This past year was seen as a largely positive one for the HVACR industry with a new Trump administration taking control and freezing some of the pending regulations that would have impacted the industry.
The NEWS got a chance to talk with Paul Stalknecht, president and CEO of ACCA, regarding some of the challenges the organization faced last year, its goals for 2018, and the current climate in the HVAC industry.
The NEWS: What were the biggest challenges for ACCA in 2017, and how did you overcome them?
Stalknecht: The biggest challenge last year — and right now — is what is going on in Washington D.C. as it relates to tax reform and some of the other issues. ACCA played a major role in protecting contractor interests in the tax reform legislation, especially as it relates to many of the provisions in there that impacted the HVAC industry, such as the HEAT Act, which would help incentivize commercial business owners to change out their equipment.
We spent an inordinate amount of time this year walking the halls of Congress, and we had our members talking to members of Congress. We spent a good amount of time watching the regulatory efforts this season — what they were doing, what they were working on.
Fortunately, with the regulatory reform, some of the freezing of the regulations gave us some breathing room.
ACCA is one of the foremost organizations in Washington D.C., representing contractor interest. We do that in conjunction with our colleagues as well. We are part of HVACR Industry Alliance, and this year, for the first time, we developed a six-point consensus agenda that all the members of the Alliance worked on.
I think you’re seeing the industry come together collectively and organizing its strength to push a legislative agenda for the HVAC industry. Right now, it looks very favorable on some of the issues for our industry, and I think that was a result of the coalition we had and the aggressiveness, collectively and individually, to advance the industry.
The NEWS: What is the greatest challenge HVAC contractors and ACCA will face in 2018?
Stalknecht: We’ve done extensive surveys of our industry, and the one thing we hear over and over is the same issue: workforce development. That’s going to be the biggest challenge facing the industry. We have several contractor task forces meeting within ACCA to determine some of the things we can do to help the contractors in their workforce development issues.
We’re also looking at it from the association perspective — how do we engage that new generation coming behind us? How do we get the millennials and the Gen Xers more engaged in the association world? We’re working very aggressively to do that and trying to find ways to really focus on the issues that relate to them.
We’ve been working inside the halls of Congress and in the regulatory agencies to advance workforce development issues, particularly as they relate to the trades. Needless to say, the Department of Labor [DOL] has a very integral role in this, and we’ve had meetings with them to try and advance industry issues. We just learned recently that Labor Secretary, Alex Acosta, will be a keynote speaker at our annual ACCA conference. He will be there giving a major address to the industry about workforce development and what the DOL and the Trump administration are working on. We’re excited about that.
The NEWS: What can we expect to see from ACCA in 2018?
Stalknecht: You’re going to see a brand new ACCA in 2018. We’re excited. For the last six months, we’ve been working with some outside consultants and some membership task teams to reinvent, redesign, and refocus ACCA into a new organization. We’re going to roll that out sometime this year. It’s going to have all new features in business development and marketing communications for contractors. It’s going to advance the core issues of ACCA, which nobody else has, and that’s the leadership and the prominence in the development of industry standards and building codes. We’re going to focus a lot of our activities around the training and educational issues for contractors based on our ACCA/ANSI standards as well as on the installation initiative. We’re also going to put a continued focus on government relations because it is essential. Contractors need that voice, need that advocacy, and ACCA plays a major part of that. In 2018, you’re going to see some major announcements from ACCA. We’re excited about our new focus, new vision. We certainly look forward to that.
The NEWS: What are ACCA’s goals for 2018?
Stalknecht: Besides the new ACCA, our goals are to develop those products to attract and train a new core of technicians in the industry as well as new programs and services to attract the next generation of industry leaders. So, we’ll be having some new activities there. The other thing we’re focusing on is working with other partners in Washington D.C. whose members rely exclusively on the services of the HVAC industry for their customer base. Those organizations, like the National Restaurant Association, where we developed a new manual called, ‘Maria’s Restaurant,’ that’s really geared to help restaurant owners and very small businesses learn how to properly handle the issues of dealing with customer comfort when they’re in the restaurant or in the stores. We’re doing a lot of activities for ancillary-type trade associations which rely heavily on the HVAC industry for their own businesses.
The NEWS: Is the HVAC industry in a good place for growth in 2018? Why or why not?
Stalknecht: We’re very optimistic for 2018. Many of the economists are talking about the potential for growth. For example, Connor Lokar, who will be a speaker at the annual ACCA conference and does extensive work for HARDI [Heating, Air-conditioning & Refrigeration Distributors International], was very optimistic about consumer spending on HVAC systems through 2018. With the adoption of the HEAT Act, there’s now plenty of government incentives to stimulate the economy, especially in our industry. We’re really excited about that opportunity and the fact that more and more contractors are recognizing the need and the mindset to own the home — that includes HVAC contractors. We’re seeing more getting involved in more areas of the home, like the whole-house building envelope, home automation, pest control, security systems, and even some that are getting involved in media and sound systems for the home. We’re finding the aggressive contractors are expanding their horizons beyond just doing HVAC work and really owning the home. And we’re trying to encourage that for our members. Those of them that do that have a tremendous upside in their business for the coming year.
The NEWS: Do you believe internet retail giants, like Amazon and Google, are a threat to the industry as they roll out their home services platforms?
Stalknecht: I don’t know if it’s necessarily a threat, but it’s certainly a game-changer for the industry. Just like anything else, when these new paradigms come in, smart business owners figure out a way to compete against these new business paradigms. I think with Amazon and Google, it’s certainly something the industry needs to watch closely, but there are many things contractors can do to be a separator from Google and Amazon.
I like to use a term contractors use to promote themselves — community-based contractors. It helps them get to know their customers better and develop that relationship. Just think about it — when you work with a professional contractor, there’s a trust factor there. When you call Amazon and Google, it’s likely you’re just going to get an in-and-out service technician to come in and handle your issue, and there’s no business relationship or follow up. But it’s much easier to go up to a homeowner and say, ‘Listen, I’m Joe Smith of Joe Smith Heating and Air Conditioning, based here in this city. I’ve been around a good number of years, and here’s my phone number, so if anything happens, you can call me. I own the business. It’s my name on the side of the truck.’ Amazon doesn’t have their name on side of the truck. And even if they do, who are you going to call when you have a follow-up problem? Or you need to have service right away? Just like anything else, contractors have got to put a little more focus on who they are, their community-based strategies, and get to know and understand the customers a little better.
There’s always going to be these new interrupters in business. About 20 years ago, everybody was concerned about utilities engaging themselves in competition with contractors. Well, contractors figured out how to change their business, how to change their structure, and they successfully navigated that challenge. Good contractors will figure out how to navigate this challenge, and certainly, ACCA will be providing members the necessary tools and services to navigate those third-party challenges they will now be facing in the marketplaces.
The NEWS: What advice would you give to HVAC contractors for the coming year?
Stalknecht: Be optimistic. There are plenty of challenges out there. Now is the time to do your marketing, look at operations, build a relationship with your existing customer base, look for expansion in other areas, and again, promote yourself as that community-based contractor. Become active in your community as a pillar in your community, engaging in working with your local school systems about the opportunities that exist within the HVAC industry, and organically grow your workforce base through your local educational system. Interestingly, those contractors I talk to that have become intimately involved with their local educational systems, they’re having no problem in workforce development simply because they’ve become a community pipeline for jobs because people know them, know their companies, and know their reputation.
Publication date: 2/12/2018