PROFITS MULTIPLY

Net profit is the real goal of business. It increases, and business expands when sales increase faster than overhead. Overhead items like debt service, office equipment leases, and support team salaries must be paid whether sales are made or not. Most of the overhead the business already has in place is sufficient to support the new sales added by the new comfort consultant.

A reduction in overhead has a turbo-charging effect on net profits. If overhead goes down one dollar and other items remain constant, net profit skyrockets a dollar.

In companies where the owner tries to sell and manage simultaneously, overhead can be up to 10 percent higher than necessary. With a full-time comfort consultant on board, many owners finally have the time to properly manage all aspects of the business.

MANAGEMENT MAXIMIZES MONEY

Choosing the right sales process is the most important step in managing sales and maximizing profits. The sales process a business selects depends on the type of customers it prefers to do business with. A sales process based on good, better, best logic could work when selling to entry-level and mid-tier buyers.

An emotionally based selling process is required to consistently sell premium products to discerning buyers. Any process that uses manipulation or doesn't focus directly on HVAC should be avoided. The process must make sense to the consultant, be comfortable for the buyer, and be easily managed by the owner.

The training piece of the process should provide the new consultant with the skills, tools, and confidence to excel in today's highly competitive price-focused market. The greatest results usually come from a multiday program that incorporates role-playing, coaching, and evaluating to help the new consultant effectively deal with all types of real-world sales situations.

Every sale requires a lead. The lack of good leads is the No. 1 reason new consultants fail. Even an inexperienced consultant will convert 25 percent of sales conversations into some sort of sale by just showing up on time and talking with people about comfort.

Many of the best leads come from service technicians. Each tech knows their customers and the type of problems these customers have been experiencing. The weekly service meeting is an ideal time for the owner/manager to talk to technicians about discovering good sales leads, and then discussing the best way to immediately transfer hot leads to the new comfort consultant.

One of the owner/manager's most pressing jobs is to help the new consultant continuously improve his/her sales skills. This vital, yet often overlooked step is key to the new consultant's growth and effectiveness and the company's growth and profitability.

Improvement requires measurement. If there is no measurable change, there is no improvement. The consultant must document and the owner/manager must measure lead sources, selling prices, closing ratios, and profit margins.

These items, along with all notes taken the prior week at every sales call, provide the basic tools the owner/manager needs to be an effective sales coach. Time must be set aside at least once a week for the coach and consultant to celebrate wins, review goals, and discuss improvement opportunities.

If you're an HVAC business owner, where are you going to be five years from now? Will you be wearing many hats in order to make a living or managing a sales process that leads directly to financial independence?

The wonderful thing about being in business in America is that every firm, no matter how small, has the potential of producing unlimited profits. Hiring, training, and supporting your first comfort consultant can be the most important step you take to maximize profits and turn your dream of financial freedom into reality.

Steve Howard is the founder of The ACT Group. He can be reached at either 602-678-1055 or steve@nopressureselling.com.

Publication date: 01/30/2006