Mini Splits Put Wind in Restivo’s Sales
Old-school knowledge and newer tech’s flexibility give company an edge
“Over a three-year period, our gross dollar volume has doubled. Not just the mini splits — the gross business has doubled. But the mini split is a major portion of that.”
As the president/owner of Restivo’s Heating & Air Conditioning in Johnston, Rhode Island, Jack Restivo has the family business enjoying a fairly rare position these days: It is succeeding in its third generation, a time when many tend to deteriorate or sell off. On top of that, three next-generation Restivo men are pursuing their own trade educations and certification.
MINI SPLITS AND MAJOR TRENDS
Mini splits may play a significant role in the company’s recent growth, but this chapter reflects a longer-term commitment to providing good service regardless of the particular technologies or fuel sources of the day.
When Restivo’s grandfather founded the company in 1936, kerosene was king in the region. Business was good, but the large-scale move to fuel oil — which persists in New England well beyond anywhere else in the United States — created an industry shift.
Restivo’s father played a key role in guiding the business through that transition. Now, of course, New England homeowners rely on a variety of sources. Restivo works with the usual natural gas and electric equipment but also offers radiant and other capabilities alongside his mini split options as an LG dealer.
The company has worked with ductless since it got its first toehold in the U.S. residential market.
“We’ve been doing mini splits for probably 25 years, to be honest,” he said. “When we first got into it, it would often be someone who wanted to add cooling to that one room that they put on as an addition. It was typically a strictly cooling situation many years ago, but obviously over the years, that has changed quite drastically.”
INTO THE REST OF THE HOUSE
The occasional customer does only want to finally add some cooling capability. Restivo noted that certain parts of Rhode Island don’t have natural gas service, and in those cases, mini splits represent an obvious solution.
Beyond that scenario, more variables enter the mini split picture.
“For some people, the price doesn’t matter,” he said. “I shouldn’t say it doesn’t matter, but it’s not the first obstacle. They’d rather do it right, knowing that they’re going to accomplish their heating goals and their cooling goals.
“Then you’ve got the customer who just wants to use it as a supplemental system, and once the dead of winter comes, they’re going to resort to their primary heating source anyway. So those people are going to be a little bit more price-conscious,” Restivo observed.
If the key, then, is to understand each customer’s goals, the contractor should also look for an opening to correct a perception that once was accurate but has become the most common misconception about mini splits, in Restivo’s experience.
What do so many homeowners get wrong? He recited the familiar refrain.
“It won’t heat in the winter.”
Restivo understands that heat pumps picked up a lackluster heating reputation years ago because they simply could not compete with the region’s severe winters. Some customers might have also bought one because they had seen them work well in milder climates, he said, only to be disappointed with the performance and then upset by high electric bills after adding additional heaters to keep up.
However, as many contractors know, the technology’s strides in recent years now allow heat pumps and ductless options to serve with distinction all year. Northeastern contractors like Restivo have had special cause to welcome products like the LG Red that he installs, capable of heating when the outdoor temperature drops as low as minus 13°F degrees.
The key, then, is to educate the customer who “knows” what was common knowledge 20 years ago but isn’t the case anymore. As New Englanders look to replace old systems and often migrate away from assorted gas and oil options, that conversation can set the tone not only for exceeding outdated customer expectations but exceeding a contractor’s financial goals.
MONEY AND GOOD LOOKS
While the mini split appeal varies from region to region in the U.S., states like Rhode Island sweeten the deal with substantial rebates.
“2019 was our biggest year ever, and I think that the rebates had a lot to do with that,” Restivo said.
Consumers could take advantage of substantial incentives to use heat pump-based solutions “as high as six or seven thousand dollars, if they were doing two systems in their home,” he noted.
The public utilities commission has yet to finalize any rebate structure for 2020 in Rhode Island, according to Restivo.
“Even without the rebates,” he added, “it’s a no-brainer as far as anybody who wants to walk away from oil or propane.”
Rebates may help consumers get over any project costs, but developments on the manufacturer side have had to catch up to and overcome another common reservation in American homes: the look of a ductless unit up on the wall.
Restivo’s company and LG have come at this hurdle from a few angles. The fanciest is the Art Cool option, allowing users to incorporate their own image choices into a square wall unit that looks much like a picture frame and nothing like a traditional ductless fixture.
“That was always the go-to,” reported Restivo, “to try to get the lady of the house to be more accepting of something going on the wall.”
