Tom McCart, the first salesperson to sell $1 million of residential replacement sales in the HVAC industry, left a rich legacy of advice for contractors. In this series, we present, in alphabetical order, Tom's posts to The Service Roundtable's HVAC.Roundtable discussion list.

This month: topics beginning with the letter "D".

Daily Challenges

The following are a few of the daily challenges I see with our industry:

  • Finding accurate retail pricing methods
  • Accurate estimating for "cost of goods sold"
  • Efficient accounts receivable
  • Maintaining cash flow
  • Operating capital is tied up in accounts receivable
  • “Occasional” customer retention activity
  • Maintaining customer follow-up
  • Extending computerization to service agreements and service history

Here are some areas that need systems in place:

  • Equity growth
  • Budgets
  • Sales forecasts broken down daily by tech and sales person
  • Marketing plan based on company requirements
  • Company image
  • A way to provide updated tools
  • An exit strategy or succession plan

Quit working in your business and start managing, training, and leading your people. Dun and Bradstreet attributes all business failures to a lack of business knowledge!

Desire to Succeed in Sales
A friend named Rita had never made more than $15,000 per year. She was a single mom that worked in a doctor’s office. After one year in commission sales (on commission), she earned about $65,000.

The thing that separates the right person is strong desire to succeed. Rita wanted it bad. She was tired of being broke in debt. She read every book I told her to read and did most of what I coached her to do.

Dispatching Secrets

Have dispatchers dispatch the first call of the next day, the night before they check out to go home.

Following every call, techs should call in with:

  • Arrival time
  • Parts used (so you can fax an order to your supplier to replenish that evening)
  • Amount collected (so you can track the sales pace)
  • Discounts given or service agreements sold.

Technicians should be reminded to complete all of their paperwork and verify that they're ready for the next call.

Discounts Have a Place

I give discounts to cash customers, or those who arrange their own financing. What did it cost me? Nothing! It was built in, to take care of the cost of financing. If you are not adding this cost to your pricing, you are discounting every sale!
If you add the finance cost to your pricing and keep it, how honest would that be?

I have a friend who teaches salespeople to offer discounts, but in turn the customer must provide some consideration for this discount, such as testimonials, referrals, a compromise in the system accessories, or some other value-based option.

Doctors Need Contractors, Too

While I was in the hospital, a $12/hour nurse’s aide brought me an $18 aspirin. I asked if the water was free, and she looked at me like a tech who had just been asked to give a price on a new system!

My surgeon went to school almost 19 years to learn his profession, yet he still needs us to fix and service his comfort system!

Door Hanger Hang-ups

The best source for leads is cold calling, however, I realize most are not willing to do this. By and large, door hangers have never worked unless you actually knock on the door and hand it to the homeowner.

Knock on the door and introduce yourself and your company. Deliver a small introductory gift such as coupon book or a company check worth $25 to $40, made payable to your company, to be used for a service or product. If you have a company brochure telling your company story and testimonials from happy customers, include it.

The purpose is to meet face-to-face. Let people see who you are. I have generated more leads doing this than any other campaign.

Duct Systems

The duct system is half of a total comfort system!

The installer can't inspect the air distribution system if the salesperson didn't test CFM on the sales interview. Until we train our salespeople on the value of inspecting and testing the other half of the system we will continue to do what we have always done in the past.

A consumer who is being sold a 13 or 16 SEER system probably got an 9 or 10 SEER instead of a 12. It's like quoting a SEER rating on a condensing unit without a matching evaporator coil, which is the other component.

We are afraid to address the air distribution system because it would increase the retail price of the system and put us out of the proverbial ballpark from our competition.

A long-time contributor to Contracting Business, Tom McCart was HVAC’s first million dollar residential retail salesperson. Tom died of Lou Gehrig’s Disease on Jun 10, 2004. ALS took a toll on Tom physically. It took a toll on his family financially and emotionally. Tom’s business has survived. Please support Tom’s survivors and his legacy by purchasing his books or attending No Secrets training (www.nosecrets.com).

You can also purchase “From the Sky Up, the Tom McCart Story on DVD,” or any of Tom’s seven sales, marketing, and management manuals, at www.hvacprofitboosters.com. All proceeds from the sales of Tom McCart’s products go to Tom’s estate to help his survivors pay Tom’s medical and long-term care expenses.

For more information about the Service Roundtable, including a FREE e-book on service company marketing, visit www.ServiceRoundtable.com, call Liz Patrick at 877/262-3341, or e-mail liz@serviceroundtable.com.

Matt Michel is president of the Service Roundtable (www.ServiceRoundtable.com), an organization dedicated to helping contractors prosper. Matt is also the publisher of Comanche Marketing, a free marketing e-zine. Subscriptions are available at www.ComancheMarketing.com. You can contact him directly at matt.michel@serviceroundtable.com. Or send your comments to Contracting Business at letters@contractingbusiness.com.