Grainger's KeepStock programs help maintain inventory levels
Grainger’s KeepStock programs helps customers maintain inventory levels and results in fewer visits to the parts counter.

It’s hot and getting hotter. Customers without air conditioning are impatient and making more demands. They want relief now, not next week. HVAC contractors have been hearing this all summer. It’s nothing new. The challenge is to keep everyone happy without burning out the staff and losing customers to the competition, often comprised of lowball garage mechanics or rip-off, fly-by-the-seat-of-their-pants mechanics. It can be a tough balancing act.

The last thing contractors need during heated times is lack of communication with their suppliers, or even worse, a lack of repair or replacement parts. That’s why it is vital for contractors and suppliers to remain in touch, even if it means a 24/7 relationship. Information via communication is the real key to success or failure, and some HVAC contractors are finding that knowing the availability of parts and equipment, even if availability is limited, is better than not knowing at all.

Thank You Technology

Jerry Hall of Assured Comfort, Winston, Ga., is happy with the supply chain this summer. “We’ve had no shortages from Ferguson on parts or Lennox on equipment, and we have enough R-22 to last the summer,” he said. One way Hall uses technology to keep his inventory fresh is by paying for supplies as he uses them — via a barcode scanner. “We pay for the inventory on hand as we use it — by scanning it,” he said.

Cash flow is a big part of inventory flow, beyond simple scanning. G. Andrew Smith of Bob Smith Air Conditioning Inc./Aire Serv of Southeast Texas, Beaumont, Texas, likes to keep accurate accounting records and depends on the electronic invoice.

“It allows us to be sure we are accounting for all parts, tools, etc. that technicians may acquire, and compare the purchase order with the invoice the following day,” he said. “I also feel this is helping those supply houses maintain their inventories at usually adequate levels. The heat has stressed the ability of supply houses to keep up with condenser motors, and it has identified some shortcomings certain new motors have in handling the heat, but fixes are here or on the way.

“We have also seen a shortage in some window a/c units which we are told is due to a change in the control boards. Better supply houses are not stocking the old design due to the many repairs.”

Managed inventory is a key phrase that HVAC contractors are very familiar with and having a supplier to manage the flow of parts and equipment during the hectic summer season is important to people like Matthew Stewart of 72 Degrees Air Conditioning & Heating, Hickory, N.C. “The single most important technology I use for the distribution channel is the Barnett VMI [vendor managed inventory] program,” he said. “I use the program because Barnett is better equipped and staffed to manage my business supplies because they do this every day with an efficiency I could never match. This program moves inventory off my financials, it allows for proper material allocation for accurate job costing, and its accurate accountability reduces inventory loss and theft.”

Paul Sammataro of Samm’s Heating & Air Conditioning, Plano, Texas, is quick to thank Internet technology as the one main reason he can keep his parts’ inventory fresh.

“Internet technology is important for several reasons,” he said. “First, you have quick access to review parts nationally and access a distributor’s contact information quickly. Second, you have the ability to order online from most major distributors, eliminating phone hold time. The instant ability to order and confirm availability has accelerated the parts ordering process. Also having instant confirmation that the order has been placed is great.

“We have all been in the situation where the part is ordered over the phone, told will be in within three days, only to call and receive the apology that the order wasn’t placed.”

Wesley Holm of Thompson Plumbing, Heating & Cooling, Cincinnati, said the most important “technology” is the relationship he has with his supplier.

“Every day by 7:00 a.m. our supplier restocks each service vehicle,” he said. “Each order is separated by vehicle by day. This way we do not have any out-of-stock issues. We also do not have any warehouse personnel for an HVAC service fleet of 36. In addition, our supplier delivers installation kits (including equipment) directly to our jobsite each day. These deliveries are on time even if the job was sold at 9:00 p.m. the previous evening. It is common to have 8-10 installation deliveries per day.”

Suppliers Keeping Up, But …

Travis Seeger of Chesterfield Service, Chesterfield, Mo., is struggling to stay ahead while working with his supplier this summer — but it’s not a bad thing. “It’s definitely profitably busy this year,” he said. “We are struggling not so much with parts supplies but equipment. It’s been a struggle for evaporator coils since early June, and now we are seeing a lack of equipment from our main supplier. We are maintaining same-day emergency service for now. If clients have more than one unit in their home, we have been asking if they can wait till the next day.”

Tom Stritecky of Waterbury Heating & Cooling, Sioux Falls, S.D., did not have issues with his suppliers this summer, but he still is a bit wary. “The parts and equipment are OK at this point,” he said. “But rumors from the wholesalers and distributors are hinting of some shortages. With the heat nationwide, there will be an issue at some point — equipment more than parts will be an issue. The only parts issues were on some of the condenser motors, but sounds like more troubles just getting out there quick enough.”

In Mike Cote’s case, technology and bigger and better are not always the best supplier model. The owner of Jem Heating & Air Conditioning, Westminster, Md., said, “Satellite branches are maintaining less stock, and relying on a main hub to funnel materials to them, which causes delays,” he said. “I wish I had a nickel for every time I heard a counter clerk say, ‘I can get it for you tomorrow; it’s at our main distribution center.’ And we’re not talking specialty items, just run-of-the-mill materials.

“But I understand the distribution mentality since inventory tax is an issue.”

Sidebar: Supplying the Customers

In order to keep their customers well-stocked through the busy summer season, Eanes Heating & Air Conditioning of High Point, N.C., opened a new location that includes a filter store, becoming a supplier to the end user. “We sell return and supply grilles, a-collars, flexible duct, thermostats, etc.,” said John Eanes.

The company ( published this information in an e-newsletter sent out earlier this summer.

Publication date: 8/13/2012