Tom, how should HVAC contractors prepare for 13 SEER?

Some dealers need to be shocked into the fact they need a process. Only 25 percent of dealers have a marketing plan for 13 SEER. Everyone knows a train is coming down the track, only a few have a plan to jump out of the way. Dealers must be able to tell homeowners the good things about 13 SEER and why the change is coming. For example, we can save enough energy to keep from building thirty-four 400 megawatt power plants. Dealers should be comfortable telling a customer, "Your old unit needs a major repair and your indoor coil and furnace are the same age as the unit. If this was your garage door you'd have to come up with 100 percent of the money out of pocket. By replacing your entire heating and cooling system, you can choose the level of energy savings you'll have that can go towards the new system."

Dealers must become retailers. Retail selling requires that contractors condition and educate consumers so they can get what they want. Get to the need quickly: "If you could change one thing about the comfort level of your home, what would it be?"

When prices are higher, it has got to matter more to the buyer. The buyer must know what choices are available to them. Most buyers would be upset if the dealer didn't give them all their options. The goal is to walk into someone's home and gather enough information to educate and illustrate why there is no need to look any farther.

Tom, what steps should distributors take as 10 to 12 SEER is permanently phased out?

The biggest change our industry will see is the shift to prepared retailers who can differentiate themselves with products beyond 13 SEER. The first step needed is a meeting with every manager to determine 2006 inventory requirements. Each manager looks at inventory differently. The CFO sees inventory as tied up money, the sales manager wants enough inventory to fill every order. The CEO wants to maximize profits.

Distributors should have communicated their 10- to 12-SEER phase out schedule to their dealers by now. They must know each dealer's upcoming 10 SEER commitments to any new home construction builders and have enough 10-SEER equipment on hand to transition into 13 SEER.

Dealers and distributors who don't have a strategy to help their builders go from 10 to 13 SEER will lose sales. The sooner dealers tell their builders about the size and price of 13 SEER, the better.

By now, 13 SEER should be taking the place of all soon-to-be obsolete inventory. Distributors should know by now if they have enough warehouse space for all the larger sizes and additional related 13-SEER SKUs like R-22, R-410A, or line sets. To ensure the right stock is on hand, the entire indoor coil inventory must also be realigned to reflect the new mix of products. The quicker 10-12 SEER inventory is sold off, the more money is available to buy 13 SEER. Firms that keep ordering 10 SEER and adding all the 13 SEER could soon find themselves out of cash.

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

Publication date: 11/21/2005