The NBC newsmagazine show ran a segment on June 29 entitled “A real air conditioned nightmare,” in which Houston-area hvacr contractors were caught on camera trying to oversell parts or services after offering “bargain” clean-and-inspect specials. The piece portrayed most of the featured contractors as less than honest and, in at least one case, gave the impression that a service technician had committed a criminal act.
Two of the contractors featured in the NBC piece, Goode Air Conditioning & Heating Inc. and Admiral Air Conditioning & Heating, met with The News recently to talk about the “Dateline” story. They also talked about how business has been for them since the broadcast, and explored ways the hvacr trade can improve its image.
Goode Air Conditioning & Heating Inc.Ken Goode is a well-known contractor in the hvacr community, both locally and nationally. Goode has been practicing his craft for 26 years, and along the way he has been a respected member of such groups as the Air Conditioning Contractors of America (ACCA) and Excellence Alliance, Inc. (EAI).
He is a strong advocate of proper employee training and raising the service bar in the hvacr trade.
He is also in a very competitive market, and he recognizes that some contractors use coupon specials that often lead to a bit of “padding” before the customer receives the final bill. He said that his basic charge for a clean and inspect is $47.50, which he maintains is profitable based on the flat rate system he uses and an adequate markup on parts and materials.
His trademark red trucks are seen in front of residential homes and light commercial businesses. Goode employs 20 people and goes to great lengths to keep his employees’ training up to date.
“Anything the service techs need to be trained in, we will do,” he said. “Good training has always been one of my major concerns. I also have to provide good wages and benefits to keep people here.”
Goode recognizes that a well-trained and happy service tech should never do what his tech did on camera during the story. His worker was caught urinating on the customer’s lawn and adding refrigerant from an upside-down canister (when the unit was supposedly overfilled already). The technician in question also appeared to alter the invoice amount, allegedly in order to pocket some extra money.
After “Dateline” called to request an interview following the taping of his worker, Goode agreed to talk. “I had nothing to hide,” he said.
He noted that the employee was a licensed technician but said he didn’t follow company procedures.
“Our technicians must get the customer’s approval before beginning any additional work on the system,” Goode stated. The employee is no longer with his company.
“Customers should always know who they are dealing with,” he added. “They should call the Better Business Bureau to see if a business is getting any complaints.
“I give my customers full information about my company. After all, it takes a long time to build a reputation.”
“Right now, there are too many parts changers out there because technicians don’t have adequate skills to diagnose a problem,” he added. “And state licensing laws make it pretty easy to get a license to sell and service hvac equipment.”
Goode has been applauded by his local contractor group for his handling of the “Dateline” situation. He was genuinely embarrassed by his worker and took his lumps for it, he said, adding, “One technician does not a company make.”
Goode was asked to come back to the house where the “sting” took place to replace a drier that was found to be defective. He eventually refunded the cost of the service call and, upon NBC’s request, donated the money to charity. That piece of information did not appear on the newscast.
Admiral A/C & HeatingIn January 1998, John Conley started from scratch. A veteran of residential service work in the Houston area, he decided it was time to run his own company. Conley now runs a business that will show between $7 million and $8 million in revenues this year. He employs 100 people and has locations in Houston and San Antonio.
Conley credits some of his success to the nature of the Houston market, which has seen far too many unqualified contractors.
“Some of these people are like nomads, travelling between Dallas, San Antonio, and Houston. And there are a lot of contractors who hire subcontractors to do their work.
“Some of these people can make $700 to $800 a day with no overhead. They are doing all right.” Their employees and customers, on the other hand, have suffered.
The high turnover rate among Houston-area technicians is a sure sign of poor training and a lack of loyalty, maintains Conley.
“We teach ethics classes here and all employees are required to attend weekly training classes,” he said.
But even the best-trained techs with the best test equipment can fall victim to the price mentality of Houston-area homeowners.
“We have other contractors come behind us after giving an estimate who use cheap metering equipment and tell prospects that our high-tech testing methods are ineffective and we are charging too much,” he said.
Conley stated that his service rates are “probably higher than anyone in town,” yet his $44.95 clean and inspect special is right in line with competitors. He admits that it is hard to turn a profit at less than $69.95, but he said the key to keeping prices low is volume.
He added that 90% of his work comes from referrals. He advises homeowners to thoroughly check out the contractors. “If a person doesn’t have a storefront, a permanent address, or doesn’t answer the phone, better find someone else,” Conley advised.
“Until we find a way to regulate the trade, we will continue to have problems.”
Conley said the “Dateline” segment was tainted from the beginning. He said his company has never offered coupons, but Dateline said he did. He said a standing grudge between himself and the Better Business Bureau led to his inclusion in the sting.
Conley’s business was not negatively affected by the piece because “Dateline” said that his tech did “most things right.”
“It was a positive experience because of how they portrayed us,” Conley said.
And why do some service techs pad their service tickets? It might be because they are offered spiffs and commissions.
Conley said that he offers incentives to his techs, but he quickly added that there is a catch.
“We test all equipment that is brought back in from a service call,” he said. “We want to make sure the replacement was justified.
“If you constantly harp on ethics, your techs will understand that there is a right way to service and sell.”
Publication date: 08/22/2001