” said Stevens. “Once they join, they receive discounts, quicker service, and emails informing them about our sales, etc. Notice how we’re not leading with the tuneup. When you build your service agreements around tuneups, customers expect tuneups and nothing else, leaving us with a number of zero sales tickets. Additionally, they expect tuneups to be all that will be needed to keep their systems running.

“Through our membership program, our primary promise is that we’re going to take care of you, as a customer,” continued Stevens. “If you have a problem, Sera Systems is going to be out as quickly as we possibly can to fix it.”

Billy Stevens explains how important HVAC maintenance agreements are and what homeowners are expecting.

Visits Equal Business

Maintenance agreements are open invites for technicians to enter customers’ homes, creating opportunities for upsells and service upgrades.

“In 1990, we had three service technicians who mainly ran warranty calls and zero maintenance agreements,” said Welsch. “We hired a replacement salesman, and his first recommendation was to establish a maintenance agreement program. Since then, we’ve grown to 22 service technicians and 5,000 maintenance agreements. Besides offering the benefits to the customer as shown, this program also helps ensure nearly full-time work for our service technicians.”

Southern Home Services maintains 54,000 agreements and continues to grow that number by 8% annually, which has been a catalyst

“Our CMO, Lilah Wiatr, likes to say, ‘The only real customer is a club member,’” said Poskon. “The club membership is the building block of a home services business and creates trust and connection with our customers. Whether a new client initially comes to us as an HVAC, plumbing, or electrical customer, if we can deliver a 5-star-review-worthy experience, educate, and solve their problems, they will continue to utilize our services not only for that service but will be highly likely to seek out the same ‘wow’ experience in the other services we provide.”

KEYWORDS: Contractor Pro Homeowners Serieshomeownersmaintenance agreementsmaintenance for HVACRSelling HVACR equipment & servicesservice contractors


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risk management corner

When it comes to hiring new employees, you want the best to represent your company and work with your current team. Knowing that a poor hiring decision can result in costly replacement expenses, strain on management, and diminished morale among current employees, it’s important to thoroughly vet new hires to ensure they are the right fit for your business.

In addition, stressing the importance of maintaining a work culture based on safety and risk management right off the bat can help your new hire know what is expected of them.

The following tips might benefit you when it comes time to hire someone new:

Find the right fit for the job.

Your hiring decision can have a ripple effect on your company and its employees. Take time to find a person who understands the value that safety, risk management, and teamwork have within your business, and who is willing to comply with your company policies.

Make sure your job description is clear.

When creating a job description, fully list out necessary criteria, and note all job responsibilities. This will help your new hire gain a clearer understanding of what is expected in their day-to-day work. It can be helpful to explain your company’s stance on workplace safety right away, and provide general information about the training they can anticipate down the road.

Conduct a background check and check references.

Where applicable by law, conducting background checks and contacting references can give you great insight into your potential new hire. Their past experiences can provide feedback into the kind of employee they are and offer insight into how they might work with the rest of your team.

While there’s no guaranteed way to avoid making a poor hiring choice, you can do a lot to help your business by taking the extra steps to find the right match. To learn more about hiring practices, reach out to your local Federated® marketing representative today.