At Heating Air Conditioning & Refrigeration Distributors International (HARDI), there are more than 430 member distribution companies. Zachary Perge, HARDI’s vice president for distribution strategies, said he’s not aware of one that doesn’t offer online sales to some extent.

HARDI’s “Voice of the Contractor” surveys, Perge said, have consistently shown an uptick in the proportion of contractors who say that e-commerce is their preferred method of ordering.

“HARDI members are focused on meeting the needs of their contractors,” he said.

At Winsupply Inc., one of the largest HVACR distributors in the U.S., more than 90% of the company’s outlets offer e-commerce, according to Daryn Cherry, the company’s director of e-business. Some 251 of its 650-plus locations carry HVACR products, and Winsupply reported 2022 HVACR sales of well over $1.5 billion. Online sales, Cherry said, account for about 15% of Winsupply’s total HVACR sales.

In Cherry’s view, several factors have fueled a move toward e-commerce in HVACR distribution. One, he said, is the tech-savviness of contractors.

“They’re used to using (computer) tools for quotations. They’re used to using field-management software,” Cherry said. “So it’s an easier sell, to get an HVAC company to use e-commerce, or it’s already an expectation of the customer that we have that.”

In addition, Cherry said, the coronavirus pandemic that began in 2020 pushed companies into e-commerce, as did the private equity firms that are investing in HVACR businesses, in increasing numbers, and then cutting costs.

“We’re seeing more customers want to be able to engage in a digital purchasing format, because they’re trying to streamline their operations,” he said. “So that’s kind of a couple things that we’ve seen sort of change in the industry.”

Perge said HARDI member distributors are incorporating features like customized apps, AI-powered chat, text-to-order, installation videos, and three-dimensional product images into their e-commerce strategies.

Winsupply, Cherry said, is pioneering two major e-commerce innovations.

One, which he calls “conversational commerce” (Cherry says he heard the term from someone else and isn’t taking credit for it), is an interface between a contractor customer’s enterprise resource planning (ERP) software and Winsupply. With that system, once a customer enters an equipment order into his or her ERP, Cherry said, it can be automatically transmitted to a Winsupply location, ready to be fulfilled, saving on warehouse labor that might otherwise have been spent transcribing an e-mailed order.

“Instead of having that sales rep read the email, go through it, try and figure out what those 80 different items are, and spend 15 or 20 minutes keying in an order, we’ve already done the upfront legwork,” Cherry said.

The other innovation, he said, is the use of AI to help build quotes when customers are developing a bid or a list of products they’ll need for a project. Through its “learning” of what’s available, Cherry said, that system can identify one or more items, and the price of each, that would meet the specs of each product sought by the customer for that bid or materials takeoff, automating and speeding up the process.

“We’re piloting that in roughly 10 locations right now. It seems to be going pretty well,” Cherry said. “But like all things, AI, you have to train it, you got to put a lot of source data in it. ... The better data and the more data you put in it, the better it’s going to spit out.”

Though low overhead and the data-tracking ability of e-commerce make it “essential” in HVAC distribution, said HARDI’s Perge, members are mindful of maintaining good relationships as well.

“Wholesalers know HVACR is a relationship business too,” he said. “The role of the branch manager and counter salespeople will always be of utmost importance.”

“I’ve seen people keep that relationship because of the service that is provided when they need it,” said Josh Crouch, founder and co-owner, with Brittany McGovern, of Relentless Digital LLC, which offers HVACR contractors digital marketing, website design, content writing, online sales help, and several other services. “So it’s definitely very relationship-based.”

Part of preserving those relationships is not selling to the general public, experts say.

“That will upset a contractor faster than just about anything, if their distributor lets a homeowner walk in and buy something,” said Crouch. “Definitely, the relationship is super important on that side. Otherwise, people, they (contractors) have options. They’ll go to a different distributor and buy a new line of equipment and buy their parts there.”

“I’d love to sell to anybody that wants to give us money. But at the same time, we’re very geared towards kind of protecting the trade” and doing business-to-business sales, said Cherry. “We want to work with qualified installers.”