There is no doubt that a company that has been around since 1893 has seen many different business cycles, changes to the economy, and social changes. The current leadership team, which bought the company in the 1980s, has seen quite a few them as well, but has worked hard to build on the long company history and grow the company into a leader in their market.

Jay, Chris, and Thom Stone; the current leadership team of Hyde-Stone Mechanical, which has locations in Watertown, Potsdam, and Plattsburgh, NY; have focused the company’s efforts on a Design/Build model that has helped them stand out and become a preferred provider.

Design/Build Over Spec/Plan
The leaders at Hyde-Stone Mechanical don’t pass over plan/spec jobs, but they prefer to be more involved with projects and take a design/build path. They find that when working as a design/build contractor they are able to provide a higher level of service and better meet their clients’ needs.

“Jay has always driven home to our team that plan/spec is a necessary evil, but design build is where it’s at” says Chris Stone. “Design/build is a lot more work/engineering than doing plan/spec, but you get that face-to-face time with the owner and you are part of the process from the beginning.”

The face time with the owner allows the team to know what ideas they have for their building and sometimes even an upfront dollar amount that they are looking to spend on each part, so that the company can give a full plan and come up with what is best to meet the
needs of the building and the client.

“It’s just easier to sit down with the customer and come up with preliminary plans, so you can meet their needs, then to be brought in later and have to work around whatever else has already been planned,” adds Chris.

And while the team would prefer to not have to do plan/spec ever again, they realize it’s not a reality. So, they do their best to educate their clients to the importance of having the contractor involved early in the process and then provide quality service when they do perform the plan/spec work, so that they stay with the contractor who does the service.

Leveraging Technology
For Success The team at Hyde-Stone has never been one to shy away from new technologies or advances inside and outside of the industry. Their entire service team is armed with iPads and iPhones to be able to give their customers the best experience and service possible.

“We outfitted our entire service team with iPads, so that we could make our processes more immediate,” says Thom Stone. “Not only does this make us paperless, but once the work is done, the customer knows what has been done, the office staff knows what has been done, and if there is something that needs to be order or followed up on, it’s immediate.”

“Another great advantage of using iPads is that our service team can take pictures and videos while they are on the job and share them with others,” adds Chris. “We even use Facetime so the techs can communicate with project managers, so there is real time problem solving. We can see what they are looking at and better advise what needs to be done.”

Of course when they made the change to the newer technology, there were employees who resisted. But, to help with the transition, they gave the lead techs the iPads first and had them find the bugs in the programs.

Another part of being efficient was adding GPS to all of our service vehicles, says Thom Stone.

“The truth is they didn’t really find any bugs,” says Chris. “They realized that the technology made this easier and were excited to make the change.”

Training Is Key
Training and employee development is continual for the team. And they have even been approached by manufacturers to send their team members to specialized training, so there are qualified contractors in their market area to properly commission certain systems.

“The industry is constantly changing, so we are constantly developing training whether it’s for project managers, office managers, comptrollers, or service techs,” said Chris.

And the leadership team feels that there is so much training readily available, that this year they are focusing on using what is already available to expand upon what they are already doing.

“There are YouTube videos from manufacturers or suppliers,” says Chris. “You can go any time 24-7 and watch videos on new products, installations, troubleshooting, pretty much anything you need. Of course if you are going to a manufacturer’s website to get the videos it’s manufacturer specific, but your team still needs to learn that if you work on those products.”

Besides the in-house training, several manufacturers have offered to bring out several technicians to their factories to
undergo extensive training.

“Because we do a lot of startups for other companies in our area, manufacturers know our company and want to ensure that we get the training we need to do it properly,” says Thom. “We invest a lot in this type of factory training. We’ve sent people to Power Flame, Rinnai, A.O. Smith, Daikin training, because sometime we may not get the bid to install the system, but we get called in to do those startups, so we want to be trained to do it correctly to win over the customers.”

Planning For the Future
The future for the Hyde-Stone team is very bright. They see a lot of opportunity to continue to grow and expand.

“I think we will be working more on our service department,” says Jay Stone. “The construction side has gotten really competitive and the margins are getting smaller. We can likely grow 5 – 10 percent each year if we work on growing our service operations.”

Chris agrees, “Growing the service side is going to be very important in the near future. Along with that we need to grow our Plattsburgh
operations. These two things will keep us on the right path.”

“I think that we also have a lot of growth potential on the facility management side of things,” adds Thom. “With a good game plan we can easily grow our company through these avenues.”

The only way to add growth to any company is through good honest employees. I feel we work hard to keep those good employees. When you
do that, it comes back in many other ways that most of the time you don’t ever see.

The post Design/Build Model Keeps New York Contractor Ahead Of The Competition appeared first on IE3: Indoor Environment & Energy Efficiency.

Target Direct Marketing is a term that I have heard and used myself for many years. I use it to describe the approach we can use to provide help for prospecting and setting First Structured Meetings in order to find new clients for commercial services. So what exactly is Target Direct Marketing? What tools are available? Where do I start?

As a reminder; when a thorough and comprehensive sales process and direct marketing approach are not adhered to, then we may miss the opportunity to completely resolve the “pain” and issues that the prospect or customer are experiencing. We fail to differentiate and become tangled in the short sales process that focuses on “price only” discussions and never have the opportunity to negotiate. Target Direct Marketing sets the sales person up for success and helps them facilitate a proven, comprehensive sales process.

Some of the rules of marketing correctly include; short concise Messages, Benefit Statements, a Simple Invitation, Actionable Instructions, great Graphics, and using Social Media; as well as traditional methods of reaching prospects in order to set appointments. The beginning of marketing means understanding our company, competencies, “elevator pitch,” and what markets to penetrate. Let’s first look at the Target Markets for Commercial HVACR Service and then explore the rules mentioned above.

Target Markets for commercial service include the prospects that are most likely to “partner” with us and allow a negotiation as well as understand the “Value Proposition.” Value of course can be perceived, yet, most business owners, building owners and facility managers desire a long-term relationship and want to be a good steward of the money and resources they invest!

Key or Target Markets include: Owner-occupied Facilities, Office Buildings and Local or Regional Property Management Firms (those that buy the land, build the building and lease it out), Healthcare Facilities of all kinds, Education Facilities, Manufacturing/Industrial/Distribution Buildings and some specialized IT, Data, Cell Site, Clean Room and Research Facilities. Many contractors gain relationships with local and state government facilities’ managers, however, converting a bid to a negotiated agreement can be difficult. Please notice that Restaurants, Retail and Bars are not high on my list. With all the other markets to penetrate, why have your new sales person “spin their wheels” on these difficult markets? We are reminded though that “Relationship” trumps all, in other words, if you have a great relationship with a poor market segment; “go for it”…just adhere to the sales process and qualify well!

Your Message to each of these target markets may differ; yet, a simple “elevator pitch” should be internalized by the sales person and show up on your website, marketing case studies, introductory letters and emails or communications using social media, especially Linked In. A strong message is filled with not only your company history and competencies but with wonderful Benefit Statements that relate to specific markets.

Example; “We help office building owners and managers reduce or control costs, manage the budget or improve cash flow, and improve the overall environmental condition of the facility related to HVACR.” An actionable marketing message speaks to a call to action such as; “We will call you next week to arrange a convenient time to meet” or “We offer a building performance assessment to help you resolve HVACR issues, please give us a call.” Of course every marketing attempt should be followed by an appointment setting phone call, email, or social media contact to gain access.

As we work throughout the USA and Canada, we find that target market leads are plentiful in most of our contracting businesses. Bobby Lockett, owner of Air Conduit in Louisiana, has reminded me that there are tremendous relationships already built into our customer database because of the installation and construction work that we, as contractors, have already performed. I am also reminded, as many as 80% of these contacts or leads have never been approached by our service sales people, at a high decision-making level. No one has met with and facilitated a First Structured Meeting with the CFO, Controller, VP Finance or Business Manager. This is a great place to start once a new service sales person has gained some experience. In our next article we will thoroughly discuss and describe the First Structured Meeting and how to facilitate that appointment.

In summary, use as much desktop published marketing material as possible, use benefit statements and case studies specific to the markets you are attempting to gain appointments with. Simple capabilities overviews, introductory letters and emails, website content and even the proposal documents should have common themes, graphics and messages with strong benefit statements. Use of a marketing firm should be directed by and coordinated by sales management for service sales and have continuity that introduces the sales process using language that is familiar to the prospect; We Meet, We Provide A Building Assessment, We Explore Options and then Present Recommendations with Financial Justification…all of which we will cover in upcoming articles, so stay tuned and “sell more commercial service” by learning more about target direct marketing!

The post The Commercial Direct Marketing Approach appeared first on IE3: Indoor Environment & Energy Efficiency.

It’s almost a given some days. You get called out to replace a heating and cooling system and discover a serious mold problem or realize the building is not up to code in some way. In order to do your job, you have to help the homeowner figure out who to contact to get the ball rolling on other issues he might face.

As HVAC contractors seek to be the one-stop shop for their customers, they sometimes find it is more economically feasible to partner with other contractors to fill in the missing skill sets in their labor force. This can be a great situation or it can create some serious problems.
Fortunately, there are several ways you can successfully partner with sub-contractors to keep your business booming and your customers happy.

Network with Other Service Businesses
If you plan to recommend another contractor to your customer, you want to be sure that they will treat your customer as well as you would, or maybe even better. Your customer may wind up only associating the experience with your company, even if it was a different company that didn’t provide excellent service.

Your role as intermediary is to make sure whoever you recommend is excellent. The best way to insure this is to get to know other contractors in your area. Join the local chamber of commerce, join a networking group for service businesses, and talk to your customers. If you notice a customer has recently had work done, ask who they used and if they are happy with the service.

Over time, you’ll develop a list of local businesses that provide various services. It’s a good idea to have several in each niche you can turn to for help, as one might be booked up and your customer may need something fixed now so he can have heat or air conditioning.

Make Your Expectations Clear
If you agree to refer another business, sit down with the owner over a cup of coffee or lunch and have a discussion about your expectations. Be polite, but make it clear that:

• You plan to refer him, if he’d like
• If you refer him, you are putting your name and reputation on the line
• You expect employees of his company to treat your customers with respect
• You hope he’ll refer you to customers as well and will do the same for him

This is not an easy conversation to have, but if you’ve developed a relationship through the networking channels mentioned above, it should be easier to talk through your expectations. You are going to send business his way and aligning your name with his, so if he balks at your concerns, you may want to reconsider referring this particular contractor.

Follow-Up with Customer
If you refer another business to a customer, take the time to follow up. Ask how the customer’s experience was with that company. Would they recommend the company?

If the customer is displeased for any reason, ask how you can make it right. No, it wasn’t your fault. You trusted someone else, but remember that the customer will associate this with your business as well. You may need to serve as the mediator between that company and your customer to make sure the overall experience is positive.

Hire a Company Yourself
Another option is to hire the sub-contractor to complete part of your work. This might behoove you if you have seasons that are particularly busy and you need extra hands to meet the demand, but your company isn’t yet in a position to hire those hands full-time and pay benefits and all the other expenses involved in training new employees.

If you choose to hire someone to do part of the work on a project, make sure they completely understand your company policies and customer service goals. Take the time to have them sign an agreement and complete at least a few hours of training in these areas.

Make sure the temporary hires are supervised by a senior technician. Never leave a temporary worker to complete a job alone as it may result in damage to your company’s reputation.

Be Selective and Be Aware
Be selective about who you recommend to your own customers or allow to take on work for you. While a company may have done excellent work when John Doe owned and ran it, things can change. John Doe may sell the business or hand it over to Junior.

