York 'Liberties Plan' aims to keep dealers independent

April 3, 2000
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STURBRIDGE, MA — To counter the vast changes affecting the country’s hvac contractors, the Unitary Products Group of York International Corp. has unveiled an ambitious plan to keep its dealers loyal.

Dubbed the York “Liberties Plan,” it’s aimed at securing continuing “independence” for dealers who haven’t been consolidated or rolled up.

It’s a new world out there, said Matt Peterson, York’s vice president, to a dealer meeting sponsored by Heat, Inc.

He pointed to recent upheavals in the contractor sector, like Lennox’s purchase of Service Experts, Carrier’s buyout of some of its large mechanical contractors, and Sears’ arrangement to sell Trane-branded equipment.

Add to that the large consolidated, publicly traded contractors who enjoy economies of scale on pricing and purchasing, as well as contractor buying groups, and the case gets stronger for independent contractors to find economies of scale for themselves.

Old alliances have crumbled, and manufacturers are competing with their own dealer network, Peterson said. In addition, the utility rollups of dealers in their territories has further eroded the base of truly independent dealers, he said.

Professional aid

Under the Liberties Plan, York dealers can tap into professional assistance in the areas of payroll and benefits administration, fleet management, and retail and inventory financing.

Oasis Outsourcing, Inc., a professional employer organization, administers the system. The idea is to free up the dealers’ time from the administrative burden of such tasks.

The program, open to distributors as well, allows the type of rates and financing usually available to a big Fortune 500 company, Peterson said.

Depending on their participation, dealers can choose from a menu of services, such as payroll administration, 401K plans, workers’ compensation coverage, health care, vehicle leasing, and fleet management.

In addition is a “no payment, no interest” financing plan.

Three levels of participation are offered:

  • The Bronze level for those buying a minimum of $35,000;
  • The Silver level for those buying a minimum of $75,000; and
  • The Gold level for those buying a minimum of $250,000.

At all levels, purchases must represent 51% of their total annual hvac purchases. The Oasis program ensures that participating dealers will cut their workers’ compensation costs by 10%.

All three levels also include dealer-incentive trips, floor plan assistance, Yellow Pages advertising, and Web page service.

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