It has been a year with mixed results. The change in the SEER situation is behind us and seems to be a non-issue at this point. There is some talk regarding the upcoming refrigerant change, but to most contractors that seems to be years and years away (actually only a couple of years). Certainly among the big news for the year is the fact that the new residential market is in the midst of a serious downturn.
You have read articles in this periodical, not to mention local newspapers and USA Today, continually discussing the status of homebuilders, the mortgage situation, and the overall home building market. The two coasts and parts of Michigan appear to be the hardest hit, but all over the country there is definitely a significant reduction in the number of new construction starts. Naturally since our contractors are installing the furnaces and/or air conditioners going into those new homes, those contractors have been seriously affected by this downturn.
EXPLAINING THE 2007 TRENDSOn the positive side, a late burst of hot weather helped many of us have good years in the service and replacement sides of the business. Hopefully you have utilized many of the suggestions shown in the pages of this magazine to help diversify your business so that the new construction downturn hasn’t ruined your business. And, of course, the usual issues continue to face our industry such as technician shortages, material, equipment and gasoline price increases, and costs for health care. These all go a long way toward making our business anything but easy.
You might want to remember what an office manager-secretary who worked for us for 42 years had to say on this matter. I would complain about the difficulty of the problems and issues facing us and she would say, “remember boss, if these problems were all easy, WE could solve them and we wouldn’t need YOU!” Needless to say that quieted me down.
Have you noticed how we, as contractors, are excellent at finding reasons (i.e., excuses) for why things don’t go as well as we want or expect. And in our industry it’s easy to find “reasons.” The economy affects us, the weather affects us, oil prices affect us - why we can use a myriad of reasons to explain our deficiencies.
However, look around you at the successful contractors. They have been operating in the same economy, with the same weather, same oil prices as you have. How is it that they have managed to be successful? They have been successful because instead of sitting around complaining about all of the things wrong in the world that have hurt their business, they have gone out and found ways to overcome the negatives and been proactive in their ways of doing business.
LOOKING TO 2008As we move ahead into 2008, I hope that you will choose to be positive and proactive and seek out different ways to make sure your business can overcome all of the obstacles that the world throws in front of it.
For example, if fewer and fewer people are buying new homes, then that tells me that more and more people are going to be A: remodeling or renovating their current home or B: needing to replace that old, inefficient furnace and air conditioner they wouldn’t have replaced if they were planning to move. Those same people, if they don’t decide to replace, will probably need more service work than if they had bought a new home. I’m sure you all remember the old saying that when the world throws you lemons, you can either duck and complain, or you can catch the lemons and make lemonade.
I hope that as you plan and budget for 2008, you will take a broad perspective and plan your business around the markets that are going to be available to you. I guarantee that a year from now, when we look back on 2008 - regardless of the economy, the weather, or oil prices - there will many successful contractors. If you start planning properly now, you can be one of them.
Best wishes for a great 2008.
Publication date: 12/24/2007