This is where it becomes important to follow up with your customers and make sure they are happy with the service. If you start to get complaints about a company, you can try to meet and see if these issues can be fixed, or you can simply move on and not recommend them any longer.

Working with other contractors can be a scary proposition. You are putting your reputation on the line. However, it can also be rewarding and can result in new referrals as they tend to flow both ways. Only you can decide if you want to work with others.

The post Partnering With Sub-Contractors appeared first on IE3: Indoor Environment & Energy Efficiency.

Commercial HVACR service sales is all about the face-to-face meeting and an introductory interview for qualification. As we have mentioned in previous articles, a thorough sales process provides solid differentiation, keeps you on track, and has a positive impact on your prospect. In order to avoid the “price only” conversations with prospects, we understand the importance of words, positioning, direct marketing efforts, setting appointments, and now we would like to discuss the first structured meeting, or first meeting qualification interview. Setting a structured appointment with multiple decision making levels in a business is certainly the best way to position your contracting company and begin the sales process. There is a very specific format that we have seen very successful sales people utilize across many industries to help them gain a solid “plan of action,” and initiate a schedule to move forward.

The multiple stages of the first structured meeting would include, but are not limited to: rapport building; questioning and active listening; introducing capabilities and the associated benefits; and summarizing needs, hurts, and business objectives along with gaining agreement on a schedule. That seems like a lot to cover in such a brief meeting, and it is. Which is one of the points that we would like to make: the First Structured Qualification Meeting is NOT a five, or even fifteen, minute meeting! The reason for setting up appointments that are a half hour to forty five minutes (as discussed in previous articles) is that we want an amount of time for qualifying the opportunity, and learning about the prospects needs, pains, and business plans. The less talking that we do, the more sharing the prospect does, and the better the results are of this very important meeting.

Scripting is a great way to help “internalize” information we want to share about our contracting company, and why we are the best option to help our prospects. Scripting is simply writing out HVACR commercial contracting capabilities, specific benefit statements, stories of successes, and positioning questions. The scripts help us “internalize” the benefits of working with our contracting businesses, our specific competencies, and stories or case studies that we want to share. When we internalize the capabilities, benefit statements, and examples of how we help building owners and managers, we now have the freedom to ask great questions and concentrate on the prospect. An example of a general benefits statement would be, “We help building owners and facility managers reduce or control costs, and even improve cash flow within their business, while improving the overall indoor environmental condition of the facility.”

Once we know what we want to say, we can concentrate on the great questions that we want to ask. Questioning and active listening must be the majority of time spent in the first structured meeting. If this meeting is a half hour, 20 minutes should be concentrated on questioning and listening. If the meeting is 45 minutes, the questioning and active listening should take about a half hour.

Great questions are positioned as learning more about the prospect, their business, their building, the financial impact of the HVACR, and how recommendations might get approved. We believe in “Levels of Questioning” that allow the sales person to “earn the right” to ask the hard qualifying questions about how and when the prospect will purchase.

Levels of questioning include:

• Questions that relate to the prospect’s responsibility and business
• Questioning that reveals the issues and problems with the HVACR systems
• Questions that tie the HVACR issues and concerns into the budget or financial information (Building Ownership & Operating Costs)
• Questioning that helps us understand how and when recommendations are approved by the business we are working with.
• Using open ended questions that lead to probes such as, ”Tell me more about that, explain that to me, describe that situation in more detail please,” and the, “Who, what, where, when, why,” follow up probes.

By summarizing the discussion and verifying information, we use the questions and in-depth probing to reveal the needs, hurts, and business objectives of the prospect in order to gain a “plan of action,” or schedule to move forward. Taking notes in the first structured meeting is imperative, and we will access those notes not only in this meeting, but throughout the sales process to confirm and verify the most important areas of concern for the prospect.

The conclusion of a wonderful First Structured Qualifying Meeting is the agreement to, and scheduling of, future meetings. The physical survey will need to be performed, some financial information should be collected, and we need to schedule the Confirmation-Verification of Information Meeting. The most important future meeting to schedule at the conclusion of a First Structured Meeting is the meeting to discuss recommendations and explore options (the Confirmation-Verification Meeting). The collecting of several categories of financial information and the building assessment can be set up tentatively, but the Confirmation-Verification Meeting must be agreed to with a specific date and time as a plan of action.

This formal first meeting to launch the sales process is a critical step in the selling cycle, and sets the stage for everything else to come. We also know that this is a differentiation, and proves to the prospect that you are serious, you have a plan, the desire to help, and want to be thorough!

The post Commercial Service Sales: The First Meeting Qualification appeared first on IE3: Indoor Environment & Energy Efficiency.

Would you like to differentiate your commercial service business by being more thorough, collecting key financial information, and positioning your commercial offerings with cost justification? In the last several articles we discussed the early stages of the commercial service and service agreement sales process. Let’s now take a look at the stage of the sales process that is related to our survey, further qualification, and the collection of building ownership and operating costs.

Previously, we talked about the conclusion of a great First Structured Qualifying Meeting where we gain agreement to, and the scheduling of, future meetings. The physical survey of the HVACR equipment will need to be scheduled, some financial information will need to be collected, and we also schedule the Confirmation-Verification of Information Meeting (the opportunity to negotiate). Realizing this is very “dry” information, let’s dive in.

The physical survey combined with the collecting and reviewing of financial information can be described as the “Building Performance Assessment.” We are preparing for the most important future stage in the sales process, which is the meeting to discuss recommendations and explore options (the Confirmation-Verification Meeting)! At the conclusion of the First Structured Meeting, the Confirmation-Verification Meeting must be set up with a specific date and time, known as the “plan of action.” The collecting of several categories of financial information and the building survey should be set up as soon as possible after the First Structured Qualifying Meeting.

For now, let’s concentrate on the two critical components of the Building Assessment; (1) the physical survey, and (2) the collecting of financial information. The physical survey is performed as we have typically performed maintenance and project surveys for many years, identifying equipment model and serial numbers, location, access, component attributes, and taking photographs. The more information the better! Belts, filters, motor and compressor horse power, and any issues that exist, or are able to be discovered need to be noted. Photos can show dirty coils or filthy heat transfer surfaces, poorly accessed panels, missed repairs, or any other oddity that show neglect (all without indicting the facility staff using language).

The collection of financial information can be narrowed down to a few categories, or become a very thorough evaluation of many cost categories. We’re going to focus on the most basic financial review or cost analysis. We would want to collect financial information in three main cost categories; (1) two years of annual utility costs (if in a spreadsheet, we also need a copy of a few bills to show rate structure and cost per unit), (2) a few years of major component replacement and major repair costs, and (3) annual labor costs or outsourced services costs (this would also include the current agreement, if one exists). Many other cost categories can be collected and investigated including in-house staff costs, administrative costs, parts and materials consumed, and even the cost of lost productivity.

Costs are examined to “follow the money trail,” which means many businesses or facility owners are “nickel and dimed” by re-active repair costs, “band-aid” costs, costs that do not resolve issues and lead to excessive energy costs, and premature equipment failure costs. Costs can always be reduced through a proactive approach to maintaining and operating equipment. Reactive costs always cost more, and a thorough investigation of costs over a few years will reveal inefficiencies and neglect. Of course, should the competition for a specific maintenance agreement or project not be justified through the cost analysis, we must rely on lack of documentation, poor communications, neglect, or some other behavioral issue that would lead the prospect away from the competition. Many emotional issues are extremely important, such as a lack of comprehensive communications, hot and cold spots, unresolved issues, and the pain of unacceptable escalating energy costs. Many concerns outweigh the financial justification we look for, and yet any benchmarking, unusual financial information collected, Energy Star ratings, and review of out-of-line expenses help prove that our proactive, thorough tasking will truly save money over any reactive approach.

By merely introducing the cost categories mentioned, or using a visual aid such as an operating cost pie chart, will alert the prospect to the total costs that go into maintaining and operating an HVACR system. This presentation of the cost categories alone can prompt the prospect, and their accounting department, to help justify your proactive recommendations! Equipment manufacturers, ASHRAE, BOMA, the DOE (Energy Star), and several software programs (such as North Boundary) have cost analysis calculations and formulas using Cost of Operations worksheets that will produce a Financial Analysis. The financial analysis and cost justification tools are items that we are happy to share! Connect with me using the contact information below. There are many cost analysis tools available to contractors today, and we want to help you work with these tools.
The physical survey and cost analysis constitute the Building Performance Assessment, and can be used in a simple form or very sophisticated manner. Either way, the introduction of building operation and ownership costs for HAVCR should be included with the physical survey information.

The post The Building Assessment: Survey & Financial Analysis appeared first on IE3: Indoor Environment & Energy Efficiency.

Most building owners and operators are very familiar with performance contracting. A contractor evaluates a building, develops a list of energy conservation measures (ECMs), quantifies the savings, and then guarantees the savings will pay for the ECMs within a predefined timeframe. There typically is little or no risk on the part of the building owner. Many successful performance contracts have been executed and will continue to be.

Smart strategies like performance contracting continue to be conceived, tested, and proven in the built environment. As the continuum of ideas and ways to think about energy efficiency evolves, I’d like to mention another compelling method of making buildings more energy efficient, comfortable, healthy, and safe. It’s a financial vehicle leveraging building infrastructure (HVAC, lighting, plumbing, and electrical systems) so that owners can generate revenue from it while also reducing their capital and operating budgets.

This paradigm of energy efficiency is similar to the idea of a landowner signing a gas lease and receiving revenue from those resources (extracted by the expert at extracting gas). In this case, a contractor would lease and operate the building infrastructure for a period of years or decades and sell realized energy efficiency to utilities and independent power producers.

While positioning infrastructure as a resource in this way, the building owner also benefits from reduced capital and operating budgets because the contractor, per the lease, assumes responsibility for maintenance, repairs, and upgrades as part of its mission to generate energy efficiency.

This logic allows us to start thinking of infrastructure as an untapped, predictable, and readily available resource that a building owner can tap to achieve an exceptionally efficient building with increases in capital instead of expenditure.

The post Building Infrastructure As A Revenue Source appeared first on IE3: Indoor Environment & Energy Efficiency.

Question: want to avoid price only discussions while selling planned maintenance?

Answer: utilize the most important step in any sales process in any industry, which is the Confirmation and Verification step that gives the sales person the opportunity to negotiate!

Previously, we talked about the physical survey combined with collecting and reviewing of financial information, described as the “Building Performance Assessment.” We are now ready to facilitate the most important sales meeting or stage in the sales process which is the meeting to discuss recommendations and explore options (the Confirmation-Verification Meeting)!

Remember, at the conclusion of the First Structured Meeting, the Confirmation-Verification Meeting must be set up with a specific date and time (which is known as the “plan of action”). The collecting of several categories of financial information and the building survey should have been completed as soon as possible after the First Structured Qualifying Meeting.

There is a very specific format for the Confirmation/Verification stage of the sales process and it generally will include:

Discussing the needs, pain and business objectives obtained in the first structured meeting

Reviewing of the options and recommendations that are to be presented formally in a proposal

Discussing the savings or cost avoidance of the recommendations with benefit statements

Gaining agreement on the final proposal details and specific recommendations likely approved

Presenting the financial justification in a simple chart and discussing the price of your options

Negotiating the deal!

Again, the Confirmation/Verification Meeting or (phone call for smaller maintenance agreements), should be set up in the First Structured Meeting and be the primary meeting date and time set up as the “Plan of Action” in that first meeting. We ask for the confirmation meeting by stating that we would like to explore all options and discuss the recommendations we come up with in order to obtain the prospect’s feedback or input.

