Busy Contractor Finds Way to Cut Labor Costs
April 18, 2011
BATAVIA, Ill. - State Automatic Heating & Cooling fabricates plenty of ductwork in its sheet metal shop, but when it came time for heating the shop to improve employee comfort and productivity, the owners chose a fabric air distribution system instead of spiral metal duct.
“It’s fabric over metal - literally - because the fabric duct hangs above the sheet metal production area,” said Jim Gates, president of the 81-year-old family-run business. The contractor installs, repairs, and services all makes and models of air conditioning and heating equipment, including boilers, water heaters, and geothermal systems.
“We didn’t have the time and didn’t want the expense of running metal duct, so when we heard about SimpleSox fabric duct, we jumped at the opportunity to finally heat the area properly.”
The area had been heated by an unducted, 92 percent-efficient, 2,000-cfm Carrier WeatherMaker furnace, which is still in place; it had replaced a space unit heater in a 20-foot-high balcony space. According to Gates, air distribution was drafty, uneven, and the heat didn’t adequately reach all portions of the 4,000-square-foot fabrication area (part of the company’s 5,800 square feet of fabrication, warehousing, and office space).
LONG TIME COMINGThe contractor had what many would consider an enviable problem these days: This internal project remained unfinished for three years because upper management didn’t want to pull a journeyman sheet metal worker and an assistant off of other jobs in progress.
“We’ve been busy all through this recession,” Gates said. “Geothermal’s been keeping us busy now,” with systems from WaterFurnace International and Carrier. Jobs have been coming in for both retrofit and new construction.
The company also grew a healthy backlog of business in the third and fourth quarters of 2010, from customers who were hustling to get their $1,500 American Recovery and Reinvestment Act tax credits before the year-end deadline. Employees were busy - as we said, a good thing - so the contractor needed to make some decisions on its internal project.
Gates estimated that running 54 feet of spiral metal duct (the other option) would have required eight hours of labor for two workers, plus the costs of transporting the company’s 25-foot, hand-cranked Genie lift from a project in progress. Chicago-area labor rates for two union workers average approximately $200/hour (as a billable rate), and would have cost approximately $1,600.
Installing a 54-foot run of the fabric duct took one union assistant three hours, at a billable rate of $100/hour, or a total of $300.
HOW IT WAS DONEThat one worker used a ladder to install a cable suspension system and string the ductwork down line from the furnace. The suspension system (consisting of cable, eye-hooks, and beam clamp hangers) took one hour to install.
The prep work, Gates said, consisted of opening the boxes, laying out the system, positioning the components, and zipping them together; it took an hour and a quarter.
The actual act of installing the fabric duct (stringing it along the cable line and hooking it to the furnace plenum, respectively) took 15 and 30 minutes. Gates estimated the installation savings at more than $1,300. The worker was sent back to a billable project for the majority of the day.
“It’s a sealed tube, zipped together with a zipper,” said Gates. “It’s one sock that you zip together.”
The fabric duct was also less expensive in material costs than metal, Gates said. The cost for 10 5-foot lengths of spiral duct, five couplings, eight registers, eight boots, one adaptor, one end cap, and miscellaneous hanging materials was approximately $200 more than the fabric duct system.
Its Adjustable Air Outlets (AAO), which are patented and field-adjustable air registers, come in either 8 and 4 o’clock, or 10 and 2 o’clock orifice positioning. State Automatic’s four AAO’s distribute air from both sides, so great time savings were achieved versus installing eight registers, that only distribute from one side of a metal system. The AAOs are factory-set with medium airflow, but can be field adjusted to a multitude of cfm settings by twisting the opposing AAO layers to regulate the orifices.
MORE OPPORTUNITIESSimpleSox was introduced by DuctSox to compete directly with spiral metal duct. The fabric duct is modular, easy to design, in stock, and it can be shipped at relatively low cost to a project site. Although it also has elbow components, it is designed mainly for smaller projects (under $3,000) that have straight runs, or just a few 90-degree turns.
“We could have used this concept last summer for a yoga shop in a retail strip center build-out,” said Gates, an unabashed fan. “We won the $5,000 contract against other bidders, but we could have used this to increase our profit margin, save the customer money, and completely blow away the competition, which all specified metal duct like we did.
“The client was in a hurry too, so we could have installed the air distribution system in a half day versus the four days required for metal and accessories.”
State Automatic’s business consists mainly of new luxury homes with multiple HVAC system installations. The company operates six service trucks in Chicago’s western suburbs, but also bids a handful of light commercial projects where SimpleSox will give them a competitive edge, according to Gates. They have already used their own system as a demo for several prospective clients.
They are better informed than customers of the past, but when it comes to duct repair, “I have to present it,” he said. What they want is comfort, Gates said, so “instead of duct repair, it’s more about putting the air where you want it.
“I can’t tell you how easy this was.” It gave the contractor a light bulb-over-the-head, good-idea moment that he intends to apply as often as possible. “I would bid everything that I get” with fabric duct, he said. “For an open duct run facility, it’s the way to go.”
Comfort differences have been significant. “There is more even distribution across the whole area,” Gates said. Underneath the fabric duct runs are a 10- by 4-foot layout table by Engle, with power notching and shearing capabilities; an 8-foot snap lock fabricator by Lockformer; and a variety of brakes and other sheet metal equipment.
“Fabric will never completely replace metal duct on all types of projects, but for the right applications, we now see it as a hedge to increase profit margins and help win bids,” said Gates.
For more information, visit www.simple-sox.com and www.stateautomatic.com.
Sidebar: BackgroundState Automatic Heating & Cooling is almost as old as The NEWS – almost! It was started in 1929 by Les Frantz as State Oil Burner Co., where he and partner Ken Swinford serviced coal stokers and oil lamps.
In 1937 the company became State Automatic Heating & Cooling Corp., and in 1944 Frantz bought out his partner. He has four sons, all of whom worked for him at one time or another.
Gary Frantz joined the ranks in 1966 and eventually became a primary owner. During his tenure, he increased the size of the business two-fold. Son-in-law James Gates joined the team in 1990, bringing with him new construction HVAC expertise. He has increased the size of the business by another 60 percent. His father, Bob Gates Sr., joined the company in 1998; and two brothers, Bob Jr. (1988) and Mike (1992) Gates are also part of the family team. In 1998, Gary’s oldest daughter Kathy came on board to administrate the office.
Publication date: 04/18/2011