by Paul Stalknecht
Remember when consolidation was going to change the HVACR contracting industry? It was just a few years ago. Some contractors saw an opportunity; many more saw a threat.
For most independent contractors, it hasn't turned out quite the way they thought it would. But one thing is clear: consolidation has changed the HVACR contracting industry. How?
It has made many independent contractors realize that they can't thrive on their own.
For those contracting businesses belonging to ACCA for more than 25 years — and they number in the hundreds — this isn't news. They know the secret to success is collaboration with other contractors.
So Many Choices
With the advent of consolidation, small independent contractors faced the frightening possibility of competing against conglomerates with buying power and lower overhead.
It's no surprise that these contractors realized they could better compete if they pooled some of their resources with other independent contractors in the same boat, so to speak.
It’s a little surprising how many options these contractors suddenly find themselves having. Almost every day we get mail or e-mail about a new HVAC alliance forming. Some offer comprehensive operational services, while others are more focused on specific items, such as employee training or marketing.
Some are formed by contractors, some by consultants. Most, but not all, have geographic exclusivity for their affiliated contractors.
I hear many good things about some of these alliances, and many of them are associate members of ACCA. But on occasion, I can't help but ask the question: "Why are there so many of them?"
A Marketplace of Ideas
One answer is that HVACR contractors are a diverse group. Different alliances serve different needs. As with any marketplace, this new market of for-profit alliances will see niches explored, ideas tested, and competitors come and go.
At ACCA, our only goal is the continued success of the HVACR contracting industry. We bring contractors together to exchange ideas and advocate for the industry's best interests based on our membership consensus.
We don't just train contractors to deal with the challenges of today. We advocate, and actively seek to improve the business environment for responsible contractors. That is the fundamental difference between a trade association and the for-profit alliances.
When HVAC contractors are socked with rising health insurance premiums (growing on average by more than 60% in just three years), they call ACCA. When a state legislature surprises the industry with a last-minute amendment that allows retailers to install HVAC without being licensed, contractors call ACCA. When the IRS refuses to let small contractors use a more realistic and less expensive method of accounting, contractors call ACCA.
Effecting change takes time. It took us several years to convince the IRS to change accounting procedures to save money for small contractors. We remain committed to promoting common-sense legislation to reduce health insurance costs, and are making plans for a new push to promote sensible HVACR licensing requirements around the country.
Change for the Better
We believe that the future is bright for HVACR contractors who choose to embrace professionalism, honesty, and creativity, and who realize they can't succeed on their own unless their industry is strong. The contractors who share this vision are finding a place in ACCA, and we welcome the chance to serve them.
And, yes, many of our members also find a place in for-profit alliances. In a competitive and diverse market like HVACR contracting, such specialized groups can provide attention and resources to certain niches within the industry that can only help all of us.
At ACCA we remain committed to what has set us apart for 40+ years: the entire HVACR contracting industry can move mountains when it stands united, and our only job is to help it along.
Paul T. Stalknecht is the president and CEO of the Air Conditioning Contractors of America (ACCA). He joined ACCA two years ago and has refocused the 4,000-member association on the needs of HVACR contractor contracting business owners. He and his team have introduced new services and benefits designed to help members operate profitably and efficiently. Stalknecht can be reached via e-mail at email@example.com.