Furnace season is rapidly approaching and right now, if you check out websites like Craigslist or Kijiji you will see HVAC companies big and small selling a furnace installation for about $3500 on average. Want to know something? For the past decade, I would go online this time every year to see what the cost of a new AC installation was going to be from different companies and every year, like clockwork, the number is always somewhere between $3500-$4000.
I’d always wondered why those companies never increased their prices and then I understood very quickly a simple fact: they didn’t know how to market their company outside of offering the lowest price.
Now I want you to put yourself in the consumer’s position: if you have ten companies in town all selling furnace installs for basically the same price, how do homeowners make their decision? Right … they flip into “nickle and dime mode”. They’ll buy off a guy who is $25 less than you BECAUSE you made it about the price from the get-go!
And you can’t really blame the homeowner for making it about the price because those HVAC contractors are only selling based on the price. They’re not selling their company brand. They’re not selling what makes their company better than the competition. They’re not putting guarantees on their installations either. Guarantees like an “Investment Protection Guarantee” which states that if the system ever conks out in the first five years that your company would replace it free of charge.
Of course consumers are going to buy based on price – contractors make it about the price every single day. So, it begs the question … how do you get new leads without advertising based on price alone.
The answer is simple: spiff your technicians. Give them $50 for a solid lead (one where no ball park price has been given to the homeowner and where the equipment is over 12 years of age) and another $50 if the lead sells. If your technicians are in fifteen houses a week and ten of those houses have equipment that is 12 years or older, they have an opportunity to make some really good spiffs if they approach things correctly. And in order to set the lead properly, your technicians need to compare the cost of a repair with that of a replacement. They also need to show the homeowner the “Actual Cost of Keeping the Old System vs Replacement”.
In order to do all this, you need to … you guessed it … train your people. You need to give them financial incentive to pay attention to the training, hence the spiff of a potential $100 on every piece of equipment that gets sold as a result of their lead. If they set 10 solid leads in a week, that means $500 in their pocket – a WEEK! If all 10 sell … that’s $1000 in their pocket each week or $4000 extra every single month! You need to spell it out to your techs because from where I’m sitting that’s a massive increase in their pay every single week, month and year.
But you have to be priced right. If everyone else is selling furnaces for $3500 then you need to sell yours for $5000-$8000 and you need to show an extra $1500 in value to the homeowner … likely through guarantees. You need to also have a structured sales process in place where you can get a professionally trained sales person into that home as opposed to dropping off bids. Remember: if you drop off bids you have a less than 33% chance of closing because everybody gets three bids unless you teach the client why getting three bids increases the risk to them.
So … the choice is yours as furnace season approaches. Do you want to do the same as everyone else where you pray and hope customers call you for a price or do you want to invest some time and energy in developing a winning approach to setting leads and getting more people investing in furnaces that YOUR company installed for MORE money than you ever thought possible?
It’s on you to change your situation. You can keep spinning your wheels or you can think outside the box. Remember: the top 5% of HVAC companies are doing the OPPOSITE of what you’re doing right now. Maybe it’s time to start doing things differently.