Welcome to the first in a series of interviews with members of the contracting world, available online only for The NEWS Network members. This series allows HVAC veterans to share their insights on the current state of the industry and the issues facing contractors today. In this edition, Matt Marsiglio explains how his company, Flame Furnace, attracts both customers and employees in the competitive Metro Detroit market.
Marsiglio has been the operations manager at Flame for the past 23 years. The Warren, Michigan, company has been around for 70 years. It provides full-service electrical and plumbing services in addition to its main HVAC business, which is split about 50-50 between heating and air conditioning. About 80 percent of our business is residential and 20 percent is light commercial.
ACHR NEWS: Has your business been meeting your expectations?
Marsiglio: Yes. It’s been phenomenal. We should exceed this year’s plan. We exceeded last year’s plan. We’ve been very fortunate. We exceeded our goals without a lot of weather driving that. When we’re busy, we’ll fall as much as five days behind. This summer, we just barely reached that point.
ACHR NEWS: Are there any new consumer demands?
Marsiglio: We’re definitely seeing an uptick in mini splits. There’s more customer awareness of them and there are some applications where it really is the best solution. The other big thing is Wi-Fi thermostats. It is customer awareness, in part because they are sold in the big box stores, so there is more opportunity for them to see them. But they are still afraid to install them. We’re fine with doing that.
ACHR NEWS: You are in a very competitive market. What kind of marketing do you do?
Marsiglio: There’s a competitor off every exit on my ride home. We focus most of our marketing online. We make sure that we’re highly ranked on our search results. A large portion of our marketing budget is spent online. People need to find us online because that’s the world we live in today.
We don’t do it in-house. We have an advertising agency for that and they do a wonderful job.
We also have a lot of referral business. Google Reviews ties right into our software. We meet weekly to go over all our reviews, both good and bad, to see what we’re doing right and what we’re doing wrong. We have about 5,500 maintenance customers. Some of them have bene with us for 20 years.
ACHR NEWS: In addition to attracting customers, the big challenge these days is attracting employees. What do you do to hire good people?
Marsiglio: About four years ago, we realized that stealing somebody who was experienced from another company wasn’t a great way to staff. There are only so many of those guys out there. So we decided to hire right out of trade school or community college and then train them. These are guys who have some aptitude, but they really have a good attitude and they want to do this for a career.
We do OneScore testing before we even interview, which gives us their cognition, motivation, and aptitude. We know that we’re dealing with somebody who is motivated, who is smart enough. We have a three interview process. In the third interview, we put them in a room with some test boards, some air conditioners, and some furnaces to see how their minds and hands work together. With all that, we’re about 70 percent sure we have the right guy and about 30 percent is hope. Not every hire is a good hire, but the law of averages is in our favor.
Then we train them. There’s an old saying, “What happens if you train them and they leave?” Well, what happens if you don’t train them and they stay? We invest in them, give them a good place to work, treat them fairly, and pay them well. We don’t give them a reason to leave. We give them a reason to stay.
ACHR NEWS: One way you treat your employees well is by limiting 24/7 service. That’s a difficult decision for most HVAC contractors. How has it worked for you?
Marsiglio: We do offer it during the winter. The safety of the house generally isn’t compromised if there is no air conditioning, but it can be if there is no heat. It hasn’t been a negative for our customers and it’s been positively received by our service department. For us, it was all about safety first. We didn’t want to put our people out in the dark working on an air conditioner in somebody’s back yard.
We do leave availability first thing in the morning for medical emergencies and maintenance plans. We dispatch from 8 a.m. to 8 p.m. We’ll dispatch somebody at 8 with a normal charge. Today, there are more situations where both parties in a home are working. It’s expensive to take half a day off plus have the HVAC come out, so we schedule appointments for later in the day. That helps us win some business.
It was a numbers decision. We were paying for our staff to be on-call and we weren’t seeing the returns. It was also about talking to the staff and seeing what they don’t like. Only having to be on-call for half of the year is a reason for them to stay. Our technicians would like to get rid of on-call altogether, but we do owe the service to our customers.
ACHR NEWS: How do you make your business family-friendly?
Marsiglio: It’s a family-owned business with a family atmosphere. I’ve paid my own daughter to babysit for our techs so they could have a night out. Recognition doesn’t mean anything if they can’t get out because they don’t have a babysitter.
ACHR NEWS: What do you see as the biggest challenge for your business right now?
Marsiglio: The gap in the talent pool. You’re seeing a swing in more people going to trade schools. I teach at the community college part-time and you’re seeing more people in the classes. But there was that time when people stopped going to trade school, so there is a gap.
ACHR NEWS: How are you handling the switchover from R-22?
Marsiglio: The biggest challenge there is customers who aren’t well informed. You see some scare tactics across the country. It’s only going to get more confusing with all the refrigerant reform. There are multiple replacements for R-22. Now 410 is going to get phased out. It’s going to get interesting over the next few years.
We won’t stop using R-22 until we are absolutely forced to. The drop-in works perfectly fine, but what if it’s not available.
ACHR NEWS: What opportunities are you seeing right now?
Marsiglio: There are still plenty of people with 80-percent-efficency furnaces. People are paying for the upgrade in fuel savings and getting rebates from the utility companies. It’s a chance to provide better savings for the customers and better comfort. Our techs are about providing options, not making sales.