An upcoming cousin from LG is a line of low-wall units.
“So if there’s no high wall space, or if they don’t want to visually see the unit up high on a wall, we can take it down lower so that it’s kind of out of sight.”
Standard wall units continue to make up around 75 percent of his mini split business, and that is often the most cost-effective option for Restivo’s customers. However, ducted solutions continue to grow as a popular option in the toolbox, often going where no HVAC has gone before.
“We can either put one in a basement or an attic and use a couple of ducts to serve that room — often a kitchen or a bathroom that doesn’t have the wall space to put any kind of a unit — and accomplish getting a zone of cooling and heating into those spaces.”
Restivo estimates that about 90 percent of his mini split business is residential, but he did encounter a commercial application that relied on yet one more aesthetic fix.
A local bar’s owners desired the mini split’s boost in comfort, but they didn’t want the new unit to take away from the more old-school vibe of the place. First, the techs came in and got the equipment up and running.
“When that was done, a graphics professional came in and wrapped the mini split to look like it was a woodgrain, and it basically blended right in with the bar itself.”
One can almost hear Cliff from “Cheers” holding forth about the wonders of inverter technology and how the Egyptians not only drank a lot of beer but also pioneered indoor comfort through evaporative cooling.
Contractors might consider connecting with a local graphic artist for occasional project needs. Restivo added that the same professional who matched the walnut look for the bar has created skins to match existing wall colors. The approach can go the other direction, too, producing patterns to provide a more customized flair for the less aesthetically reserved homeowner.
CAUSE AND EFFECT
Restivo has seen the sentiment shift as ductless options have become more popular.
“Dating back five or six years ago, if I thought the mini split was the right way to go, I kind of had to tread lightly on the subject and see what their outlook may be,” he recalled, “And then I’d have to sell them on it. But now, it’s a totally different level of awareness.”
The company participates in trade shows around Rhode Island throughout the year. Restivo reports that now, “half of the leads we get out of a trade show will be requesting a ductless heat pump air conditioning system.”
Which means Restivo Heating & Air, like other contractors, has to stay ready and staffed for good installations in a tough hiring climate. His company recruits recent trade school graduates.
“We see what their abilities are. Someone who wants to learn is going to learn, right? So as long as we have the right guys teaching them and then put them into as many seminars as possible, they will learn if they want to.”
Some may not work out, and others may have strengths that don’t necessarily align with mini split requirements. Rather than have anyone specifically dedicated to these installations, Restivo manages so that on “all my teams that I’ve built within the company, I’ve got at least one more technically advanced person on the team who can handle the mini split” and coordinate proper installation.
As those ductless and heat pump jobs have grown in number, some other areas of the business have slowed accordingly.
“It’s really put a dent in my heating replacements, to look at how many boilers I’ve done over the last couple of years. Even my unitary air conditioning business and warm air furnace business has gone down a little,” he noted, chalking “a big chunk of that” up to the public’s greater embrace of modern mini splits.
It has more than evened out financially for Restivo Heating and Air, looking at the last three years of growth. That flows in part from its versatility with legacy systems.
“We’re fortunate that we also do gas fired boilers, steam, oil. We do all of it.”
Kerosene might not appear in the mix anymore, but the range of services reflects the evolution of heating and cooling in Restivo’s region over three generations. Doing it all has led to current customers “whose parents were dealing with my grandfather, and they remember the name from when they were a kid.”
Keeping that kind of customer comes down to doing the next job right, especially when the homeowner may be trying a technology that is new to their home. To that end, Restivo offered one parting piece of advice to contractors doing mini split installations.
“Don’t cut corners — buy the right tools to do the installation the right way, because otherwise it’s going to come back and haunt you,” he cautioned. “You can spend a long time trying to find a leak.”
“Perhaps You Should Consider the Mini Split Heat Pump”
Many professionals still use the term “ductless” as a shorthand reference for mini splits, even though ducted mini split solutions are finding more good fits than ever in modern residential applications.
Restivo would like to see the industry go a step further in the name of chipping away at outdated public perceptions.
“I think people should start calling them heat pumps more often, because as soon as someone says ‘mini split,’ they think of something on the wall. Which is obviously where a lot of the business is,” he acknowledged. “But if you start consistently calling them heat pumps, then I think the first perception won’t be that it’s just a wall unit.”
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