ACHRNEWS

Not Just About Heating in U.P.

November 28, 2011
Terry Hickmann and Charlie Elliott
ESCANABA, Mich. — In a somewhat slightly obscure location along the shores of Little Bay De Noc, in Michigan’s Upper Peninsula (U.P.), this town of approximately 12,000 hardy people like their hockey. According to Charlie Elliott, these people who call themselves Yoopers, also like air conditioning and heating too. The local Peninsula Bay Inn hosted approximately 50 HVACR contractors, many of whom drove for hours through some of the region’s most beautiful scenery, for an update on industry issues and technology. A few even came just to listen to Elliott tell bad jokes. Well, the jokes aren’t actually bad, but his delivery leaves a lot to be desired.

The jovial Elliott is a sales consultant for the G.A. Larson Co., a wholesaler of HVAC and refrigeration products. Even if his joke-telling is not quite Comedy Central quality, his heart is in the right place — with his customers. Elliott, a former contractor himself, said he organized the second Annual U.P. HVAC/R Summit to, “Set expectations for contractors in the U.P., bringing them new ideas and solutions, new advancements in technology, and give them a bigger perspective on some of the important things going on in this industry.”

When asked about Elliott’s effort at humorous welcome remarks, one anonymous attendee laughingly said, “Well, Charlie should stick to his day job, but I liked his videos. I really came here because the training is important for continuing education, and I get to visit with some of the Larson people that I ordinarily don’t get to see. It’s nice to see some of the new products, too.”

Elliott left no stone unturned as he promoted the U.P. Summit in true marketing showman fashion. In addition to numerous invitations, email reminders, and general cajoling, Elliott created two YouTube videos to capture the attention of his customers, one which you can view at http://bit.ly/uV2Iip.

The one-day event consisted of an Industry Leadership Track and a Technician Leadership Track. For technicians, the day opened at 8 a.m. with North American Technician Excellence (NATE) testing. The NATE testing was followed in the afternoon by three training sessions including: Combustion Analyzer Training presented by Larry Lemmens of G.A. Larson; a home connectivity industry update, and a refrigeration update by DuPont’s Ron Rizzo.

The other track included two keynote speakers: John Sedine, a Grand Rapids, Mich., contractor and immediate past chairman of Air Conditioning Contractors of America, and Mike Murphy, editor-in-chief of The NEWS. In addition, a political update was provided by local representatives, and a marketing planning session by Steve Casper of G.A Larson.

Refrigerant Issue

Rizzo told the audience, “We’ve had a cakewalk up to this point,” while explaining the current issues surrounding the transition of refrigerants toward lower ozone depletion and lower global warming levels. Though many still argue the legitimacy of ozone depletion and global warming, Rizzo spoke candidly about the change in opinion among industry manufacturers such as DuPont.

“We didn’t know the two scientists were right [referring to early studies about an ozone hole over Antarctica], and fought it for about 10 years. By the way, they won a Nobel Peace Prize because they were right!”

According to Rizzo, the worst measurement of the ozone hole over Antarctica was in 2006. However, it’s not getting better even though cutbacks of suspect refrigerants had already begun, and in fact, may be getting worse. And, another hole has been discovered over the Arctic region. He said that ozone depletion is not as controversial an argument now as it once was; everyone agrees that chlorine does attack ozone as it clings to refrigerant molecules. The validity of global warming is the point that is now being most vehemently contested. However, the general consensus is that ozone depletion is a real problem that the industry’s manufacturers, distributors, and contractors are addressing.

A Banker’s View

Another of the interesting sessions featured local banker, David Williams, of Upper Peninsula State Bank. His topic was commercial lending applications, but he also fielded a few stray audience questions that pertained to some residential or personal lending situations. However, Williams generally talked about the five C’s of credit.

Capacity is the cash flow to make payments and provide a return to an owner, referring to the owner of the debt.

Character is integrity. Credit scores validate this to some extent, but often a personal guarantee solidifies character in the banker’s eyes.

Collateral is the assurance that if a borrower does not repay a commercial loan, the banker will be able to sell your assets to get paid.

Capital represents the owner’s equity and staying power.

Conditions refer to miscellaneous factors such as the current economy or the business sector health.

Williams told the U.P. Summit attendees that the order of importance of the five C’s actually varies by lender and by transaction.

Williams joked with the audience when he said, “An audit is performed by people who come in after a battle and shoot the survivors.” However, the serious underlying message was his reference to a common practice that is becoming even more prevalent as bankers seek to ensure that their loans are secure over time. In other words, just getting out the door with the money with no further accountability is an old business practice. The easy loans that were being granted a few years ago are no more.

Still, Williams encouraged the contractors by telling them that banks do have money, and want to lend money in today’s business environment — they are simply being much more conservative than in the recent past. “I think our economy is in the shape it is because of the residential mortgage lending that was done with reckless abandon. Currently, banks have money to loan, but we are very selective about what we will loan money for,” said Williams.

For more information, visit www.galarson.com.

Publication date: 11/28/2011