Contractors Pass Along Best Practices
These are just some of the practical suggestions offered by two separate panels of contractors, who held separate educational sessions at the 36th Annual Air Conditioning Contractors of America (ACCA) Conference.
A group of highly successful residential contractors discussed, among other topics, marketing, positioning, hiring, managing finances, and the "best practices" they use to remain ahead of the competition. The second panel consisted of three successful commercial contractors, who touched on everything from Nextel phones to documenting project progress.
Residential InputThe three residential service and replacement contractors who held court were: Charles Rauch of Valley Heating & A/C Inc., McMurray, Pa.; Michael Rosenberg of Rosenberg Indoor Comfort, San Antonio; and Babette Watterson of Watterson Service Group Inc., Cochranville, Pa.
Attendees were given a list of topics and were asked to suggest some, too. The first topic involved finding, hiring, and retaining technicians.
"We depend on our techs to go and find people," said Rosenberg. "That includes talking with workers at our supply houses. Once we find them, we never hire them on the spot. They have to go through several interviews."
In regard to keeping the talented ones, he replied, "Communication is the key to retaining them."
Watterson said that techs don't have to have a background in HVACR to work for her company. "We hire from outside the trade and look for aptitude and attitude," she said. "Most of the people we hire are known to our company. After we hire them, the new techs ride along with other techs during a â€˜probation period' to see if they are the right people."
Rauch's company uses different methods to find workers.
"We use a temporary agency and we advertise," he said. "We use a lot of manufacturers' training for our techs."
The next topic tossed around involved "knowing your financials."
"We get our financial reports on a monthly basis," said Rosenberg. "Each financial is broken down by department, but our overhead is not broken down by department. We use a service management software to give us breakdowns of profitability by service tech and job."
Rauch and Watterson said they use Quick Books to track their financials.
"We can dump information from our Excel spreadsheets into Quick Books," said Rauch. "I know my break-even point on a daily basis."
The panelists were asked to point out what sets their businesses apart from competitors.
"For us, quality work comes first and service second," answered Watterson. "We also believe that service means hearing a human voice on the telephone. Another thing that sets us apart is the thorough, whole-house evaluations, including Manual J calculations."
Rauch noted, "Our slogan is â€˜We care about you.' It is important that our customers talk to a live person. That is one reason why we have an answering service pick up our calls after hours."
Rauch also believes in remaining active at his local church and participating in local school activities. "By giving to the community, you can get a lot back," he said.
Rosenberg said his company does a very basic thing: "We treat our employees well because we want them to be happy when they go into our customers' homes."
In regard to advertising and marketing, Rosenberg asked the audience to consider hiring a public relations/communications company. "We hired a public relations company and got articles about our business published in the local newspaper," he said. "We also do a lot of newspaper inserts."
To keep the good customers, he said his company offers restaurant gift certificates to those who "refer us to other people." Meanwhile, both Rauch and Watterson said they focus on their existing customer base to market their companies.
"We grow through referrals," said Watterson. "We keep in touch with our existing customers."
Offered Rauch, "Good customer service grabs a customer and keeps them from looking around for someone else."
Commercial OfferingsThe three commercial contractors who participated in a panel discussion were: Bob Wasniewski of Roberts Environmental Control Corp., Tinley Park, Ill.; Jeff Beyer of Beyer Mechanical Ltd., San Antonio; and Josh Kahn of Kahn Mechanical Contractors, Dallas.
Kahn was the first to encourage all attendees in the room to join an ACCA MIX Group.
"If you are not doing it, do it," he said. "If you are doing it, no other information is necessary."
Through the program, Kahn said he was able to walk into one of his biggest competitors and "ask them how they do things."
"If you don't think one of your competitors in another city will not share, you are wrong," he said. "Just ask them if you can come to their office and see how they dispatch or see how they do an HR policy. You'd be surprised how much you will learn this way."
"Joining a MIX Group is probably the best thing we've ever done," he said. "My group has been together for about nine years and I know we've gotten a lot of great things out of that."
All agreed that pushing both education and training are important. Kahn said he copied Beyer's policy, which started about two years ago. At Beyer Mechanical, all employees are required to have 32 hours of training a year "before you can get a raise," said Beyer. "And we pay for half of that training."
One of the more difficult tasks Kahn said was getting his company's values placed on paper, which he considered a "good practice."
"Our company was founded on very strong values," he said. "Two years ago, we actually documented those values and defined those values in writing. It was painful. It was difficult. And, it took us several months, but now we use the value statement in the decision-making process.
"What I mean by that, for instance, do we hire this person because of who they are and how they match the value statement? Do we fire this person for being outside the value statement? Do we handle this invoice in a method that is in line or not in line with that value statement? It's just a process now for our company. We also certainly use it in marketing.
"Documenting those values has really made a big difference."
Wasniewski noted the need to foster relationships with customers, to make sure to retain key personnel, and to have a firm's "cost accounting" in order. Regarding the latter, he said, "Know what your overhead really is and what you really need to charge - and know when it is really time to walk away."
When the panel was asked to provide guidance regarding the supervision of commercial projects, Wasniewski suggested dividing the project into different groups and holding each group responsible.
"We divided up into different groups within the company," he explained. "There is a project manager, an assistant project manager, and project secretaries. They interact with accounting and the field superintendents, and they deal with a budget. This way, more of the project managers are involved with the project from the beginning. And that's real important.
"This way, you should know what all the costs are, what the overhead is, what the bottom line should be, but that won't be there unless you are getting good reports and going out to the field to see how much is really done, and what is left to do. It's pretty easy, as far as the equipment goes and most of the material, but as far as the labor hours, they are very important, especially the larger jobs. It needs to be broken down - so many hours for ductwork, so many hours for a mechanical room, a tie-in ... Breaking down bigger jobs into smaller ones can make all the difference."
Kahn encouraged attendees to seriously consider instituting global positioning systems (GPS).
"We GPS all of our field vehicles," he said. "I say this is under the heading of â€˜communication' because I don't have to call my technicians to ask where they are. We just look. If we have a guy in the service department working late on a job, we don't bother when he got home. Again, we just look it up, because we give all of our employees time cards."
How did his employees react to the GPS?
"The guys that were cheating hated it," he answered. "And, they don't work for me anymore."
In the end, Kahn said it is important to keep the "good troops" happy.
"A big plus for us has been our relationship with our employees," he said. "We hear a lot about relationships with customers, but we need to retain good employees. And you do that with relationships. And that's just beyond the business side. I'm not saying go out and go dancing with them, but know what their families are doing, what's going on in their families. They appreciate that."
Publication date: 04/26/2004