Let’s script this:

“We would like to set up a time to meet with you for about a 45 minutes or so to discuss the options that you will have and any recommendations we come up with. We can discuss the costs, money saving opportunities, and specifics at that time and review any changes to the program that will be presented as final agreement documents.”

“I would like to set up a time to meet with you and anyone else that may have feedback or input related to moving forward with our recommendations. Can we meet late next week or the following week after our building assessment (survey and collecting of building operating costs) to explore all of the options you will have?”

“I’m certain you will have some options to review before we move forward and you can help us prioritize these options, review our pricing, and I can place the recommendations in a formal document soon after that meeting. May we meet two weeks from today?”

The opportunity to negotiate during the Confirmation/Verification Meeting is based on the fact that we only verbalize our pricing for any options that we present. Rounded up numbers are very beneficial for this discussion and allow for feedback and negotiating. How do we negotiate? Should the prospect be “shocked” at the price of our options due to our thorough approach, we want to ask “what would we omit?” or “what budget number did you have in mind?” and begin the discussion and questions about how thorough and comprehensive our recommendations are and that we would have to omit hours or specific different offerings that may not solve their problems if we cut costs?

Negotiating is an art and role plays for negotiating are essential in any sales training format. It takes practice to position, ask questions, present financial justification (based on collected building operating costs), and negotiate in good faith with any prospect or client. Please take time to thoroughly understand the stage or step in the process related to Confirming Needs, Pain and Business Objectives and Verifying Financial Information. The use of this one step or stage in any selling system can completely change how successful you are in selling and the ability to gain higher margins!

The post Confirm, Verify, & Negotiate the Sale appeared first on IE3: Indoor Environment & Energy Efficiency.

When the U.S. economy soured in 2008 and business shriveled up, the staff at Trademasters Service Corp., in Lorton, VA, looked at each other and asked, “What do we do now?” They decided to make a bigger push into government contracting, an area in which the firm had always worked, but not as the prime contractor.

Today, Trademasters has a government division, in addition to its commercial and residential divisions, and about 80 more employees. Its business has grown approximately 20 percent annually, year after year, with the addition of clients such as the U.S. Naval Observatory, Andrews Air Force Base, and Arlington National Cemetery.

Granted, Trademasters is located near the nation’s capital and its alphabet soup of federal agencies, offices, and departments. But plenty of government contracting opportunities exist even outside the Washington area, contends Dave Kyle, general manager of Trademasters. For starters, you’ll find federal buildings in every state and most large cities.

“Many of those buildings are large, old, and not particularly efficient. There are government mandates to improve federal buildings, with net-zero requirements by 2030 and 2050, so it’s a good market to play in right now,” says Kyle, whose company does not work in new construction. Plus, he notes, federal law requires 23 percent of all government spending to go to small businesses—defined, in the case of HVAC contractors, as companies earning an average of $15 million or less over the last three years.

“The government is really looking for small businesses that meet its requirements and self-perform—that actually do the work themselves—and our industry is almost all small businesses,” adds Kyle. “The government has a lot of work that needs to get done, so even the crumbs you pick up can be huge.” Trademasters, for example, has government service contracts that range from hundreds of dollars to tens of thousands of dollars in billings per month.

Some Extra Effort

To be sure, working with a federal, state, or local government entity requires some extra effort. According to Kathy Townsend, Trademasters’ director of government procurement, “The government likes very thorough estimates and, even for emergencies, wants lots of details, not just a bottom-line number. And once they’ve awarded the work, they don’t like surprises that up the cost of a job.” Some agencies, she adds, require contractors to use a particular software program for estimating, while others favor a particular.

“Is government contracting difficult? Yes, it is,” Kyle confirms. On the other hand, the government typically pays its bills in 30 days and offers many interesting work opportunities. “A lot of our work involves more complex systems, which requires a higher level of expertise—and that usually means better compensation for our staff,” says Kyle.

He and Townsend offer these suggestions for growing your government contracting business:

START SMALL. Initially Trademasters gained experience as a prime contractor through work for local and state governments, such as replacing equipment at K-12 schools and public universities. “Every county and city usually has its own online bid site, where you register and upload your license and insurance information,” Townsend explains. “Sometimes they invite certain businesses to bid, so make yourself known to them and get vetted in advance.”

Although it’s not a builder, Trademasters also obtained licensing as a general contractor. That designation enables it to bid on jobs that are primarily mechanical and then subcontract for any needed masonry or tile work.

GET SCHOOLED ON THE SYSTEM. If you’ve ever filled out an income tax return, you know governments have certain procedures to follow and forms to use. Fortunately, free or low-cost assistance is available to help you understand how everything works.

Townsend suggests accessing the System for Award Management (sam.gov), where you register to do business with the federal government, and Federal Business Opportunities (fbo.gov), where you can view videos and search for opportunities by state and type of job. The Small Business Administration (sba.gov) offers self-paced audio courses on topics such as Government Contracting 101 and How to Prepare Proposals, plus a list of nearly 100 Procurement Technical Assistance Centers, where staff advise small businesses how to compete in the government marketplace.

“There are also small business utilization officers in every agency, in every state, who are looking for good contractors to recommend,” says Townsend, who recommends participating in vendor days hosted by the officers.

“Retired federal employees who worked in the contracting arena are another helpful resource,” she continues. “They often work as consultants, and you can hire them to help you write proposals and understand the procurement process.”

READ THE FINE PRINT. Bidding on a large project may mean wading through 400 pages of specifications before crafting a proposal that not only fulfills every requirement, but also accounts for every nickel and dime.

“There’s no shortcut—you actually have to read the requirements, which can be difficult and sometimes pretty boring,” says Kyle. After analyzing a job’s requirements, Trademasters typically compiles a list of questions for the government to answer, such as confirming the project’s scope and determining whether certain tests are mandatory.

Make sure you understand all the reporting requirements in advance, because a contract isn’t considered complete until all the paperwork is done,” adds Townsend, noting you may need to track all subcontractor hours or submit receipts for all materials purchased.

As another example, says Kyle, “some of our co-workers are legal to work in the United States, but are not citizens. That means they can’t work on military bases and most federal sites, which require U.S. citizenship.”

ADAPT YOUR OPERATIONS. An integrated software system that handles everything from payroll to job costing to dispatching is essential to managing large government projects, Townsend emphasizes. “We cost everybody’s hours to the job, so they’re used to providing a detailed list of what they’ve done and where they’ve been,” she says. “Having one system to track all costs gives us the number we use to compute our overhead and helps with estimating future bids.”

Some federal jobs may require additional coaching of employees—such as reminders not to smoke, curse, or use a cell phone on site. “There are different standards of deportment for any sort of public site, where you need to be extra vigilant and careful,” observes Townsend.

It’s standard procedure for Trademasters to conduct background checks on employees, but those working on federal contracts—and subcontractors—require additional scrutiny. You’ll have to exercise patience while waiting for security clearances and badges for employees, which can take months. Once those badges are issued, however, your firm moves onto a short list of vendors with the credentials to respond to emergencies as well as handle routine maintenance and repairs.

“Working for the government is no different than any other client—it’s all about the trust and relationships you build,” says Townsend. “Once an office or agency knows you and knows you do good work, they’ll call when something comes up.”

For Trademasters, another benefit of government work has been its steady nature. “We never have a shoulder season. We never seem to slow down and are able to keep our staff busy year-round,” says Kyle, describing the exact opposite of the situation Trademasters found itself in just eight years ago.

The post The Ins & Outs of Government Contracting appeared first on IE3: Indoor Environment & Energy Efficiency.

Working in hospitals, especially in remodel and upgrade projects, is always a challenge, according to Roger Gundlach, president, Gundlach Sheet Metal Works, Inc., Sandusky, OH.

“You may have to work in a sterile environment, and you may have to keep one end of the department open while you’re working in the other so you end up having lots of partitions and protection devices,” he explains. “You have people on ladders and another person at the base of the ladder to direct hospital personnel around it. You may have to set up, and then if there is an emergency, you may have to tear down, so they can handle the emergency.”

He recalls the company’s recent installation of ductwork in a local hospital that upgraded its entire labor/delivery department. Because the department was located in the middle of the hospital, his crew had to tie into multiple existing systems and reroute ductwork—all while keeping the area in operation. “We would work on one floor, go into an area, tear ceilings down, reroute and reconnect ductwork, finish that area, and go to another floor,” he says.

His technicians often worked at night just to avoid the crowd of electricians, plumbers, and other trades who were jumbled together while trying to complete their assigned tasks. “You can’t get all those people into one space at one time,” he says, “so it sometimes worked better if our guys worked an off shift.”

To control communicable diseases, he indicates that hospitals typically have special filter banks. “If you’re going into the hospital to service or repair that piece of equipment or change the filters of that equipment, it may require special protective clothing and a special breathing apparatus because you could be pulling filters out of a unit that has captured microorganisms or viruses from a communicable disease.” In those cases, he says, technicians change the filters and seal them in airtight plastic bags for hospital disposal.

With 40 to 45 employees, the company averaged close to $8 million in sales and service in 2015, of which about half was construction related.

Managing Multiple Logistics

Even something as simple as getting deliveries can be a challenge in a hospital environment, emphasizes Steve Barnhill, fabrication services manager, Ivey Mechanical Company, a company with offices throughout the southeast and headquartered in Kosciusko, MS.

“A hospital is typically a congested area,” he says. “The logistics of managing people and materials can be a challenge. We need to get our workforce and materials in and out of the facility with minimal disruption because people are trying to recuperate from medical issues. Hospitals don’t have holiday shutdowns. They are 24/7, 365 days a year. You have to understand that and plan accordingly.”

For example, he says, the company has been involved in renovating a hospital in Jackson, MS, for 2 ½ years. “A big part of that renovation has been changing out air handling units with a very limited shutdown,” he explains. “We have to put in a temporary air handling unit, do temporary duct work to support that unit, then go into the space where the existing air handling unit is, demo it, put in a new one and put it in service, and take out the temporary one.”

When working in an existing area of a hospital, Barnhill often brings in special pressure machines that add to the filtration of the air-moving systems. “You have to maintain a slight negative pressure in the area you’re working in because you don’t want dust from the construction activity to be pushed into an operating hospital environment,” he says. “You have to be conscious of the pressure relationship between your work area and the other parts of the hospital.”

The company employs more than 800 and has a total sales volume exceeding $150 million, of which about 25 percent is hospital related. According to Barnhill, the biggest chunk of the hospital work is plan and spec or design assist “where we add the knowledge of cost and constructability factors on the front end of a job.”

Keith Paton, vice president of service, estimates Ivey Mechanical provides service to about a dozen hospitals and 20-plus smaller clinics. “Typically we have preventive-maintenance contracts with our hospital customers,” he says. “We go out and do work periodically to be proactive on maintenance and repairs. We don’t wait until it’s broken down to fix it. We try to predict what will happen and fix it in advance.” He adds that many hospitals have their own maintenance staffs, which he supports when they don’t have enough manpower or experience to complete a complex job.

Paton agrees that hospital work can be dangerous without the proper precautions. “There are hazardous materials, contaminants, and diseases associated with a hospital that we have to know about in advance. We have to be able to keep our people protected. We want everyone to go home safely to their families. That’s a big part of all that we do.”

Put Patient Care First

When you are working in health care, you have to remember that patient comfort and care are your client’s top priorities, which often requires flexibility in scheduling, shift work, and a detailed plan for daily execution, says Joe Nichter, president, Comfort Systems USA Southwest, Chandler, AZ.

“We have had several situations where we have worked in existing facilities with equipment changeovers that had to be scheduled, which included a shutdown for the hospital’s chilled water and steam systems,” he says. “These types of changeovers require significant planning to make sure everything is ready, including parts, equipment, adequate manpower, vendor backup for unplanned material, and the proper supervision to make sure the work is performed in a timely manner with a major focus on safety, quality, and productivity.”

