I recently received a cry for help from the wife of an HVAC contractor. I will highlight certain statements reflecting her feelings and the actual condition of many contractors and their families in the PHC industry, as well as my thoughts.
She writes: “My husband and I took over his parent's 40-year-old HVAC business. Our business has always been located in the same place, but our service area is increasing drastically, quickly. Our business has taken off like gangbusters, only because my husband is a little more social and is now the salesman and has more connections. We are struggling financially, however. There is no such thing as quitting time.”
And there lies their problem. If the couple’s business has “taken off like gangbusters” as she describes, the reason they are struggling financially is as obvious as the cold of winter or heat of summer. They are implementing flawed business practices.
One of those practices is charging prices that do not allow them to recover their true operational costs, let alone earn the reward they deserve for the delivery of excellence to those who patronize their business.
Her claim that “our service area is increasing drastically, quickly” reminds me of an old adage, “Don’t bite off more than you can chew.” It’s another bad business protocol.
She goes on to state: “Our employees consist of my husband, I do our bookwork, our two sheet metal boys and my nephew, who just graduated high school. We could definitely grow, but can't afford the added expense of another employee.”
This statement proves their business protocols and selling prices are flawed. If their business “has taken off like gangbusters” and they charged properly profitable rates, they would have the money to “afford the added expense of another employee.” But since they are struggling, the proof is obviously in the pudding. Those protocols and prices are the root cause of their financial situation as well as the grief, stress and frustration she is encountering.
“We never pay ourselves. Can't afford health insurance,” she states. Those statements just serve to further prove the managerial practices they are employing are inane.
She continues: “My major disagreement with my husband is he doesn't believe in getting a down payment for major installs beforehand. He thinks payment should be made after the work is completed. We are known for getting to our customers and finishing their jobs immediately, with the best quality money can buy. However, if they buy a unit that costs us $8,000, we have to come up with that money before it is installed.
“I think there should be some sort of down payment that would cover the cost of the unit. My husband is dead set against this because his dad never did that. [It] is why we have $80,000 worth of very beautiful and almost new units setting outside, ruining as we speak because a major chain store never paid, then left town.”
To that I say: When you buy a new car or truck, the dealer asks for a down payment. When a tenant rents property, they pay at least one month’s rent and a security deposit before they occupy the space. When you buy a hamburger at a fast-food restaurant, you pay for the hamburger before you get to eat it. Why? Because it’s a smart business practice.
The fact that the dad never took a down payment doesn’t make it smart. The fact that they are now sitting on $80,000 worth of aging and rusting units shows why they don’t have the money to add a new employee. As the old saying goes, “Insanity is doing the same thing over and over again and expecting different results.”
She closes her correspondence, stating: “I guess our major disagreement right now is pricing. Also, I need help finding a credit service to refer customers to so they can finance their work. That could help us tremendously. [Any] help that you could give me would be very much appreciated!”
That last statement brings us back to the first reason I stated for her frustration and cry for help. They are implementing flawed business practices. One of those practices is charging prices that do not allow them to recover their actual operational costs, let alone earn the reward they deserve above those costs.
Don’t turn away from help
When I got this correspondence, I called her to discuss her request. The phone was answered by voicemail. I left her a message. She responded with an email saying she would call me the next day. When she didn’t call, I sent her an email.
I would love to tell you that she contacted me to discuss how I could help her. But I can’t. That’s the sad point of this column. She is intelligent enough to know she needs help. She cried out for help. But for some reason, she hasn’t pursued a path allowing her and her husband to attain the goals for which they are in business.
Her actions remind me of an anecdotal yarn I heard. A man was at his home when a torrential rainstorm made for dangerous conditions. The mayor of the town decided to call an emergency evacuation of his area. The man prayed to God to keep him safe during the storm. He was sure the storm would soon blow away, so he stayed in his home.
The water kept rising until it reached the first floor of his home. The man continued to pray to God to keep him safe. Because the water was so high, the mayor sent volunteers in boats to look for any citizens who had not evacuated. When the boat came to his house, he told the volunteers he would be fine. God would keep him safe.
But the water kept rising. As the water began coming into his house, he ran to the second floor. And again, he prayed to God to keep him safe. But the water kept rising in the stairwell to the second floor. The man climbed into the attic of his home and prayed that God would keep him safe as the water kept rising.
When the water reached the floor of his attic, the man cut a hole in the roof and climbed onto the roof. The man sat on the roof and continued to pray. An emergency helicopter flew by and offered to pick him up. But the man, steadfast in his belief that God would allow him to stay in his house and keep him safe, refused the offer.
Eventually, the water rose to a point that swept him off the roof and into the rushing currents of the storm. The man drowned and when he met his Maker, he said, “Lord, I believed in you and prayed for your help, but you didn’t answer and you didn’t help.”
God said to the man, “Of course I answered. And I answered three times. I had the mayor call for the emergency evacuation to keep you safe. I sent the boat to take you to safety. Then, I sent the helicopter to fly you to safety. But you turned away from that help.”
I don’t purport to be God. However, I could be the mayor or the volunteer in the boat or helicopter. Maybe the woman who wrote to me will see this writing, contact me, accept the help I offer and implement the practices that can allow her and her husband to put their HVAC company on the right track.
If you need help in your business practices, don’t turn away from the help that can get you where you want to go.
First step: Realize you have a problem
Before seeking solutions to a problem, you must first realize there is a problem. Then, find solutions that afford the opportunity to resolve it. However, if you know there is a problem in your business and do not follow through with the intent to seek a remedy to solve it — then youare the problem. Similar to the man who drowned in the anecdotal yarn.
When you enter the business arena, you must realize the following:
My best wishes to the woman who asked for help and to any contractor who needs business help. Just pick up the phone and let’s talk.