Consumer spending trends, regulatory changes, the looming transition to A2L refrigerants, and other factors that shape the distribution market paint an unclear picture of the year ahead. But Gee says that those distributors who can plan for different scenarios and be ready to “pivot on a dime” will fare best amid the uncertainty.

“It’s unfortunate. No one likes uncertainty,” Gee said last month during a break at HARDI’s annual conference in Phoenix, Arizona. But the best thing is to embrace the uncertainty and work within it, he added.

“Don’t let yourself get too frustrated by it, too angry about it,” Gee said. “Embrace it. Understand that’s the environment we’re going to be in.”

LOOKING UP: The grand staircase in the meeting-rooms wing at the JW Marriott Phoenix Desert Ridge Resort was decorated with a positive message for those attending the Heating, Air-conditioning, and Refrigeration Distributors International conference there. (Staff photo)

Andrew Larson, CEO of The Gustave A. Larson Go., shares Gee’s sense of uncertainty about the HVACR distribution market.

“We’re certainly at a crossroads,” Larson said. “We’re coming off, obviously, supply chain concerns and issues, and we’ve got, really, some uncertain times ahead, given the economy.”

Larson also sees “tremendous opportunities” and says his company will be buoyed by its strong relationships in the industry.

“We certainly feel we’re in control of our own destiny,” he said.

To dive a little deeper into Gee’s take on the state of HVACR distribution, we posed three questions to him in the weeks after the HARDI conference. Below is that conversation.

ACHR NEWS: Given all the HVACR industry, and the business world in general, have been through in the last four years, from a worldwide pandemic to supply-chain issues to inflation to extended lead times, what is your summary assessment of the current state of HVACR distribution?

Gee: The HVACR industry has proven to be one of the most resilient markets in the U.S. and much of the world. Its supply chain, however, not so much.

The current state in the U.S. remains largely in flux due to seemingly relentless waves of regulatory changes, which further stresses demand-forecasting, production, and procurement. We are re-adjusting to more normal levels of residential demand, and trying to keep up with strong commercial demand. Supply chains are better and getting smarter, but inventory keeps getting more expensive, so the smartest companies are going to win since you can no longer just throw product and warehouse space at every problem.

ACHR NEWS: What are the two biggest issues facing HVAC distributors right now?

Gee: Distributors remain in the crunch of heavy and imbalanced inventories while trying to navigate yet another technology transition, all while residential demand has cooled and the housing market and consumer confidence have waned.

Uncertainty and complexity are the two biggest issues, which is why we continue to preach the need to be the most educated and eloquent customer-facing workforce possible.

ACHR NEWS: Sum up what you think can be done to resolve each of those issues.

Gee: HARDI and its leadership have invested well over one million dollars to help prepare and protect our distributors and their customers.

We are launching a series of online course modules to help ensure customer-facing personnel truly understand all of the A2L regulations and how they impact the products distributors sell and contractors buy, and we’ll be launching a powerful chat tool to answer any industry question about the A2L transition, anywhere and anytime, with verified, trusted responses.

These are just two things, but they tie to our common theme of the most educated and eloquent winning the day. Distributors and contractors need to not only double down on training for their people, they also must ensure they’re plugged into resources like HARDI so they always have the most current information.

Things are moving fast, and those who are unaware will be exposed.