Comfort Systems USA Southwest performs work in assisted living, vivarium, and acute care facilities, medical office buildings, hospitals, surgery centers, and behavioral health and genomic labs. Nichter estimates the company’s sales volume in health care over the last 15 years comes in at $250 million, which covers “everything from a $1,000 valve change to a $20 million new hospital.” About 10 employees specialize in ongoing health care work, a number that might spike to 60 to 70 installers for a new ground-up hospital.

“We believe healthcare is a good niche that provides us with cradle-to-cradle possibilities,” he explains. “We start with the new construction phase, which leads to future expansions and continual work for our building services division. In addition, there are multiple associated businesses that live within the health care industry.”

He points out that the company’s HVAC mechanics receive a medical gas certification as well as training on Infection Control Risk Assessment (ICRA) best practices in healthcare construction, which ensures they know how to contain pathogens, control airflow, protect patients, and work without disrupting adjacent operations.

“Healthcare is a growing market, and the future looks promising for continual growth,” he indicates, “but it requires a significant training investment for your technicians, especially if you are going to be involved in hospital facilities. Lack of preparation can be very costly to the contractor and customer if 100 percent isn’t given to the preplanning for every project. The last thing you want is for your work to disrupt patient care.”

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Have you ever heard of a proposal-presentation “hybrid?” Well let me explain. Once you have moved through this comprehensive, relationship-driven sales process, you are ready to present final recommendations. The use of a proposal-presentation hybrid means that we not only provide contract documents for any project work that is combined with the planned maintenance agreement, but that we compile a set of proposal documents that accompany the contracts and signature documents. We are talking about proposal documents that are almost set up in the form of a PowerPoint presentation or that could be easily included in one. Previously, we talked about the Confirming of Information from the “Building Performance Assessment” and negotiating options that the building owner or manager may have. We are now ready to facilitate the “closing” sales meeting or the stage in the sales process which is the meeting to gain signatures!

The Confirmation-Verification Meeting gives us the ability to negotiate and discuss options without any contract or agreement documents present to distract or take us off point during the discussion. The ability to discuss options and solutions in an information setting is key to this thorough process and prepares us for the meeting to gain agreement, gain signatures, and discuss terms and conditions. The format for the Proposal Presentation Meeting reflects the First Structured Qualifying Meeting needs, hurts, and business objectives in a manner that positions the solution.

Here is that specific format for the Proposal Presentation stage of the sales process and set of documents that would generally will included:

• Executive summary
• Maintenance objectives
• Equipment list (any photos)
• Recommendations
• Contract documents
• Terms and conditions
• Benefit statements

We want to follow a specific format or agenda as mentioned above, so that we discuss the pain and needs that were uncovered in the First Structured Meeting and throughout the survey or building assessment. We want to make certain that there is documentation related to the business objectives or building management goals that will be incorporated into this proposal presentation “hybrid.” The format or agenda for the meeting and the physical composition of the proposal-presentation hybrid should align completely.

Benefit statements should be listed in an overview in the executive summary, as well as presented in bullet form throughout the document. We continue to remind the prospect, in writing and verbally, that we are “covering all the bases” and “taking their pain away.” The maintenance objectives or list of requirements that we have derived from our interviews and survey (building performance assessment), would accompany the equipment list, photos, and any other recommendations “bundled” with the maintenance agreement. The recommendations section would also include any financial justification discussed in our last article and include the building ownership and operating cost analysis.

The contract documents would follow the recommendations and financial analysis and would also include the terms and conditions, possible information on financing and leasing, and any other safety/compliance information if project work is included with the maintenance agreement. Benefit statements listed in bullet form at the conclusion of the proposal-presentation reminds us to reinforce the reasons why the prospect should be doing business with us!

The presentation of this final proposal and any PowerPoint presentation developed should make this on of the most enjoyable meetings with the prospect, especially if we have “negotiated the deal” during the more informal Confirmation-Verification Meeting discussed in our last article…so have fun! For more information on proposal-presentations, examples, and sample documents please reach out to me or the ACCA. Have fun, close more sales!

The post Commercial Service Sales Presenting Recommendations appeared first on IE3: Indoor Environment & Energy Efficiency.

There are big companies, small companies, and ‘right-sized’ companies. Mechanical Systems Inc. can definitely call themselves a ‘right-sized’ company.

They’ve been in business for 20 years, and although they only have a staff of 25, the $10 million in revenue they earn annually places them in direct competition with companies two, even three times their size.

Thomas Hooper Sr. established the first generation of his family-owned & operated business in 1979, and with the desire to carry on the family atmosphere and culture to the second generation MSI was formed in 1995.

Today, Thomas’ son Brian Hooper is the VP of Operations, and credits his dad with building the solid foundation upon which the company has found success.

At the root of that success is the company’s core value system, which can be summed up in one word – attitude. At MSI, the positive attitude is the only one to have, and there’s certainly no room for negotiation on that.

“I can train you if you don’t have the knowledge,” Brian Hooper said. “But I can’t train you if you have a bad attitude, because those are almost always impossible to break.”

TRAINING FROM THE FOUNDATION UP
Brian believes in a bottom up approach for training staff members, recruiting many of their new employees from high schools, and training them from the very beginning.

“We’ll interview high school students in September, and we usually hire one or two a year,” he said. “We train them from September all the way through to May with the goal of offering a full-time position upon graduation.”

After four of five years of experience working with the company as a maintenance technician they must commence more in-depth 10- to- 30-hour Occupational Safety and Health courses. Then it’s off to night school two nights a week for two and a half years, followed by field training and job shadowing with experienced MSI service technicians.

Because the company is small, they rely mostly on outside sources to train their staff, like local community colleges and the local chapter of the Associated Builders and Contractors but invest heavily to ensure the training is extensive, thorough and results in well-rounded employees.

ATTRACTING YOUNG PEOPLE TO THE INDUSTRY
With widespread concerns about the shortage of young people coming into the industry, MSI’s approach to training means it’s a problem they’ve avoided. But as Brian shares, it’s not as simple as going into any high school to seek out new talent. The company has a tried and tested strategy that ensures their youth recruitment program is a success.

“We looked at who our number one customer is and for us this company is located in Hopkinton, Massachusetts. We do about 20 of their buildings,” Hooper said. “Because the only way you can hire a high school student is to make sure they stay where they live.”

“Having a customer with at least 10 to 15 buildings your company does work for enables you to hire a student from a local high school co-op program,” Brian added. “And the proximity of the student’s home to the customer’s locations makes commuting easy, and a necessity if they do not own a vehicle.”

Training commences immediately, and before students hit the eight-month mark, three things become clear, Brian said. “You’ll know if that student is someone who, number one, can learn, and is teachable; number two, has the right attitude to want to learn; and number three, wants to do this for a career,” he said.

Under the co-op program the students alternate between a 40- hour work week at MSI which they get paid for, and a normal school week.

MSI has been running its School to Career Co-op Program for over a decade and would like to expand the same program throughout existing New Hampshire School Co-op programs. Through the program they have hired eight full-time students, and to date, approximately half of MSI’s employees are 26 years old, or younger. A key element of the co-op program is that it enables students who otherwise thought they wouldn’t be interested in a HVAC career to see what it actually entails, therefore allowing them to make a more informed decision for their future.

MSI IN FIVE YEARS
Three goals top the list of things to be achieved over the next five years. The first is to implement technological upgrades, including going paperless.

“My internal staff spends a majority of their time chasing down paperwork,” Brian said. “We are in the process of moving all our files and contracts to the cloud. Every single MSI employee will have an iPad. All our employees will be using a barcode system to track any equipment we service or maintain. The GPS tracking system which we are also implementing will make it easier for all our technicians to get to our customer locations and they will make it easier for the customers to keep track of where we are for their needs. The company has been working over the past six to eight months to implement this new transition, and we expect to have it fully launched by the end of 2016. It is a significant financial investment but a necessary one for any company that has a desire to move forward in the future and be in the cutting edge of technology.”

MSI’s second goal is to ramp up efforts to get the next generation of workers into the trades. Efforts to expand their School to Career Program are currently underway, and Brian hopes to have a New Hampshire School to Career Co-op Program up and running within a year.

ADVICE TO THEIR PEERS
Brian’s advice to other contractors is to join a peer group. “I think your peers can really open your eyes on how you compare your company to theirs,” he said. “They point out things that maybe you don’t want to hear, and they show weaknesses in your company that you may not even know you have. Whatever your company’s weakness, you’ve got to be open to constructive criticism, and you must be willing to make the necessary changes that will lead to success.”

One of MSI’s weak points was their lack of community involvement. MSI financially supported many local charities but they weren’t often rolling up their sleeves and getting engaged in with community. This quickly changed once they heard this feedback from their peer group.

“We weren’t really getting involved with anything that didn’t have to do with our industry,” Brian said. “I think that if you want to be one of the best companies, not just in your region, but in the country…you’ve got to be a well-rounded company.”

That was eight years ago. Today, MSI can certainly say that they are well-rounded, by being involved with more than a dozen non-profit organizations. But, one of their passions is helping local Veterans, and the best example of that is Building Dreams for Marines which is a non-profit Brian co-founded.

Building Dreams for Marine’s mission is to retrofit the homes of disabled Marines at no cost to the them or their families. In just three short years, the organization has renovated ten homes for local Marines and their families.

Now that Brian has taken full responsibility of running the day-to-day operations of MSI Mechanical he is clear about one thing; none of it would be possible without his father and family’s support.

“My father is the one who got it all started,” Brian said proudly. “And without the strong foundation he built, we wouldn’t be here. So I just want to take a moment to acknowledge and give credit to my Dad for teaching, and mentoring me,” he said.

The post More Than Profit Needed To Claim HVAC Success appeared first on IE3: Indoor Environment & Energy Efficiency.

To land educational institutions as customers, do your homework and follow their rules.

With approximately 130,000 K-12 schools in the United States, according to the National Center for Education Statistics, plus more than 4,000 colleges and universities, the education market offers plenty of business opportunities for HVAC contractors. Cracking that market, however, take a bit of time and extra effort.

“Getting into schools is more difficult and time consuming than your average customer acquisition process,” says Sam DeAngelis, chief executive officer of Colorado Climate Maintenance, Inc., in Englewood, CO. “The type of work you do in schools isn’t anything unusual, but the back-end, administrative side is a challenge, especially in the beginning.”

A referral prompted Colorado Climate Maintenance to bid on its first school project about nine years ago. The job was straightforward—a $3,000 unit replacement—but landing it was anything but. First, to become an authorized vendor, the company needed to file paperwork and obtain a certificate of insurance in the school’s preferred format. More problematic, DeAngelis says, was figuring out who reports to whom in what can be a school district’s convoluted organizational structure.

“Finding out who the real customer is—and who all the supporting players are—is more difficult compared to other commercial applications, where you have a definite owner or property manager and management structure,” he notes. Depending on the state, the district, the school, and the type of HVAC work, decisions makers may include maintenance janitors, school supervisors, facilities managers, purchasing agents in central administrative offices, district treasurers, and even the school board itself.

Colorado Climate Maintenance relies on its software system to track who makes the decision on what type of job, who solicits bids, and who should receive the invoice—all of whom may be different people—in the 22 public schools it works in. All the schools are in the same district, one of Denver’s largest, which has its own maintenance staff.

“Many times, their maintenance people diagnose the problem, but call us because they don’t have the time, manpower, or equipment to replace something—or they get stuck on a problem,” explains DeAngelis. “Our goal is to have the school district look at us an as extension of their staff—so they contact us whenever they need support, whatever the need is.”

