In this edition of “Inside a Contracting Business,” Jeff Wagner, owner of Jansen Heating, Air Conditioning and Electrical in Freeport, Illinois, profiles his focus on high-tech offerings and explains why he prefers to train his own techs.
Wagner worked as a mechanical engineer, but saw the industry changing about 15 years ago. He wanted to buy a technical business and contacted a business broker. The 25-year-old contracting firm came with a truck, a building, and a customer list, but Wagner had to train himself in the business.
ACHR NEWS: What is the focus of your business?
Wagner: Our main focus is heating, air conditioning, and electrical. We are doing solar, geothermal, and ductless products from Mitsubishi. We like to get into the technology that other people don’t want to get into. It’s a nice market to be in, but nobody wants to spend the time to understand the technologies that make it work, so there’s less competition. We also like the challenge of it — every day is different.
Eighty percent of our sales are variable-speed, high-SEER traditional heating and cooling. We don’t do a lot of single-stage units. We do a lot of $2 million to $5 million houses. We do a lot of multiple units for new-house construction. We were one of the first to get into the branch-box systems with Mitsubishi. That seems to scare a lot of people and, frankly, if you don’t take the training, it should scare you. We have a fully trained staff for whatever we’re trying to do.
We do a lot of repairs on geothermal units that other people put in incorrectly. I’ve seen $150,000 jobs that never worked from day one because they were engineered incorrectly. The things you see just make you shake your head when you know better.
ACHR NEWS: How would you describe your company?
Wagner: If you buy something from us, we’re going to stand behind it. If we have to pull it up and change it, that’s what we’re going to do. We’re an elite dealer with Mitsubishi because we’ve gone to all the training and we understand what to do. We can offer a 12-year warranty on high-tech products, which is wonderful.
ACHR NEWS: What is your overall market like?
Wagner: We’re 90 miles west of Chicago. We work out of Freeport, Illinois, a town of 26,000. We work in a 20-mile radius. We’re mostly a farming community, but we have some weekend lake areas. People come out here from Chicago, so some of our customer base is really high-end. They’re used to nice things and interested in new technologies.
We’ve done traditional marketing — newspaper and radio — and we’ve had a lot of success with it. We educate our customers on what we have to offer and what these new technologies will do for them. We were recognized as one of the most energy-efficient companies in the region. I wouldn’t call it a niche, but we are kind of a pink elephant in the market.
At the beginning of this year, I went all digital. We spent a considerable amount of money and saw fewer people using our products than when we used traditional media. With traditional media, we are able to educate the consumers about what our products can do for them.
ACHR NEWS: How does specializing in high-tech equipment affect your hiring?
Wagner: We’re currently a 12-person shop. I started by myself 15 years ago. My first hire is now my lead man. We’re selecting employees with personal skills and training them ourselves. We don’t hire technicians from other companies. I don’t want to try and fix somebody else’s problem. If I train them the way I want them, I know what my product is out in the marketplace. We do a report card for every job.
We send them to distributor training and in-house training. We also brainstorm problems. I have two college graduates that couldn’t find a job and never touched a wrench before I hired them. I just hired four install technicians. We spend an hour every morning going through basic electricity, heat transfer, duct sizing — the whole shooting match. We’ll couple that with working on equipment in our shop that we’ve taken out of jobs that might be troublesome and we’ll create errors that they need to troubleshoot and find.
We’re developing our own techs. For us as an industry to survive, everybody is going to have to start doing that. Enrollment in tech schools is down. And I’ve hired people from tech schools before, and they don’t have any common sense and they don’t have any troubleshooting skills.
ACHR NEWS: How do you keep your employees happy?
Wagner: First, we try to train them so they’re competent and not under a lot of undue pressure. We try to pay them a wage that’s appropriate to the business. We also do quarterly profit-sharing checks. With that, everybody self-polices. They like to be part of a winning team. They see us as the premier shop in the market, even though we aren’t the biggest.
ACHR NEWS: What do you see as the biggest challenge in the new year?
Wagner: It used to be hiring technicians. Our technicians are also our salespeople. We need technically competent people who can speak to the public in a trustworthy manner. With this new group we hired, I think we have that.
ACHR NEWS: What do you see as the biggest opportunity?
Wagner: Coupling technology with rebates from the government helps a lot. For furnaces, we couple energy-saving rebates with manufacturer rebates to get $1,000 to $1,500 off, which makes them competitive with single-stage systems.
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