Back in the fall of 2008, Roger and Donald Costner, co-owners of Brothers Air, Heat and Plumbing in Rock Hill, S.C., knew their heating and cooling business was about to change. The banking industry was in chaos, the housing bubble had burst, and over the next few months, they saw their business drop 30 percent.

But within a year and a half, Brothers was ready to expand. In February 2010, the contractor broke ground on a new 9,000-square-foot addition to its corporate office and started hiring technicians, customer service representatives, salesmen, and dispatchers. The secret to the Costners’ total turnaround lies in their strategic cost cuts, emphasis on customer service, and drive to expand services.

SMART STRATEGY

As Brothers’ business began dropping, the management team’s weekly meetings went from two hours to four. Tough decisions had to be made.

“We looked and analyzed every part of our operation,” Roger Costner said. Starting with overhead, the team reviewed every item on Brothers’ chart of accounts. They asked the question: “How can we reduce this line-item cost, or more importantly, is it vital to how we serve our customers?” Items that could not be tied to customer service were eliminated.

“We tightened our belts really good,” Costner said, noting that the reduction in overhead included everything from using cheaper paper for the copy machine to cutting marketing pieces that weren’t getting a good return.

Next up were the hard decisions on personnel cuts. “We had great employees and knew this would be the toughest part of reducing nonproductive overhead,” Costner said. All personnel decisions were made strictly from a business perspective by determining whether each employee’s job was adding to the company or costing the company. Although Costner admitted it was stressful, he laid off 13 of his 70 employees.

The management team decided to make all of the layoffs and permanent position reductions at the same time. That action was intended to give confidence to employees that all remaining jobs were safe.

CUSTOMER SERVICE SURVEY

With overhead reduced and nonproductive positions eliminated, Brothers’ management set out to retrain every employee and provide exemplary customer service. In this new economy, clients were demanding the best service experience, and Brothers needed to find out what customers were seeking.

“We paid attention to what our customers were telling us,” Costner said. After the banking collapse, Costner said, customers began looking for the best value in all of the services that Brothers had to offer.

One helpful tool in determining how to meet client needs was provided by Nexstar, a national best practice group Brothers belongs to. Nexstar surveyed Brothers’ customers to identify what the contractor’s clients wanted in a service company and how Brothers scored in relation to these items.

“We always considered our company to be one of the best when it came to customer service. The survey showed us al-though we were doing a good job, we were not doing a great job. Our goal is to be great, not good,” Costner said.

After reviewing the survey results, the management team developed an action plan to teach employees what mattered most to their clients. Costner said, “The No. 1 thing customers told us is they want us to be on time. We thought we were doing a good job, but we really made a point now with this.”

Brothers decided to train everyone in the entire company on how to provide better service. According to Costner, no item is left to chance. So Brothers’ employees were trained to serve customers from the time the phone rings until the job is complete at their home.

Customer service reps were taught the value of each and every phone call. Dispatchers were taught the importance and value of a client’s time, and the importance of having each technician arrive when promised. Technicians were taught respect for the customer’s home and the importance of making sure the client understands the value of each repair.

After each job is complete, every Brothers’ customer receives a “happy call.” This follow-up service gives the contractor a chance to ask questions about the client’s experience with the company, as well as gauge the client’s level of satisfaction with the service.

ADDING SERVICES

The final piece to the puzzle was to find other areas in which Brothers could serve its clients. After compiling and reviewing numerous proposals, the management team identified plumbing and sewer repair as the No. 1 service it could expand to offer its customer base. Although Brothers had been licensed plumbers for 10 years, the contractor had concentrated on heating and cooling as its main business line.

In the spring of 2009, Brothers Air, Heat, and Plumbing rolled out its plumbing division with three plumbers. Donald Costner is managing this department, which quickly grew to eight full-time plumbers, with job openings for two more.

With the addition of plumbing and sewer repair, Brothers continued down the list. No. 2 on the list was a maintenance department to complement its repair technicians. This was followed by No. 3, a professional sales department.

The maintenance department has two full-time technicians whose main jobs are cleaning and restoring efficiency to existing units. There are job openings for three more as qualified employees can be found. The professional sales department now has a sales manager and four salesmen.

And the addition of these two departments has created a need for even more employees. Costner noted that the company has hired 24 people so far, and still has openings for a dispatcher, two more plumbers, and three more maintenance technicians.

The additional services and personnel training appear to be paying off. Brothers was recently awarded several awards for customer service and satisfaction, including the Herald Buzzie award as best heating and cooling company, Best of Charlotte.com, Angie’s List Super Service award 2009, and the prestigious Consumers Choice Award (CCA) 2010. The CCA is an award that is determined by an independent third-party survey of homeowners in the area. Brothers has also made the Inc. 5000 list twice, as one of America’s fastest growing private companies. Costner said, “While it’s an honor to make the Inc. 5000 list, the consumer awards are the ones that really count. We get a ton of good, positive comments back from customers who will send us a note or an e-mail, and we read them at our weekly meetings.”

He added, “Our business is back on track, and we project 2010 to be our best year ever. Sales are expected to be up 28 percent over 2009, which ended 17 percent down from 2008.”

Publication date: 05/17/2010