How to Make the Grade
In addition to performing service work, Gundlach Sheet Metal Works, Inc., headquartered in Sandusky, OH, has taken on design-build and plan-and-spec projects for several K-12 school systems. For both new construction and retrofits, Gundlach Sheet Metal typically works with a district’s architect and/or engineer as well as a construction manager. Many schools also involve environmental consultants or certified Leadership in Energy Efficiency and Design (LEED) inspectors, as part of a commitment to greener, more efficient facilities. Doing so adds complexity to projects and pressures contractors to know the specifications—and their attendant costs—backward and forward.

For instance, “You have to be open to meeting all the LEED requirements, such as keeping ductwork clean, storing it properly, and keeping it sealed during the entire project,” explains Roger Gundlach, the company’s president. “Also, there may be criteria related to the percentage of products purchased from U.S. manufacturers, and you may have to wash all the coils and change the filters before you turn the building over.”

Nationwide, construction and retrofit work is becoming plentiful because the Department of Energy estimates the average age of a U.S. school at 45 years—old enough to need replacement or significant upgrading. According to the 20th Annual School Construction Report, issued in 2015 by School Planning & Management, school districts in the United States spent more than $14 billion on construction projects during 2014 alone. More than half (55%) of that total went for new construction, while $3.14 billion was devoted to retrofitting and modernization of existing buildings. HVAC systems top the list of components most often upgraded when elementary and middle schools are modernized and rank second for high schools.

Here are some tips for moving into the education market:

Pick and choose carefully. Identify school projects that fit with how you already do business. Colorado Climate, for example, focuses on service, maintenance, and replacement work; it avoids big projects that involve construction and remodeling because it doesn’t operate in that market niche. Adds Sam DeAngelis, “We also decided not to pursue work in another nearby school district because the research we did indicates that district doesn’t fit our customer profile.”

Gundlach Sheet Metal likes bidding on school projects where it can serve as the prime HVAC contractor or those that require fabrication of sheet metal—one of the diversified company’s specialties. “Retrofit projects where we can do all the automation systems, equipment replacements, and upgrades really suit how we do business,” notes Roger Gundlach. “We also like projects where, when the work is done, we can become the school’s service contractor.”

On the flip side, the company avoids schools that require three bids on all service work, no matter how easy or complicated. “We don’t want to waste our time with schools that look only at the bottom line—we want customers we can form a relationship with,” says Gundlach.

Do your legwork. Colorado Climate Maintenance’s salespeople track changes in school district personnel and monitor overall operations. They know, for example, the spending threshold above which a project must be competitively bid; that enables the firm to divide a project into smaller, less expensive phases at the customer’s request.

In addition, they must know the in-service days, holiday breaks, and summer vacations, when a school district often schedules HVAC work to avoid disrupting classes. “We also stay on top of the district’s budgeting process and cycle, so we can provide estimates for possible action items,” adds DeAngelis. “Maybe 25 percent of those estimates will actually get into a budget, but for those that do the district knows who to call.”

Carefully read the paperwork. “Either because of their own rules or state laws, school systems generally have very detailed plans, specifications, and schedules that have to be met,” says Gundlach. “If you bid on school construction, go into it with your eyes open, knowing that many people will be examining your bids, your work, and your bills.” That translates into abiding by all the rules for bidding, submitting AIA forms correctly and on time, completing work on schedule, and following the sometimes arcane procedures for getting paid.

Be patient. Like most bureaucracies, school systems tend to favor a paperwork-heavy, hurry-up-and-wait approach to working with contractors. After being selected for a job, you might wait weeks or even months before being able to perform the work; after completion, a month or so may pass before all the right people have signed off on your invoice.

You may wait much longer for payment on construction and retrofit projects, warns Gundlach. On most large school projects, “It takes at least a year to get all your retainage. Of course, if you and the other contractors all do a really good job and get the punch lists done on time, the timeline can be much faster,” he says.

“Schools are like your worst customer and your best customer at the same time,” concludes DeAngelis. For example, they may request a large number of bids at the same time, for budgeting purposes, then let months pass before deciding which projects to pursue.

On the other hand, service and repair work can be consistent and noncompetitive when you’ve developed a relationship with the decision makers. As Gundlach says, “Like any customer that has a good experience with your company and service techs, schools will continue to call you when you take care of their problems through quality service.”

The post School Projects appeared first on IE3: Indoor Environment & Energy Efficiency.

Are you and your sales team listening…really listening? By questioning and listening to close sales means that you take the prospect seriously and that we are taken seriously. Do you believe your prospects and customers want to be listened to? Do you believe that your prospects and customers want to be taken seriously? Ideas, thoughts, feelings, and even how we purchase become known through questioning and listening. Ultimately what we have to say and what our prospects and customers have to say really matters. Questioning and listening are key to closing sales!

We learn about our culture, primarily through listening. We learn to think by listening, we learn to care by listening, we learn to love by listening, we learn about ourselves by listening, and we learn about our customers through listening. Most people will not care about your point of view or what you have to say until you’ve heard and appreciate their point of view. Therefore, the first stage in a sales relationship should include active listening. So, why do we as contractors spend so much time talking about our company, ourselves, our technical expertise, and offerings? Questioning and listening should dominate the conversations from the first structured meeting though surveying or performing a building assessment, through the confirmation stage and especially when we close the sale.

Let’s talk about questioning, listening, and qualifying in the context of customer relationships. We begin by understanding that we should be listening twice as much as we speak in the early stages of selling. We ask questions about the person’s business facility and about concerns they have related to heating and cooling. We should be asking questions about the financial impact HVACR problems have on their business. We respect their opinion and how they make a purchasing decision by asking questions related to how things might move forward.

Early questioning and listening with a client or potential customer should be focused on the concerns they have, how they work and utilize their building, what issues exist related to the environmental systems, why these are concerns, how this happens? We earn the right to ask questions about how decisions are made, how much can they afford to pay, and when they would purchase by asking the ‘broad’, ‘open-ended’ questions related to how they operate their business and operate and maintain their HVACR.

How can we help and serve our customers or make them look good or feel more comfortable? This is the area where active, complete listening becomes very critical. Early in the relationship, the fact that we are truly interested in serving them, means that we ask great questions in order to listen more thoroughly to why, how, and when the prospect will buy. A solid relationship is founded in communications, combined with commitments made and then fulfilled. What communications? What commitments? How are we going to help or serve our customers? Here, we find the critical nature of good questioning and active listening.

Let’s start all of our customer relationships by being good listeners, by asking great questions, and by helping prioritize the needs, hurts, and objectives of the prospect. Let’s complete the sales process by being great listeners while we confirm pain, reinforce benefits, and illustrate financial justification. Good questioning and listening requires the following:

• Have meeting goals; prepare your questions in advance
• Use open-ended questions, always probe further in a specific area
• Don’t double your questions, ask one at a time
• Take notes to log information and ‘park’ your thoughts or further questions
• Ask questions about their work or home, issues and concerns related to the environmental systems or HVACR, impact systems have on their budget
• Earn the right to ask questions about how they buy, what they can afford, how they would pay, and when they would purchase
• Show empathy, lean forward toward the prospect, don’t interrupt
• Listen for needs, hurts, and objectives in order to educate or discuss specific options
• Only relay information that incorporates how you will serve them
• Use “Explain that to me”, “Tell me more about that”, “Describe how that happened”.

Listening combined with great questions means that we should listen twice as much as we speak. Focus on your objective in the early stages of the sales process; gaining knowledge about their needs, hurts, and objectives in order to better serve our customers. If the close is the logical conclusion to a great sales process then questioning and listening are the keys to navigating the sales process!

Do you want to build long-term, strong, high margin relationships with your customers? Do you desire the “auto close” for your negotiated maintenance agreements and commercial service projects? Start by beginning every sales process or sales appointment meeting with well-planned questions and learn to become a great listener by probing well. Start today by preparing the questions you will ask in your next sales visit. Questioning and listening skills can change your customer relationships, internal business communications and family relationships.

The post Questioning, Listening to Close the Sale appeared first on IE3: Indoor Environment & Energy Efficiency.

Unique challenges surround HVAC work in eating and drinking establishments.

Based on the National Restaurant Association’s calculations, you’ll find more than 1 million restaurant locations throughout the United States—a sizable potential market for commercial repair and maintenance services. Restaurants and bars, however, are not your average commercial customers.

“Restaurants have a lot of equipment, in a small space, that gets a lot of use and is treated pretty rough,” says Karim Nice, president of Blue Hat Mechanical in Apex, NC. “We definitely visit them more often than office buildings, and they have more service work per location than other types of businesses.”

Much of that service work stems from the greasy exhaust emitted by fryers and cooktops, which gets pulled into air conditioners. “We need to do a lot more coil cleanings, compared to other customers, and it can take a substantial effort to get those coils degreased if we’re working on the roof,” adds Nice, whose firm does more than half of its business in restaurants and bars.

Aside from the greasy work that’s often involved, working in the restaurant space will affect your business in several areas:

Health inspections
The ability to open or continue operating a restaurant depends on passing regular inspections by the local public health department. Although local laws will dictate the frequency and focal points of such visits, in general health inspectors want to ensure safe food handling procedures are being followed.

“That means cleanliness of the equipment is a huge issue,” says Brad Taback, president of Climatech in Pittsburgh, PA. “The technicians always have to be thinking about the end consumer, even though that’s not your direct customer. The restaurants’ patrons can ultimately be affected by the work you do.”

Refrigeration also plays a big role in health inspections, says Nice, because walk-in coolers and freezers must operate at temperatures that maintain a safe food inventory. He adds, “Restaurants often get flagged in health inspection reports for things like torn gaskets, rusty shelves, or doors that don’t close properly, so we address those things, too. It’s not super-technical work but it needs to be done to pass inspection.”

Blue Hat Mechanical, in fact, encourages its restaurant customers to snap and e-mail a photo of their health inspection report. That way, the company’s technicians can ensure they have all the needed parts on the truck and make all the required repairs in one economical trip.

Scheduling
Most restaurants serve lunch and dinner and, for both health and safety reasons, don’t want a technician cleaning fan coils or repairing the evaporator in the walk-in cooler while food is being prepared. Even when they remodel, restaurants typically don’t want to risk losing business by closing down. As a result, much of their HVACR work must happen outside the 8-to-5 schedule often favored by other commercial customers.

“It’s tough on staffing when you have to schedule people to work from midnight to 7 or 8 in the morning, but that’s how the restaurant industry works,” notes Taback, whose firm often remodels restaurants after hours. “It’s more difficult and time consuming, because you have to clean up every night so the restaurant looks like nobody was there.”

Adds Nice, “Fast food restaurants open 24 hours a day are an especially big challenge, because they’re busy all the time, even in the middle of the night.”

And, while timely repair service is important to all customers, any delay could threaten a restaurant’s livelihood. “It’s important to respond quickly to any emergency,” Taback observes. “If you have a cooler or freezer that’s down, the product can spoil if the temperature gets below a certain level and cost the restaurant a lot of money.”

Training and experience
Given the many brands and types of restaurant equipment—from small under-counter refrigerators to large freezers and ice machines—knowing how to service them all takes the expertise born of at least 15 years of experience. “It’s not trivial to make the leap from working in HVAC to refrigeration,” says Nice. “And you can’t have people learning on the job because restaurants really won’t be happy if it takes three trips to fix their ice machine.”

Experience also comes into play in solving the issues that often bedevil eating establishments, such as preventing food odors from seeping into eating areas. Make-up air must be introduced into restaurants to replace the heavy exhaust from griddles, dishwashers, and other equipment in commercial kitchens.

