You really have to work to find a contractor who’s a pessimist about business in 2000. And why not? Last year’s unitary shipments of 6.5 million were another record year, while heating equipment shipments were also at an all-time high. New housing was excellent, and the hvac replacement market has never been stronger.
So the results of our contractor survey are not surprising. Only seven in 100 think business will be down, while the other 93 see an “up” year, or at least a steady one.
Even when asked to compare 1999 with how they thought it would turn out, only 12% said it was worse, while nearly 60% said it was better than anticipated.
Put another way, 73% of respondents charted a sales increase, and 15% said business was flat; 12% had a down year.
“I’m seriously considering exiting this trade,” said one respondent — a distinctly minority opinion.
All of this optimism is in stark contrast to the crazy changes that have been occurring to the dealer-contractor sector.
For example, two of the four publicly traded, nationally consolidated contractors (American Residential Services and Service Experts) have been absorbed by ServiceMaster and Lennox, respectively. Between them, these two consolidators had rolled up more than 500 dealers.
Only Comfort Systems USA and GroupMac remain, and they’re both in the multi-billion dollar sales category.
Make no mistake, consolidation has made itself felt. Six percent of respondents have sold their business to a consolidator. The holdouts are likely to remain just that, with 93% saying no thanks.