“This represents a unique relationship between supplier and contractor,” said Roger Grochmal, ClimateCare chairman. “We are looking to reduce our inventory costs by having B&B warehouse and distribute our equipment.”
The B&B story is just one of several that came under the magnifying glass at the ClimateCare meeting in London. Several other developments that happened in the third quarter of 1999 were discussed, including:
- The introduction of two new members, J.E. Murphy Heating and Air Conditioning, Lasalle, ON, and Wismer’s Heating & Cooling Ltd., Midland, ON;
- The Outstanding Achievement Award presented to Peter and Margaret LaPosta, Woodbridge GTA ClimateCare, for their successful year of growth, customer loyalty, and profitability; and
- Approval of a number of marketing initiatives for 2000, including public advertising, trade show, and direct mail programs.
The group also rolled out its new advertising campaign aimed at independent Ontario contractors who would benefit from becoming part of the network.
'No hidden agendas'Jan van der Woerd, managing director of ClimateCare, said there are good reasons for joining the organization.
“We formed ClimateCare in 1992 for the betterment of all contractors in Ontario,” he said. “There are no hidden agendas with us.
“The average profitability of a ClimateCare contractor is currently double the national average,” he added.
Van der Woerd acknowledges that contractors today must be able to do better advertising and marketing in order to find new customers. He believes ClimateCare offers helpful advice and backs up its programs with a solid line-up of products.
“We’ve developed some secure packages with the best products available, including Carrier, York, and Ruud,” he said. “Having a good local name with strong national brand support is very important.”
ClimateCare has taken steps to deal with the loss of former Lennox dealers who have been bought back by the parent company and who now have ties to national consolidator Service Experts.
“ClimateCare’s relationship with Lennox was terminated as of August 1999,” said Roger Grochmal. “Two of our contractors who sold Lennox now feel a lot less pressure.”
Successful contractor discusses businessPeter LaPosta, owner of Woodbridge GTA ClimateCare in Vaughan, ON, and recipient of the Outstanding Achievement Award, gave members some reasons why his company had a 19.8% operating profit this year.
The owner, who said he is a technician with no business background, shared his winning formula: Â
- Put a business plan in place.
- Â Get rid of deadbeat customers.
- Â Stay away from new tract housing business.
- Â Sever relationships with “box mover” manufacturers.
- Â Collect money upon completion of job.
- Â Downsize operating space.
- Â Remove “non-dedicated” employees from the payroll.
- Â Reduce inventory.
- Â Attend more business seminars.
- Â Increase hourly chargeout rate.
- Â Implement flat-rate pricing.
- Â Utilize courier service to send parts to the field.
- Â Establish good relationship with local bank manager.
- Â Empower employees to become more accountable.
- Â Eliminate sales staff (everyone sells now).
- Â And take greater advantage of manufacturer discount programs.
“Our sales were up 15% this year,” LaPosta said. “We knew that things had to turn around and they did, thanks in great part to the ClimateCare group.”
The group is banking on success stories like LaPosta’s to inflate its membership and provide a solid alternative to consolidation or manufacturer roll-ups.