“It’s a science to get a restaurant balanced properly so you can maintain a slightly negative kitchen, to keep odors in, but not affect the comfort of the patrons,” Taback says. “You need trained technicians who really understand what they’re doing—and that takes time and experience.”

Decision makers
Both Blue Hat Mechanical and Climatech work with individual establishments, local franchisees of national fast-food restaurants, and regional chain locations. Figuring out—and marketing to—the appropriate person in each type of restaurant can take some detective work. For example, says Nice, fast-food restaurants may have numerous managers who move between locations; the person placing the service call may not even work at the location in question.

In Nice’s experience, restaurant chains tend to use facilities management firms, which add an extra layer of paperwork and bureaucracy to vendor selection, scheduling, and payment. The firms often require HVAC firms to work for a set hourly rate and might cap pricing for parts and refrigerant. Also, says Nice, “Because their business model is to get paid by the restaurant before they pay us, the payment terms often stretch to 60 days or more.” On the other hand, becoming a preferred vendor for a facilities management firm can lead to more business with its other restaurant clients.

While it’s much easier to identify the decision maker in owner-operated establishments, such mom-and-pops are often reluctant to spend money on regular maintenance and even some repairs, says Nice—particularly if they are start-up operations and leasing space. “Owner-owned restaurants are especially sensitive to every invoice and want to know why it takes you so long to do something,” he observes.

“The restaurant industry has a fairly high failure rate, so do some research first—make sure the restaurant is financially solid and pays its bills on time,” advises Taback. “There are plenty of bars and restaurants where the doors shut before you know what happened.”

In fact, research conducted by Cornell University and The Ohio State University indicates that about 30 percent of restaurants close each year, with a failure rate between 50 and 60 percent within the first three years; the smallest restaurants have the highest failure rate overall. Blue Hat Mechanical, which has had some restaurant customers go bankrupt, now asks for a credit card before doing work for mom-and-pop restaurants; it extends credit to those that pay their bills regularly for at least six months.

The good news is that restauranteurs are good networkers. Taback says, “If you do a good job for someone, they’ll probably pass your name along to other owners. Customer referrals are one of our two main sources of getting business.”

If a restaurant succeeds, that business relationship can continue for many years. Just ask Brad Taback: Climatech has been providing HVAC services to one regional restaurant chain based in western Pennsylvania for the last 30 years.

While there are some challenges with working in restaurants, it’s definitely a market that can pay big dividends through relationship building. By following the advice from these top contractors, and proceeding with care you can find success in this market.

The post Restaurant Service appeared first on IE3: Indoor Environment & Energy Efficiency.

The Geothermal residential tax incentive is a 30 percent installation credit afforded to a residential energy-efficient property. Currently, it allows consumers to spread this credit out over the course of several years, but systems installed in 2016 will have one year to use up the credits. This credit allowed the use of this technology to thrive during the 2008 recession, but is now set to expire December 31, 2016. While other areas in renewable energy, such as solar, have already received an extension to this tax credit until 2020, the geothermal industry, at this time, has not.

This is, in part, due to the haste with which the tax extenders package was put together. The House of Representatives Ways and Means Committee failed to account for geothermal in their bill. Though promises have been made to ACCA to rectify this issue, no tax vehicles have moved to allow for its inclusion.

This begs the question: if this incentive is not renewed, what does this mean for the geothermal industry and what will the industry do next?

It is important to understand that this credit given to the geothermal industry in 2008 came at a time of a significant national recession. This tax credit helped the industry keep afloat during a time when construction was at a dramatic low, but the industry was not able to use it as optimally as it was intended to be used. Now that the economy is starting to turn around, the geothermal industry has the opportunity to receive the fully intended impact of the tax incentive.

Tim Litton, director of marketing communications at WaterFurnace Intl. in Fort Wayne, IN, states, “The tax credit allowed us to maintain sales during a challenging environment – but it didn’t expand the market. That’s why we’re pushing for an extension to the credit, in the hopes that the credit will help us grow the market in a strengthening economy.”

What Do The Experts Believe?
Even though some are quite confident in the renewal or extension of this tax credit (and some lobbyists are continuously working to make this happen), not everyone believes a renewal or extension will occur. While Litton remains “cautiously optimistic the tax credit can still be extended,” Jeff Persons, owner of Geo Source One in Dublin, OH, does not think the credit will renew, because “the people in Congress are focused on solar resources. When the 2008 renewal happened, it was behind closed doors and many things were cut from the credit. Lobbyists from the geothermal industry were not able to attend.”

Along with depressed profits, companies within the geothermal industry could experience some other immediate effects in its workforce and business structures. Persons indicates that “when the credits go away, installation crews will be laid off or go parttime. Manufacturers will cut back to single or partial shifts, which translate to layoffs. Once the credits are gone, that market disappears until something happens in the energy cycle to re-stimulate the industry and sales.”

While the expectation would be a drop in sales of geothermal products if the credit is allowed to expire, there are some industry experts that predict that the geothermal market would rebound within an average of two years, as has been historically the case in areas similarly affected within this industry.

Litton notes that there may be a significant benefit to its expiration as well, as it would allow the industry to re-establish a higher level of integrity. “So many contractors started offering geothermal heat pumps in response to the incentive,” he says. “Unfortunately, a number of them did not take the time to receive proper training and left their customers with problem installations. Many homeowners blamed the technology when it was more often installation issues. If the incentive expires, the industry will balance itself and weed out the contractors that were simply trying to pick low-hanging fruit. This market correction should effectively increase market shares for the dedicated contractors who are committed to the technology.”

Even though the industry would see dips in profits and would have to find ways to sustain upon the incentive’s expiration, the market will likely rebound for this technology. The long term effects can prove valuable, too, in allowing the consumer to better see and understand the value of this technology and to be better served with product reliability.

There are also some industry experts who believe it may be time to phase out the credits, as it falsely stimulates consumer purchase. Consumers are holding off on purchasing until they know the credits will remain in effect. This can create a large fluctuation in consumer activity, which can have a destabilizing effect in this market, since it is still developing. Plus, these tax credits will likely end at some point, which has some wondering if it is it better for the industry in the long run to end them now or in four years from now?

Still, it is preferable to many to renew this tax credit, so contractors can take better advantage of a strengthening economy in casting a much wider net in their consumer base and in expanding the exposure and use of this technology.

And If The Credits Do Expire?
Even if there is Congressional appetite to renew this credit, experts within the geothermal industry and manufacturing are already making preparations in the event that this tax credit does expire at year’s end. Litton says, “Our plan is to provide our dealers with everything they need to succeed without an incentive. This includes new, innovative products that are attractive to consumers; a range of easy financing options; business and sales training for our customers; national advertising support; and top notch 24/7 technical support.”

Litton goes on to say, “The technology makes sense with, or without, a credit. That being said, we are also expanding our products to areas not so affected by tax credits –commercial and industrial markets. We are assessing technologies that reach outside geothermal heat pumps, but align with our unique skills and expertise.”

While some companies may revert back to working with more conventional systems, some others may find that they need to consider merging with another company to reduce their costs and optimize their resources to remain competitive in the geothermal industry. Persons says that some companies should “look into what other companies you can merge with. Merging companies will reduce overhead costs while making better use of existing assets.”

Thinking About The Way Ahead
Though the technology is incredible, the geothermal industry has had to contend ith some significant hurdles to industry development and sales continuity. Persons says, “Survival post-2016 will once again need to focus on service until an economic/energy price differential occurs to provide the needed market incentive to make a change. That is where I anticipate things will start to head post-2020, once the Fracking Surplus is substantially reduced.”

When considering all the benefits geothermal provides, the longevity and strength of the industry’s outlook remains high. Litton indicates that WaterFurnace is confident the industry will “eventually rebound due to the numerous benefits of geothermal that have nothing to do with a tax credit. Many of WaterFurnace’s fastest growing years occurred just before the tax incentive was implemented.”

However, with the sense of urgency currently surrounding subject matter experts in the geothermal industry as it pertains to these credits, it is worth investigating deeper who should focus on incentive development. Meaning, does the decision making power for the biggest benefits of this tax credit have to remain at the Federal level, or can a credit of some sort be negotiated or re-negotiated at the state level to offset the costs associated with not having any incentive at all?

Most states already have incentives and/or rebates in place for renewable energies. An “at a glance” look can be found on the Database of State Incentives for Renewables and Efficiency website, at www.dsireusa.org, along with when the incentive or rebate was last updated.

If the states, themselves, would be willing to work further with manufacturers, research and development teams, and other industry-affiliated companies to greater incentivize the industry beyond what it is now, the effects may not be as grand as 30 percent at first, but they could be longer lasting and co-beneficial.

ACCA is closely watching the geothermal tax credit and working to get it extended. However, there is no guarantee that this will happen prior to their expiration, as the industry has seen this happen many times before with other tax credits.

If you have questions about the geothermal tax credit please contact Barton James, ACCA’s senior vice president of government affairs at barton.james@acca.org.

The post Expiring Geothermal Tax Credits: What Will the Industry Do? appeared first on IE3: Indoor Environment & Energy Efficiency.

Every successful sales person knows the power of great questions! When a thorough and comprehensive sales process and direct marketing approach are utilized we have the opportunity to cover prospect’s needs, completely resolve the “hurt,” and help achieve business objectives. If we fail to differentiate and shorten the sales process to “meet,” “survey,” and “quote” we are trapped in “price only” discussions and never have the opportunity to negotiate. Questioning early in the sales process to understand the specific mechanical needs, the hurt, or pain experienced with HVACR problems, and the overall business objectives that prospects desire help us move toward a negotiation.

Let’s describe what we mean by the “needs”, “hurts,” and “objectives.” First, every building has the need for our equipment in order to operate or meet code compliance. The building needs HVACR, the systems, equipment, controls, all components, and parts to satisfy the load requirements. The needs are related directly to the type of mechanical and electrical systems, as well as controls and we should be aware of what certain buildings need and the type of systems that are typical. We determine these systems and components and list them out in the initial survey or review of scope of work for selling maintenance or projects. Pictures, plans, sketches, and simple drawings may help the sales person describe in detail what currently exists in the building.

The second area of questioning is related to the building “need” or systems, but now focus on the problems that exist, or the “hurt.” The pain or hurt that exists for the building owner, manager, or occupants related to the HVACR will be the primary and emotional foundation for the sale. Pain comes in many forms; poor design, poor installation, neglected HVACR equipment, dirty, filthy systems and components, old or aged systems, and the fact that rooms or zones have been changed over time. The pain is the discomfort, increased energy costs, escalating repair costs, the hassle, the constant emergency situations, or breakdowns. Illustrating pain and producing documents that provide related benefit statements, as well as solutions that resolve pain give us the opportunity to negotiate our recommendations and close the sale.

However, there is one more area that needs to be considered for sales people that use great questions and know how to draw out the prospect in any First Structured Meeting or interview. That third area is the area of business objectives and the financial considerations of the solution. Our proposals for maintenance and projects should have financial justification provided and/or “simple benchmarking” to illustrate how our solutions and recommendations satisfy not only the needs and the pain, but cover the business objectives, financial considerations, and budget for the prospect. Understanding business objectives also means that the sales person thoroughly understands how a recommendation would be approved and who may be involved from the prospect’s organization. The process the business uses to approve recommendations and how those decisions are made are critical to negotiating with the right person to close sales.

One of the benefits for the sales person as we ask questions about the way our recommendations would be approved, or the process the prospect uses, means that we may be asked to meet with those higher levels of management. Also, as we ask questions about the business objectives and budget, we will be directed to the financial decision makers many times. Start asking questions that are related to fiduciary responsibilities and you may just be directed or introduced to the financial decision makers and higher levels of executives or managers in that organization.

