The sunshine state: contractors fret about weather first, everything else second
In this case, “in with the old” refers to the influx of senior citizens to this popular Florida region. While Tampa boasts an international seaport and St. Petersburg is making an urban comeback, the senior citizen communities provide the backbone for much of the residential a/c work.
Keeping the citizens cool is the job of many area hvac contractors, but 1999 hasn’t produced the same scorching heat that blanketed Florida in 1998. That gives business owners a reason for concern.
“We haven’t had extreme weather,” said Harry Friedman, general manager of N&M/Blue Dot, Sarasota. “The first three months have been terrible, despite beautiful weather.”
That statement may seem like a contradiction to most people but in this region, it makes perfect sense. Friedman depends on residential service for his business and with the increasing number of residential contractors in his area, it is imperative to keep his customer base.
“The pie [Sarasota] is being sliced into smaller pieces,” he said.
Further to the north in St. Petersburg, another type of pie is being sliced up. A new enterprise zone has been created in the downtown area, and one contractor sees this as an opportunity to grab a real big slice.
“Remodeling and renovating contracts in the enterprise zone will be given to minority contractors,” said Marilyn Sabo, president of ABS Air Conditioning Co., St. Petersburg. “I do a lot of work in this area and I wanted to be in their [local government’s] face.”
Sabo relocated her business from Tampa in 1997. Her main objective: to establish business in the new enterprise zone. And like Friedman, the weather in 1999 has given her reason to worry.
“For four months we did absolutely nothing,” she said. “The weather was too nice. You go from worrying about making the rent payment, to wondering if you have enough people to fill the jobs.”
Staffed for a heat wave?At a glance, it would be logical to assume that Florida contractors have an easy time attracting top-notch, qualified employees. After all, who wouldn’t want to work in a warm climate year round, surrounded by ocean breezes and many recreational activities?
Apparently many people would rather work in a different trade or in a different location.
Tampa Bay contractors are facing the same dilemma as their brethren in other parts of the country. Sometimes the most unusual reasons keep applicants from hiring on.
“It’s hard to find someone with a valid driver’s license,” explained Sabo. “And many of them can’t pass a drug test.”
“All of the trades face the same problem of finding qualified help,” said Bill Long, general manager of Ocean-Aire Conditioning, Inc., Bradenton. “The problem affects everybody because a whole project, like a house, can be held up by one area where there aren’t enough people to finish the work.”
Long added that he has lost nine employees who have, in turn, opened businesses that compete with him.
Another Bradenton business, hvac distributor Pameco, faces similar problems. “Bradenton has a low unemployment rate,” said Jim Pitino, Pameco regional general manager. “It is absolutely tough to find people.”
The lack of labor is particularly evident in the bottom line. There are virtually millions in lost revenues because contractors can’t fill the gaps with qualified workers.
“We turned down a half million worth of business last year because we didn’t have the people to deal with the increase,” said Lee Robinson, operations partner with Climate Design, Clearwater. “We also want to notch up our service department, but we lack the manpower.”
Keeping the one's you've gotThe clichÃ©, “The grass is always greener on the other side” can certainly be applied to the plight of Florida contractors. Business owners understand this and have taken steps to keep those they have.
“We understand that people leave before two years. It seems that two years is that magical number,” said Robinson. “We always make sure the people get their 40 hours even in slow time.
“We [contractors] need to give them bonuses and reasons to stay.”
Robinson also strives to make his employees feel important. “I like to give employees the opportunities to make decisions. It should not be a job where the owner tells them what to do.”
Mike and Laura Pearman, of Allstate Appliance and Air Conditioning, Inc./Service Experts, Tampa, like the idea of taking someone with little or no background in hvac and teaching them the ropes. That way, loyalty becomes a key reason for staying.
“We took a tow truck driver and turned him into a good installer,” said Laura Pearman. “We would rather take someone who doesn’t have any knowledge of our industry and train them from scratch.”
She added that her technicians take their training through the Residential Air Conditioning Association (RACA). The coursework involves hands-on training and theory.
“We pay for our guys to go through the training,” she said. “In the old days, technicians only had to know the hvac business. Today, you need to know something about a lot of trades.”
A few words about utilities, consolidatorsUnlike other communities profiled in The News, there doesn’t seem to be a sense of urgency about utility competition in this region. Florida has no utility deregulation laws on the books and none are on the horizon.
The prospect of competing for service contracts doesn’t weigh too heavily on contractors’ minds — yet.
“We haven’t seen much activity and I don’t anticipate Florida Power getting into the service contract market,” said Friedman. “I think the East Coast of Florida is seeing more competition from utilities than us.”
“We haven’t heard from all of the utilities,” said Robinson. “They have the potential to make an impact with their dollar strength and advertising money. They have an awesome cash flow.”
“I have a problem with utilities getting into the market,” commented Sabo. “We have all gone to school to learn this business and utilities can come along and take it right off our plate.”
If utilities can take food off the plate, so too can consolidators. But that is not the opinion shared by this consortium of Tampa-area contractors.
“I just think it’s a lot of Wall Street businesses coming in and buying up businesses so they can run them from out of town,” said Sabo. “I’ve been approached by consolidators. I want to make this business work by myself. I birthed this baby and I don’t want to give up so easily.”
“We get letters from consolidators every day,” said Long. “I think they offer a way out for owners. It’s made the sale price of the businesses higher, but a lot of that is paid in stock. I’d be open to entertaining their offers, though.”
Mike and Laura Pearman recently signed up with Service Experts and said they are happy with the decision.
“Consolidation will raise the level of service,” said Laura. “It will also help to get rid of some of the small, unprofessional businesses. I see it as a good opportunity for us.”
Mike added that he is looking forward to a “new beginning.”
Harry Friedman, who took over when the former owner of N&M died unexpectedly, said his company’s move to consolidate with Blue Dot was based on its comfort level with its new corporate bosses.
“Other consolidators were talking about making personnel changes and would not guarantee job security for our employees,” he said. “The former owner turned down a particular offer, even though it was worth more money, because he was uncertain of the employees’ futures.”
Although the issues of consolidation, utility competition, and the lack of qualified technicians continue to top national headlines, the Florida contractors interviewed for this story are most concerned about keeping their people busy and motivated during the “pleasant” weather stretches in 1999.