We had talked about levels of questioning in a previous article, as we moved through the sales process, and invite you to learn about these levels of questioning. Essentially, if you combine great questioning about the needs, pain and business objectives with the four levels of questioning, you have a fantastic format for interviewing prospects in that First Structured Meeting and throughout the sales process! The four levels of questioning are as follows:

Level 1: Questions related to the prospect’s business, responsibilities, locations, ownership, amount of time with the organization, background and any “ice breakers” related to building the relationship.

Level 2: Questions that relate to the building HVACR and the impact that the HVACR have on his or her daily responsibilities. The impact the HVACR have on the business and operations.

Level 3: We now introduce questions about the budget and the financial impact that the HVACR have on the business including utilities, repairs, major component replacement, labor, and how they budget for HVACR expenses.

Level 4: Now the sales person has ‘earned the right’ to ask closing questions! The questions near the end of the first structured meeting or end of the sale process would include questions about how the recommendations would be approved and how a proposal gets approved and signed to move forward.

When we combine the elements of a thorough sales process with target direct marketing, great questions and understanding the needs, hurts and objectives of the prospect, we increase our probability of close substantially! Just ask those successful sales people you know in any industry and those consistent closers in the HVACR industry!

The post Commercial Service Sales: Discovering The Needs, Hurts, & Objectives appeared first on IE3: Indoor Environment & Energy Efficiency.

Commercial building controls can play a pivotal role in maximizing the efficiency of HVAC systems. Nonetheless, commercial building controls are often viewed as cost prohibitive for buildings smaller than 5,000 to 10,000 square feet. One reason: in the past, commercial building control systems were custom built. A controls contractor was required for installation, which also drove up costs. In fact, only about 5 percent of smaller buildings typically utilize building controls, according to Chad Senger, Product Development Manager for Systems and Controls for Daikin Applied headquarters in Minneapolis, MN.

“People ask themselves How long will it take to pay off this investment?” Senger said.

Larry Weber, General Manager of Building Control Systems for Honeywell International, located in Minneapolis, MN, agreed, adding that balancing cost and comfort is an ongoing challenge for building owners and contractors.

“Comfort and energy efficiency are on opposite ends of the scale,” Weber said.

Reduced Costs
Preprogrammed systems largely eliminate the need for a controls contractor, making it more advantageous for contractors to integrate building controls into smaller buildings. Many commercial building control systems also implement intelligent equipment that communicates directly to the cloud, much like garage door openers that operate via Wi-Fi and can be controlled via mobile device, according to Senger

The advantages are significant. Commercial buildings with control systems have 10 to 15 percent lower energy costs than comparable buildings without them. Building control systems can also maximize the comfort of building occupants. For instance, anyone who has ever struggled to stay awake during a meeting conducted in a stuffy room understands that poor ventilation can have an adverse effect on productivity. However, a commercial building control system can be programmed to send a signal to start a Demand Controlled Ventilation (DCV) system when CO2 levels get too high. The result – less stuffiness and drowsiness – without the need to open the door for fresh air, according to Weber.

“At certain CO2 levels, you start to feel less attentive,” Weber said.

Without commercial building controls, buildings such as courthouses that experience high occupancy diversity often operate HVAC systems on schedules that don’t necessarily coincide with occupancy patterns. Some owners or tenants even resort to “just in case” scheduling for HVAC systems – placing systems in full operation during all hours that the building could possibly be occupied, often resulting in tremendous energy waste.

Integrating building control systems into HVAC operations in buildings with high occupancy diversity can eliminate such waste, according to Senger.
“If nobody’s in there don’t bring any (heating, cooling or ventilation) in,” Senger said.

Weber agreed, adding that commercial building controls can help to maintain comfort levels for occupied spaces, while setting back temperature controls for less used spaces,

“Controls can figure how long you need to run equipment to maintain comfort,” Weber said.

Many contractors also have service agreements with their clients, at least for the first year after the conclusion of the job. Installing building control systems with remote access can greatly reduce the expense associated with carrying out those agreements, according to Senger.

“They make more money if they don’t have to run out to the job site constantly,” Senger said.

Packaged commercial building control systems also provide peace of mind for contractors and building owners or tenants alike. That’s because packaged systems are designed to work together, rather than assembled from separate sources, and are therefore more likely to operate properly, according to Senger.

“Systems sourced separately can lead to finger pointing and withheld payments,” Senger said.

In addition, integrating commercial building control systems into HVAC systems can also facilitate compliance with government regulations such as Title 24 (California) and commercial building standards such as those from ASHRAE and LEED. Integration of commercial building controls into HVAC also helps maintain high performance standards, according to Senger.

“They build better buildings,” Senger said.

Making HVAC Systems Work Better
Building controls integrated into a well-designed HVAC system can enhance optimal performance (with minimal waste) while maintaining consistently comfortable indoor conditions. Integrating commercial building controls can also address many challenges associated with maintaining indoor comfort, although they cannot completely compensate for poor design and installation. For instance, poorly designed system HVAC systems must often run much longer than well-designed systems to maintain consistent air temperatures. introducing building controls can mitigate (but not eliminate) waste by ensuring that systems run only as long as needed, accounting for the associated inefficiency, Weber explained.

“Controls can do a lot, but they can’t do everything,” Weber said.

Likewise, retrofits represent a challenge for operating efficient HVAC systems. Prepackaged building control systems are almost never adequate. One cost-efficient solution for retrofits is to install a central control with communicating thermostats for each room integrated into the interface accessible by a mobile device or laptop, according to Senger.

Enhancing the Bottom Line
Integrating commercial building controls can also improve a contractor’s bottom line. Buildings with building controls earn more LEED points and command higher rates. In addition, customers are more likely to view buildings with control systems as being higher quality, with the contractors benefitting by gaining repeat business, according to Senger.

“A happy customer is a customer that returns,” Senger said.

The post Get Control of the Building appeared first on IE3: Indoor Environment & Energy Efficiency.

Expanding population.

Codes and regulations.

Connectivity and monitoring.

These trends are directly impacting the HVAC/R equipment requirements and market growth. More equipment is needed for new project construction, required retrofits, and building expansions. Just because more or new equipment is required doesn’t always mean that the total cost of ownership has to increase. This is where energy efficiency plays a huge role – and it has never been more important.

Variable frequency drives (VFDs) have been a vehicle for improving a systems energy efficiency for over 40 years. A standard VFD controls a motor based on a linear volts per hertz (V/Hz) relationship. The output voltage waveform of a standard VFD is typically based on pulse-width modulation (PWM). The amplitude, duty cycle, and periodicity of the PWM waveform decide the effective voltage and frequency of the VFD output.

However, this isn’t enough anymore, especially for fan and pump motors in HVAC/R applications or variable torque applications. In these applications, the speed of the motor is reacting to external sources that are a part of the overall system. These external sources could be a temperature sensor in a refrigeration system at a grocery store, a humidity sensor in a data center facility or a pressure sensor monitoring the room pressure in a clean room. A VFD uses the external sources as input data to adjust the output frequency to the motor, in turn, adjusting the speed of the motor. In these applications, there are advantages to varying speed rather than running at 60Hz, full load amps, at all times.
Below are 3 additional considerations to reduce energy costs and become more energy efficient.

Energy optimization software
As mentioned above, a standard VFD modulates the output voltage waveform to adjust the output frequency. With new technologies in current VFDs, more can be done to optimize the energy consumption in variable torque applications than just standard Voltz per Hertz control. Many VFDs have optimization parameters that can be used to tune the input power consumption while maintaining the load’s torque or speed demand. However, some VFDs have built-in algorithms that can conduct the tuning and monitoring automatically. Eaton’s Active Energy Control is an example of this technology.

This algorithm works right out of the box, no tuning or adjusting of parameters is required. The algorithm monitors the output power performance while reducing the input power requirement. To assure the stability of the motor, the algorithm initially sets the drive output voltage at the same level as the voltage based on the linear V/Hz method for the same reference frequency. It then begins to reduce the voltage incrementally to optimize the energy usage. Meanwhile, the algorithm monitors several real-time parameters of the motor to prevent the motor from entering conditions that may lead to instability. When the motor enters the optimal zone of operation, the drive output voltage stays at the same level until there is a change triggered by commands to the drive, such as a change in the reference frequency or a change in some real-time parameters. After the output voltage stabilizes, the drive keeps monitoring the real-time parameters of the motor to prevent instability conditions.

The VFD built-in algorithm can save energy costs up to 10 percent more compared to the optimization parameters as the algorithm is actively monitoring and consistently running the optimization algorithm at all times. This is big savings to realize for systems with multiple loads with the added benefit of no additional adjustments required to maintain the systems performance and reliability.

Electronic bypass control
Many HVAC/R applications are mission critical to a building or facility’s processes. It is suggested to improve the reliability to the system to have a bypass circuit in parallel with the VFD circuit. The bypass circuit provides redundancy to the primary VFD circuit in case of failure or fault conditions. Bypass circuit can include contactors, reduced voltage soft starters or another VFD.

• Most commonly, contactors are used because they are compact in size, reliable and inexpensive. While in bypass mode, the contactors would run the motor at full load amps. No energy savings are seen during contactor bypass mode.
• Often, reduced voltage soft starters are a bypass option for motors that tend to have high inrush currents that can damage mechanical components in the motor or equipment such as water hammer in pumps. The soft starter is able to ramp up the current and eliminate this high inrush current. The soft starter, like the contactor, would run the motor at full load amps once the current ramp process to full load amps is completed.
• Lately, VFDs are becoming a specified bypass solution to provide the highest level of redundancy. The VFD bypass circuit can control the system in the same manner as the primary VFD and continue to communicate to the building management system. By using a VFD bypass circuit, you can resume the energy efficiency and savings similar to the primary VFD.

These three methods of bypass can be controlled two different ways – manually or electronically. Manual bypass control allows a user to switch the VFD into bypass mode or back into VFD mode through a position switch or pushbuttons. This method provides the user a physical control mode, but the control is local to the VFD and manual.

Electronic bypass allows the bypass mode to be controlled by the VFD or an external controller. The controller or VFD can receive signals and electronically put the VFD into bypass mode and close the bypass circuit. Signals could originate from a digital input from a sensor, via communication from the building management controller or from the VFD keypad for local control. This improves the monitoring capability and system processes while reducing the overall cost of the VFD product by removing pilot devices from the front of the enclosure and the labor to assemble.

By using a VFD with built in electronic bypass, you can further reduce the cost of the product since the external controller is not required. You can also add functionality to go into bypass mode in a fault condition providing even more system process protection and increased system reliability.

Utility Rebate Programs
As energy demands rise with increased population, manufacturing and facilities, utilities are offering rebate programs to residential, commercial and industrial customers to promote the use and installation of energy efficient products that can help reduce the energy footprint. These programs include rebates for LED lighting or smart lighting controls, solar PV arrays, and highly efficient HVAC/R equipment and controls – including VFDs.
These programs encourage building owners and facility managers to upgrade equipment to the more energy efficient solution. The initial capital cost of installing the new solutions can be offset by the rebate and the long-term energy savings. VFDs alone can provide a 60 percent energy savings over standard across-the-line starters.

Energy saving calculators can help visualize the long-term cost of a VFD versus a starter. The calculator evaluates the typical fan or pump duty cycle, the initial cost of the VFD, and the motor efficiencies. It conveniently provides a report on the energy saved and reduced carbon footprint. This report includes estimated payback time to better understand the effect of installing a VFD in place of a starter.
By utilizing the utility rebate programs and the energy savings calculator, building owners can see monetized benefits of installing a VFD to control the HVAC/R applications.

For more details on the utility rebate programs in your area, visit www.DSIREUSA.org.

Energy efficiency has become more important to building owners and facility managers as a channel to achieve overall cost reductions. Energy is crucial to most applications, especially mission critical HVAC/R applications. By optimizing the input power required to maintain output performance, utilizing VFD integrated electronic bypass for improved reliability and taking advantage of the rebates available, VFDs installed on variable torque motors are an easy solution to reduce energy cost, increase energy efficiency and improve systems reliability and monitoring.

Want to learn more about VFDs? Click Here.

The post Gain More With VFDs appeared first on IE3: Indoor Environment & Energy Efficiency.

You have worked long and hard to build a company that is known for its reputation of professionalism, honest business practices, customer service, and technical skill. You know that a million factors have to work together seamlessly in the background for your company to succeed and you know that the talent that you hire ultimately becomes the face of your company. Your customers see your technicians on a regular basis and how they perform reflects heavily on your company’s image and reputation. This is why training is so important and why it is necessary to maintain that training with continued education.

One of the most important factors for your team to be trained on is safe driving practices and building an on-going safe driving program is an important step in maintaining the quality that you expect from your workforce.

President and CEO of Aire Rite Airconditioning and Refrigeration and
ACCA Senior Vice Chairman, Don Langston puts the importance of hiring and continually training safe drivers in perspective by explaining why his company maintains a well-trained team of drivers by explaining, “We want to hire and promote safe drivers. They are driving around in big mobile billboards for our company.”

Langston’s prospective employees go through a tough and thorough screening before they are hired. The screening is designed to make sure applicants do not have a DUI, reckless driving convictions, and/or too many speeding tickets. Langston explains that if these issues exist with a prospective employee that most company auto insurance providers will deem them as high risk. Being deemed high risk could disqualify the applicant altogether or cause the rate to insure them to be significantly higher, which in turn affects the company’s bottom line.

Once an employee is hired to work for Langston’s company they become part of an on-going Safe Driver Program that focuses on continual training and monitoring of their driving practices.

Aire Rite Airconditioning and Refrigeration’s Safe Driver Program provides a solid example for others to follow. It consists of the following:

Safe Driving
1. Driving Record Motor Vehicle Reports from State of CA Dept of Motor Vehicles
2. Points on record compared to skill level requires a risk to reward aspect to meeting the company’s safety standards and work load

Onboarding New Hires Includes

1. Safety overview of OSHDa driving and driver documents
2. Ride along with retired law enforcement driver consultant
3. Ride along with seasoned company employees
4. Use of outside third party Hazard Perception Evaluation (HPE)
5. Third party safe driving video repository
6. Third party assignment of up to six videos related to HPE
7. Third Party Driver Safety Program through Fleet Response
8. Telematics through Verizon Networkfleet that connects to third party driver safety system
9. Point system based on 700 driving issues disseminated from 40,000 issues from extensive customer data and multiple State DMV’s, NTSB, OSHA, and National Safety Council (NSC)
10. Driver Portal of all driving history and driver event documents in single location repository
11. Driving school for additional training or remediation on a case by case basis.
12. Driver Complaint system utilizing third party retired law enforcement consultant
13. Investigate and provide a formal report
14. Driver record as part of the annual performance review

General Safety for the Work Environment
1. Onboarding safety orientation
2. Near miss practices of feedback for proactive mitigation of potential serious safety issues
3. All technicians trained in OSHA 30 hour course
4. All technicians trained in NFPA 70E
5. EPA Universal/608
6. Ongoing safety trainings
7. Outside third party audit annually of company safety program and procedures

According to OSHA, motor vehicle crashes are a leading cause of death and injury for all ages. Crashes on and off the job have far-reaching financial and psychological effects on employees, their coworkers and families, and their employers.

OSHA recommends that every company with a fleet of vehicles needs a Safe Driver Program to save lives and to reduce the risk of life-altering injuries within their workforce, to protect their organization’s human and financial resources, and to guard against potential company and personal liabilities associated with crashes involving employees driving on company business.

On its website, OSHA outlines the Network of Employers for Traffic Safety’s (NETS) 10-Step Program which provides guidelines for what an employer can do to improve traffic safety performance and minimize the risk of motor vehicle crashes. According to NETS, following these steps helps to ensure that a company hires capable drivers, only allows eligible drivers to drive on company business, trains them, supervises them, and maintains company vehicles properly. NETS suggests that adherence to these 10 steps can also help to keep motor vehicle insurance costs as low as possible.

By working with these steps as a guideline a company can design a customized Safe Driver Program based on their particular needs.

NETS 10-Step Program includes the following steps:

1. Senior Management Commitment & Employee Involvement
2. Written Policies and Procedures
3. Driver Agreements
4. Motor Vehicle Record (MVR) Checks
5. Crash Reporting and Investigation
6. Vehicle Selection, Maintenance and Inspection
7. Disciplinary Action System
8. Reward/Incentive Program
9. Driver Training/Communication
10. Regulatory Compliance

If you are looking to build a Safe Driver Program or to strengthen an existing program, the following resources will be helpful:

• Federated Insurance’s   In the Blink of an Eye – Avoid Distracted Driving program and What’s Important to You? – Don’t Text & Drive programs are available on DVD. Visit www.federatedinsurance.com/ws/fi/index.htm or email Nate Oland
• OSHA’S Guidelines for Employers to Reduce Motor Vehicle Crashes which includes important financial resources including a Costs of Motor Vehicle Crashes to Employers Worksheet: www.osha.gov/Publications/motor_vehicle_guide.html
• Network of Employers for Traffic Safety: www.trafficsafety.org
• Occupational Safety and Health Administration: www.osha.gov
• National Highway Traffic Safety Administration: www.nhtsa.dot.gov
• Business Defensive Driving: www.businessdefensivedriving.com

The post Drive for Safety & Success appeared first on IE3: Indoor Environment & Energy Efficiency.

Selling Variable Refrigerant Flow (VRF) systems in today’s marketplace depends on educating commercial property owners about the benefits of this ductless HVAC technology.

“VRF is a relatively new concept for many building owners throughout North America,” says Jerad Adams, product manager for VRF Systems at Trane Commercial.

The sales focus needs to be on functionality, comfort, reduced operating costs, and installation on a relatively small equipment footprint, says Adams. “Once they learn more about VRF systems, customers are, more often than not, interested in that solution.”

Thomas McLaughlin, principal at HVAC distributor DXS Texas, agrees that anyone selling VRF systems needs to focus on selling points, such as decreased electrical requirements, compact size, low sound levels, and design flexibility.

Moreover, HVAC and B2B sales expert James Graening of jamesgraening.com stresses the importance of focusing on the benefits of VRF systems when talking with prospective customers. “VRF and VRV systems allow for higher efficiencies with very good flexibility,” he says. “We typically see much higher efficiencies, gaining up to 40 percent savings in operations and energy over older systems.”

Vertical Markets

Adams says that customizing proposed solutions for vertical markets is “absolutely a must,” because each type of facility will have different requirements. For example, he says, “A K-12 school is going to be primarily concerned with IAQ, acoustics, and efficiency, while a hotel is going to be very focused on tenant comfort and multi-zone heating and cooling. It is key to know your customer’s needs and modify your VRF presentation accordingly.”

McLaughlin adds that one of the most attractive selling features of VRF technology is its flexibility to conform to many different building types. “We like to say, that with VRF you design ‘your HVAC system around your building, not your building around your HVAC.’”

But, he adds, “Use VRF where it makes sense, and couple it with other equipment for a total building solution in the areas where it doesn’t.”

Five key considerations to review with prospective buyers are efficiency, design & technology, cost, maintenance, and sustainability

Efficiency

“Overall, efficiency is a key benefit of a VRF system,” says Adams. “It is important to share with customers that initial equipment efficiencies show immediate ROI, as well as any incentives they would be able to receive from government and utilities,” he says.

The small footprint of VRF systems is another feature that resonates with commercial property owners and developers. As Graening notes, prospective customers and building owners who are seeking higher efficiency or dealing with retrofitting older building are often already interested in VRF systems before ever talking with a sales rep.

Still, adds McLaughlin, “efficiency is the icing on the cake, it is the not the main course.”

Design & Technology

While efficiency is a key consideration, McLauglin says building owners and developers are often sold on VRF systems, because they combine economic efficiency and design flexibility.

Adams adds that VRF offers building owners access to some of the most advanced HVAC technology available. Key design and technology aspects of VRF, he notes, include liquid-cooled, inverter-driven compressors, controls that easily integrated into third party building systems, 24/7 self-diagnostics, and soft-start technology.

In addition, says Adams, when VRF is combined with a heat pump system, low ambient cooling and heating capabilities eliminate the need for fossil fuel or electric backup heat. “Refrigerant management,” he adds, “enables VRF to be the only HVAC system that allows for simultaneous heating and cooling in a single operation.”

Cost

While a major selling point of VRF is room-level zoning flexibility, zone control comes at a cost. McLaughlin recommends a sales approach that focuses on a balance between installed VRF system features and cost.

“The flexibility of the VRF system capabilities have to be matched with a realistic consideration of the budget,” he says. “Every job has a balance point between zone capabilities and cost.”

VRF systems are increasingly cost-competitive with traditional systems. In fact, adds Adams, upfront costs — particularly in new construction projects— can be lower than conventional systems. Reduced weight lowers the structural cost for roof weight load distribution; there are no mechanical room requirements; no duct leakage; and crane lift is typically not required for installation.

Service

Service flexibility and operational costs are another selling point for VRF. Annual preventive maintenance on VRF systems are easier to perform and usually much less expensive than for conventional HVAC systems. “VRF systems also tend to have a 10-year full warranty; where as traditional unitary equipment has a one-year parts warranty, further reducing ongoing costs,” notes Adams.

Another advantage of VRF systems is the ability for building owners to replace system components over time, instead of having to replace the entire system. “This capability makes it more affordable to upgrade and replace equipment” says Adams. “The components are also smaller and easier to service and change.”

Moreover, adds McLaughlin, the basic principles of air conditioning apply to VRF systems, so installation contractors and service providers can train existing technicians to maintain and repair installed units.

VRF systems also have the ability to self-diagnose maintenance needs, which can help prevent unexpected and costly system failures. “But,” adds McLaughlin, there are differences in these systems that a service company or technician need to understand and be knowledgeable in handling.”

Sustainability

VRF also offers good selling points for new construction and retrofit developers that are concerned about environmental sustainability issues.

“An increasing number of development projects include a green component, which further enhances the attractiveness of a VRF option,” notes Graening.

VRF systems also can “significantly decrease the overall electrical load requirements to a building,” says McLaughlin. “The reduction in power requirement to the building is a good part of the sustainability story surrounding VRF, that does not get a lot of attention.”

Pitch the Best Possible Solution for the Customer

Customers will often ask about what different options will work for their building. A popular option to be asked about is geothermal heat pump (GHP) systems, because currently there are tax credits that make them an attractive option. As a contractor, it’s your job to figure out what is best for your customer.

Adams says that one of the biggest benefits of VRF systems compared to GHP systems is that VRF installation is easier and less costly. “With VRF there is no digging or drilling required, and loops do not need to be installed,” he says. “New VRF equipment can deliver equal efficiency performance and complete zone control capabilities with the functionality of simultaneous heating and cooling, something that GHP cannot provide.”

While McLaughlin agrees, he recommends pitching the best possible solution for each unique situation. “Some projects may be better served by one system type or the other,” he says. “This will depend on the goals of the owner in conjunction with the location of the project, as well as the budget.”
At the end of the day, a successful VRF sales strategy starts with the goal of meeting the prospective buyer’s needs, and evolves with the development of a customized solution.

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